Tech Companies and Patent Trolls Battle Over Standards for Chips, Wifi Protocols, Related Rules

The battle over intellectual capital and the property derived from it continues, but much of the action is taking place in the shadows.

The big companies like Apple, Google and Samsung have begun to realize that rapid innovation is making litigation an expensive diversion. But there remains a well funded sub-culture of parasitical 'patent assertion entities' whose sole purpose is to
 legal control of key technological building blocks and then sue anyone who they claim has 'abused' their property (whether they have or not) as a means of generating income without having to do much more than file suit.

While such entities insist they nurture innovation, the reality is that they stifle it by forcing entrepreneurs and even larger enterprises to allocate capital to litigation defense that would be better spent on research and development.

Fortunately, the courts are increasingly siding with those who believe that these sorts of tactics are economically destructive as well as very difficult to prove, given the intertwined nature of technological advances. So the action is moving deeper into the background where standard setting bodies that few have heard about make the rules that can determine future accessibility to consumers and to society. The more transparency emerges in this field, the less likely that innovation will be held hostage. JL

Jeff Roberts reports in GigaOm:

The outcome of the fight is significant since the new rules for so-called “standard essential patents” will affect what consumers ultimately pay for everyday devices like phones and routers.

A big showdown is taking place at the Institute of Electrical and Electronics Engineers, an important standard-setting body, about rules for patents that cover basic building blocks of tech, such as chips or Wi-Fi protocols.

The outcome of the fight is significant since

A big showdown is taking place at the Institute of Electrical and Electronics Engineers, an important standard-setting body, about rules for patents that cover basic building blocks of tech, such as chips or Wi-Fi protocols.

On Monday, executives from high-profile tech companies, including Apple and Microsoft, put their names to a public letter that sought to safeguard an upcoming IEEE decision from “smoke and mirrors” tactics by patent assertion entities (commonly known as patent trolls).

“[A] 21-member group of chipmakers, OEMs, former regulators, and law professors have written a letter to the IEEE to express their support for the proposed clarifications, and to urge them to stand strong in face of those misleading arguments,” stated Cisco, one of the group members, in a press release announcing the letter.

To make its case for implementing new IEEE rules on how to pay for standards patents, the letter points to the recent example of a patent troll that has been brandishing a standards essential patent to demand thousands of dollars per Wi-Fi chip from hotels and small businesses.

The new rules are supposed to be up for a vote next week. If they go into effect, the group says they will result in a more streamlined process for determining reasonable payments for patent holders, while also reducing the sort of high-stakes litigation tactics that adds expense and uncertainty for everyone in tech.

The troll industry, meanwhile, is pushing back with blog posts warning that the new rules will mean the end of innovation.

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All of these subjects at stake — like standards setting, RAND patents and the IEEE — amount to inside baseball, even for those familiar with the world of the patent bar.

But the outcome will likely have a direct outcome on issues like royalty stacking and and patent hold-ups that hit consumers in their pocketbooks, so it’s worth paying attention — if only for the high-profile names at the bottom of the letter. These also include execs from the likes of Verizon, HP, and Samsung, as well as prominent IP and antitrust academics like Mark Lemley.

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On Monday, executives from high-profile tech companies, including Apple and Microsoft, put their names to a public letter that sought to safeguard an upcoming IEEE decision from “smoke and mirrors” tactics by patent assertion entities (commonly known as patent trolls).

“[A] 21-member group of chipmakers, OEMs, former regulators, and law professors have written a letter to the IEEE to express their support for the proposed clarifications, and to urge them to stand strong in face of those misleading arguments,” stated Cisco, one of the group members, in a press release announcing the letter.

To make its case for implementing new IEEE rules on how to pay for standards patents, the letter points to the recent example of a patent troll that has been brandishing a standards essential patent to demand thousands of dollars per Wi-Fi chip from hotels and small businesses.

The new rules are supposed to be up for a vote next week. If they go into effect, the group says they will result in a more streamlined process for determining reasonable payments for patent holders, while also reducing the sort of high-stakes litigation tactics that adds expense and uncertainty for everyone in tech.

The troll industry, meanwhile, is pushing back with blog posts warning that the new rules will mean the end of innovation.

Advertisement

All of these subjects at stake — like standards setting, RAND patents and the IEEE — amount to inside baseball, even for those familiar with the world of the patent bar.

But the outcome will likely have a direct outcome on issues like royalty stacking and and patent hold-ups that hit consumers in their pocketbooks, so it’s worth paying attention — if only for the high-profile names at the bottom of the letter. These also include execs from the likes of Verizon, HP, and Samsung, as well as prominent IP and antitrust academics like Mark Lemley.