IBM Seeking 'Patent-Protection-Racket' Patent

theodp writes "Wikipedia defines a protection racket as an extortion scheme whereby a powerful non-governmental organization coerces businesses to pay protection money which allegedly serves to purchase the organization's 'protection' services against various external threats. Compare this to IBM's just-published patent application for 'Extracting Value from a Portfolio of Assets', which describes a process by which 'very large corporations' impress upon smaller businesses that paying for 'the protection of a large defensive patent portfolio' would be 'a prudent business decision' for them to make, 'just like purchasing a fire insurance policy.' Sounds like Fat Tony's been to Law School, eh? Time for IBM to put-their-money-where-their-patent-reform-mouth-is and deep-six this business method patent claim!"

I don't suppose anyone has considered

[Mahjub Sa'aden (1100387)]

I don't suppose anyone has considered that they might use said patent to sue trolls out of existence. Which would be neat, and altogether too ironic.

Shining example

[cab15625 (710956)]

It may also be used as the example of just how screwed up the patent system has become. If any company has to have this patent, I can think of much worse companies than IBM to have this one granted.

Of course, there's the prior art.

[Mahjub Sa'aden (1100387)]

If the patent system is really as screwed up as all that, will the prior art in this case matter? Because as far as I can tell, patent trolls have existed since nearly the very beginning of the system.

Re:

[Tim C (15259)]

I can think of much worse companies than IBM to have this one granted.

There was a time when saying that would have been the equivalent of saying it about Microsoft now, or Eolas.

They changed; but can you be sure they won't change back?

A bad patent is a bad patent no matter who has it.

Re:

[jimicus (737525)]

True, but given the current state of the US patent office, it seems to me this could be a case of IBM patenting it before someone else does.

(confused both with my patent and in general)

[Headcase88 (828620)]

Well if so they better stop it. I already filed a patent on filing a patent before others can file the same patent. The patent office approved it on account of being really fucking confused.

Re:

[uglyduckling (103926)]

How is this a bad patent? They're basically saying "pay us this fee and you're free to use any of our 900 billion patents in your own work". Sounds like they're opening it up.

Because it's effectively money for menaces. "Pay us this fee because you might infringe on one of our patents, and you wouldn't want anything nasty to happen to you, would you?"

Re:

[ultranova (717540)]

Because it's effectively money for menaces. "Pay us this fee because you might infringe on one of our patents, and you wouldn't want anything nasty to happen to you, would you?"

If granted, this patent lets IBM to extract money from such protection rackets. Its intended victims are, therefore, the very people you described. "A nice protection racket you have here, better get insurance for it, 'cause you wouldn't want anything to happen to it."

This whole thing is about as tragic and unjust as Tony Sopra

Re:

[yorugua (697900)]

Only problem is: Would a lot of people can claim "prior art"?.

Re:

[stuntpope (19736)]

That was my reaction. Consider that a few days ago, this story [slashdot.org] generated comments such as "I should patent being a patent troll". Well, IBM has the money to do just that. Maybe they are as sick of this as the average slashdotter.

Re:

[budgenator (254554)]

The system of claim 45, wherein the assets in the dynamic pool of assets are intellectual property assets comprising one or more of patents, trademarks, copyrights and trade secrets, wherein the privilege is governed by a floating privilege agreement, and wherein when the privilege is executed rights in the at least one asset in the selected set of assets are transferred from the first party to the second party. United States Patent Application 20070244837 [uspto.gov]

I'm reading it as it is also a renta-patent system,

Re:

[petermgreen (876956)]

that is why a truely effective patent troll makes sure that patent trolling is thier only buisness.

Perhaps this is a means to stop the practice

[PhotoGuy (189467)]

If IBM receives the patent, then it can disallow others from participating in the practice. This patent alone could be a jury-rigged bit of patent reform, for this particular abuse. (Assuming IBM doesn't go crazy and utilize the patent itself.)

I'd tend to think this is more their purpose, than to become the master bully.

Re:

[hasbeard (982620)]

Too bad there's already so much prior art.

Re:

[jackharrer (972403)]

Cosa Nostra, anybody?

Re:

[PhotoGuy (189467)]

True, there's a lot of prior art, but IBM has been around awhile (1888!), and might just be able to claim the lead in this practice; perhaps why they applied for the patent. Although claiming to be one of the first active bullies might not be great for PR value. :)

(I remember working at IBM labs in Toronto, and they had a little historical display in one building, showing some meat cutters and cheese slicers, early products of the company...)

Re:

[hasbeard (982620)]

Actually, I was making a the joke that there was too much prior art for patent abuse itself. I have no idea is there is prior art for this particular patent.

1-click again?

[xzaph (1157805)]

Why do I see the potential justification of this being similar to Amazon's justification of patenting 1-click ordering?

Why dispose of it?

[rumith (983060)]

Such a patent, should it be granted, could become a perfect show-stopper for Microsoft's patent FUD and could also wipe out patent trolls as a side effect.

Patenting patent racketeering = A Good Thing(TM)?

Re:

[Divebus (860563)]

Exactly - that's the only thing propping up most of Microsoft now. They'd have to figure out how to actually make good on marketing claims to survive.

Prior art

[jeevesbond (1066726)]

I think Steve Ballmer already has prior art [slashdot.org] on this method.

Re:

[julesh (229690)]

Nah, this is _far_ too subtle for Ballmer. See my analysis of the first few claims [slashdot.org].

Sweet

[Angst Badger (8636)]

I'm sorry, but this is beautiful. For IBM to patent the process of patent abuse raises legal sarcasm to a fine art form. This is a legal hack of the first order.

Whether it ought to be allowed or not is a different question, but it still brings tears to my eyes. ;)

Re:

[hasbeard (982620)]

They haven't patented "patent abuse." Read the patent (if you haven't) and then read this post: http://yro.slashdot.org/comments.pl?sid=334389&threshold=-1&commentsort=0&mode=thread&cid=21054811 [slashdot.org] for a better understanding of what the patent actually entails.

Re:

[Fred_A (10934)]

To poorly paraphrase a line from Scrubs, "this patent is so beautiful that I want to marry it and have little patents with it".

I hope IBM does the right thing and has lots of fun going on a rampage with it.

Wow, It's Real

[resistant (221968)]

At first, I thought this was a joke from The Onion [theonion.com], but holy guano, Batman! It's for real!

I'm not particularly upset, though. I.B.M. already is known to systematically exploit their huge patent portfolio, as would be expected by their shareholders, but I've not heard of them doing so, recently at least, in an offensive manner. I.B.M. has been trying hard, for business reasons, to be a "good citizen". If anyone has to have such a patent, best that it be them. If nothing else, it'll put a bit of a damper on the true patent trolls.

Good for small businesses?

[Archie Gremlin (814342)]

This might be a great thing for small software companies. At the moment, they can't possibly afford defensive patent portfolios. This makes them extremely vulnerable to malicious suits from big companies that want to squash them.

Being able to buy a slice of protection from IBM would eliminate one of the biggest risks that small developers face. Of course, small companies can't pay millions of dollars in legal fees. IBM will have to offer to defend their clients in court in order to make this work.

Re:

[the_lesser_gatsby (449262)]

But the process doesn't need to be patented. IBM could just offer the service as a business anyway.

Re:

[acvh (120205)]

Yup, that's it. Someone else mentioned here that IBM could sell this as a service regardless of the patenting of it, and it does sound like an innovative idea.

Deep Six

[dancingmad (128588)]

Possibly karma whoring, but I haven't heard the phrase deep six in a while and wondered where it came from.

That bastion of knowledge, The New Dictionary of Cultural Literacy [bartleby.com], says this:

This phrase is derived from the noun "deep six," meaning burial at sea and referring to the depth of water necessary for such a burial. The term was later used as slang for a grave (customarily six feet underground) and, by extension, as a verb meaning "to kill."

Re:

[Deadstick (535032)]

There are bastions and there are bastions...google your way to the Leadsman's Chant. "By the deep, six" means it's six fathoms deep, which is safe water for a deep-draft ship. "By the mark, twain" means it's two fathoms, which is safe water for a Mississippi riverboat, and another esoteric reference is resolved.

Depths of 2, 3, 5, 7, 10, 13, 15, 17, 20, 25, 30, 35 and 40 fathoms are indicated by "marks" on the leadline. The other depths are unmarked and are called "deeps". The leadsman estimates the depth to

If this is granted...

[NewToNix (668737)]

The only truly graceful thing to do would be to transfer the patent to the EFF.

Then let the fun begin.

Re:

[hasbeard (982620)]

Could the EFF use this? I wasn't aware that the EFF held any patents?

Re:

[hasbeard (982620)]

What I am saying is that I believe (through the help of someone else's comment ahref=http://yro.slashdot.org/comments.pl?sid=334389&threshold=-1&commentsort=0&mode=thread&cid=21054811rel=url2html-9793 [slashdot.org]http://yro.slashdot.org/comments.pl?sid=334389&threshold=-1&commentsort=0&mode=thread&cid=21054811> ) that to use this patent the patent holder would need to hold a portfolio of patents itself.

Wow, IBM showing their since of humor...

[3seas (184403)]

...What else could it really be?

How many joke have been writing about patenting the patent process?
Well looks like a very large patent portfoilo company has money to toss at such a joke..

Kudos to IBM

[xednieht (1117791)]

Do realize ladies and gentlemen this is a bold and rather cavalier move on behalf of IBM. It's more tongue in cheek really, laughing at patent trolls and a majority of large corporations long bereft of the spirit of true competition.

It a rather elegant, subtle, and expensive way of inviting said patent trolls to "kiss my hairy ass". hehe

go go IBM

Re:

[AceCaseOR (594637)]

Don't you mean, "Kiss my BIG hairy BLUE ass"?

Attempting to translate the claims to English

[julesh (229690)]

1. A method for extracting value from a portfolio of assets, comprising:granting a privilege to a second party by a first party at time t1 to permit the second party to exercise the privilege upon the occurrence of a predetermined event occurring at time t2 where t2>t1, and wherein the exercise comprises obtaining an interest in one or more assets residing in a dynamic pool of assets comprised of assets from the portfolio of assets at time t2, wherein zero or more assets are in the dynamic pool at time t1 and said zero or more assets are not in the dynamic pool at time t2.

So a company has a pool of assets. It gives somebody else a right to in the future, after some event has occurred, gain one or more of those assets. Some of the assets may have left the pool by the time they do this. Basically, we're talking about the standard financial instrument known as an "option", but over any of a pool of assets rather over a specific asset.

2. The method of claim 1, wherein the privilege is defined in a floating privilege agreement between the first and second parties, the floating privilege agreement having a term and specifying the predetermined event and the type of interest to be conveyed to the second party upon execution of the privilege.

The right can be time limited, and constrained to a certain kind of selection of assets.

3. The method of claim 2, wherein a number of assets in which the second party receives an interest is limited based on the floating privilege agreement.

The selection can be the number of assets acquired.

4. The method of claim 2, wherein the assets are intellectual property assets.
5. The method of claim 4, wherein the intellectual property assets are patents.
6. The method of claim 4, wherein the intellectual property assets are copyrights.
7. The method of claim 4, wherein the intellectual property assets are trade secrets.

Obvious.

8. The method of claim 2, wherein the assets include intellectual property assets selected from the group consisting of patents, copyrights and trade secrets.

But it doesn't have to be only IP. There can be other stuff as well.

9. The method of claim 4, wherein the privilege is exercised by the first party transferring rights in one or more of the assets in the dynamic pool of assets to the second party.

Pretty obvious, really.

10. The method of claim 9, wherein the transfer is by assignment.
11. The method of claim 9, wherein the transfer is by license.
12. The method of claim 11, wherein the license is an exclusive license.

OK, so there are multiple ways of transferring the rights.


13. The method of claim 4, wherein an occurrence of the predetermined event is a trigger event defined in the floating privilege agreement.

14. The method of claim 13, wherein the trigger event is a litigation-related event.

15. The method of claim 13 [sic, should clearly be 14], wherein the litigation-related event is a filing of a complaint against the second party.

16. The method of claim 15, wherein the complaint against the second party alleges that the second party infringes an intellectual property asset of a third party.

Now we get to the meat of the patent. This is not a patent on patent-trolling, it's a patent on a mechanism for defending against patent trolling. What they're patenting is a legal agreement that says "if you get sued for patent infringement, we'll grant you a patent license for one of our patents so you can smite the bastards".

17. The method of claim 13, wherein exercising the privilege comprises the second party selecting an asset from the dynamic pool of assets in response to occurrence of the trigger event.

18. The method of claim 17, wherein exercising the privilege further comprises the first party qualifying the selected asset for transfer to the second party to ensure the selected asset is appropriate for use by the second party f

Re:

[marcello_dl (667940)]

> "if you get sued for patent infringement, we'll grant you a patent license for one of our patents so you can smite the bastards".

which works against the evil corporations. But, as already pointed out in a recent discussion, what if a patent troll, which is not utilizing any of its patents, comes up against you?

Re:

[julesh (229690)]

Except it isn't a patent troll patent. Read it, not the summary or the conclusions other people have jumped to. The patent is about patent-pooling for mutual defence from patent claims.

Re:

[Vitriol+Angst (458300)]

Sounds like a Corporate version of what governments have been doing for years;
A mutual defense treaty.

You sign up with NATO, and rubber-stamp what we want at the UN, and we will defend you if Costa Rica decides to invade. I'd look for some 'feedback' agreement wherein IBM gets some security from the group buying in as well. Anyone trying to sue a member, has to look at EVERY patent in the arsenal, to see if it remotely resembles what they are trying to sue for -- that alone would make suing the IBM patent a

you can patent something like that?

[fontkick (788075)]

Patents like this are proof that America has too many lawyers and MBAs and not enough engineers. Or maybe I'm just nostalgic for the good 'ole days when patents actually had to be material... a new and novel application of a technology or product feature that was a result of, you know, actual WORK originated by the person/company submitting the patent. This patent is basically a patent on a business type. It's kind of like patenting the concept of a bank, whereby you erect a building with a "vault" that allows "customers" to "withdraw" and "deposit" money. The American patent system is starting to exist primarily to employ lawyers... patent everything (no matter how stupid or obvious), and sue everybody.

Funny, +5

[the eric conspiracy (20178)]

This is obviously a jab at the concept of business process patents. It is a common practive today, and thus has a great deal of prior art to invalidate it.

Re:

[Dunbal (464142)]

It is a common practive today, and thus has a great deal of prior art to invalidate it.

      Prior to IBM? I doubt it :)

Has IBM ever abused it's patent/copyright arsenal?

[walterbyrd (182728)]

Msft has filed hundreds of bogus patents. And braying jackass Steve Ballmer uses msft's bogus patent arsenal to threaten the world on a regular basis.

Msft's err, "business partners" : scox and acacia, have actually gone as far as filing lawsuits, apparently on msft's behest. Scox has sued Autozone, Chysler, IBM, and Novell.

How about IBM? I don't remember IBM constantly threating everybody with harassment lawsuits. IBM certainly has the patents - and unlike msft, those patents are for real.

So, I don't know,

Or their lawyers have a sense of humor

[smchris (464899)]

Isn't it true that IBM invented this in the 50s and 60s? They held Microsoft's place long before Customer Assurance was a gleam in Bill Gates' eye. Maybe a kinder, new millennium IBM wants a patent so they can sue any other company that uses the tactic instead of relying upon government prosecution?

Check! And checkmate in three...

[mysticgoat (582871)]

This is a wonderful, delightful piece of work!

If this patent is to be successfully contested on the basis of prior art, some corporation is going to have to go public with the details of its patent protection racket. That company would be exposing itself to a lot of nasty business risks (possibly RICO, possibly anti-trust measures, more probably loss of sales and market cap, very definitely some image problems). I doubt that there are very many CEOs who would like the risk/benefit ratio of such a plan, especially as this kind of thing could break their personal career even if it is successful in blocking the patent.

If IBM is awarded the patent, it can use it to publicly expose the backroom details of the MS - SCO deal, the MS - Novell deal, and similar deals where there is good cause to suspect that some form of patent protection was involved. Through lawsuit and discovery, the secret clauses in those contracts would become public. This would stifle a lot of those kinds of activities, which would be a Good Thing for anyone favoring competition of products based on their technical merit.

IBM could also put the patent in the Linux patent protection pool. I cannot see anything negative for FOSS coming out of that.

But basically I see this patent as a way of demonstrating just how absurd the entire business model patent structure is.

Go IBM!

Nah

[Joey Vegetables (686525)]

Sounds like Fat Tony's been to Law School, eh?

Nah. Me [slashdot.org] and Fat Tony go waaay back, and that gnocchi-eating paisan couldn't fit through the door of law school, much less graduate from one. If youse'a askin' me, my money's on Benny the Brain.

Of course Big Blue won't sue them...

[Chmcginn (201645)]

IBM doesn't have any interest in suing distributors of software that they can get a service contract from.

IBM seems to get that technical support is a better way to make money than bundling software.

Re:

[acvh (120205)]

My take on this is as follows:

I'm a small company developing some new kind of networked mass storage system with what I think are novel ways to manage the backup and restoration of applications and data. Given that many others have done similar things I run the risk of infringing some obscure patent out there. Rather than devote resources I don't have to lawyers and research, I subscribe to IBM's new "super-patent" service.

I get sued by a patent holder over a method of deciding where and when to backup a fi