Why does the EFF support a system that by design consistently hurts hundreds of high tech software companies trying to protect their inventions?
by: Nick Gross, special guest contributor | September 11, 2017
As part of its corporate-funded smoke and mirrors campaign to scare the public and confuse the media about all matters patent, the EFF propaganda machine has recently rolled out a series of horror stories purporting to document harassment of small business owners by bad patent actors.
Leaving aside for a moment the veracity of EFF’s reporting of the merits of these encounters (which a little digging reveals is not nearly as neat and tidy as the EFF suggests), the bigger issue is the EFF’s implication that one of these anecdotal cases (involving Capstone, a small sports photography business) demonstrates that recent judicial applications of the vague and arbitrary “abstract idea” language in the SCOTUS Alice decision to kill patents is somehow a net positive for innovation. In fact, according to the EFF anti-patent partisans, the Alice holding should continue to be distorted and applied indiscriminately to kill as many patents as possible, regardless of any side effects.
Indeed, to the EFF’s broader way of thinking, the bad behavior of a small number of actors should not be addressed by a targeted solution (e.g. to curtail bad enforcements) but rather by destroying a good portion of the patent system. This tortuous logic is akin to suggesting that when one finds fleas in a home, the reasonable course of action is not to spray the rugs, but rather to kill the faithful family guard dog and any other pets.
From looking at their materials however, it is clear that the EFF strained to find even a few instances (in thousands of filed patent cases) where the Alice bromide cured some purported “patent” evil perpetrated against a real startup company over the past 3 years.
In contrast, it takes little effort to find massive numbers of examples of the undesirable side effects wrought on startups and the rest of the participants in the US Patent system. For example, in the PTAB realm, a number of recent PTO decisions contradict the EFF’s false narrative that convoluted applications of the Alice decision somehow benefits small technology companies.
• Exceleron, a startup that designs apps and software for utility company smart meters, was denied a patent on its mobile payments technology by the PTAB based on their distorted application of the Alice logic.
• Wildtangent, an online gaming company, was unable to get a patent on its content rendering inventions, because of the same confusing application of the Alice test.
• Staffly – a SV company that connects retailers with trained staffers was similarly denied a patent application on its technology, because the PTAB asserted that the algorithms could be practiced by humans using pencil and paper and therefore was impermissible under the Alice holding!
• Similarly, Israeli tech innovator Varonis, which protects online companies from cyberattacks, was unable to get a patent again, because the PTAB arbitrarily classified their technology as an “abstract idea” and thus not allowable under their interpretation of Alice.
• Medaxion – a startup provider of cloud tools for assisting anesthesiologists monitor patients, saw its patent application on mobile charts rejected because the PTAB said it was just merely “collecting/organizing, storing, and displaying data” and therefore could not be considered a protectable innovation.
• Paytronix was denied a patent because the PTO mischaracterized their claim to guest/loyalty programs as somehow preempting the entire universe of product prepayment/redemption. Anything that the PTAB can remotely pigeonhole as a “fundamental business practice” is dead on arrival.
• Startup Amphora appeared to be in the clear, as it was successful on appeal in reversing both the Examiner’s contention that their patent application on real-time trading was obvious, and that the claims were an abstract idea because they were directed to merely a “server and computing devices.” But Amphora still lost, because the PTAB took it upon themselves to independently re-summarize the claims as actually being directed to “analyzing market data” which it then went on to suggest was as an “abstract idea” under Alice.
Collectively these startups employ more than a thousand people, and now cannot protect inventions crucial to their businesses. Yet the EFF hypocritically pretends that the PTO is doing this innovation industry a favor by randomly destroying their IP with arbitrary patentability decisions.
The real question is, why does the EFF support a system that by design consistently hurts hundreds of high tech software companies trying to protect their inventions?
Click Here for Part II: for more revelations on the big business private interests being promoted by this so-called public rights organization.
About the author: J. Nicholas (Nick) Gross is a Berkeley based solo IP law practitioner with 30 years of experience representing high technology companies in Asia, Europe and Silicon Valley, including in the areas of patent prosecution, patent assessment, brokering, licensing and enforcement matters. His PTO experience encompasses all phases of patent procurement including drafting, PTAB appeals, post grant challenges and appearances at the Federal Circuit. He has worked with inventors in a number of complex technologies, including xDSL communications, mobile applications, magneto-electronic devices, flash memories, solar modules, semiconductor processing, epitaxial materials, speech recognition, Internet/e-commerce, microprocessor architectures and computer software.
Nothing posted at this site should be construed as legal advice or an offer for legal services. Should you need assistance on an IP matter, feel free to contact me at via email here.