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PanIP Drops E-commerce Patent Lawsuits 104

Posted by timothy
from the mighty-noble dept.
Darlok writes "Back in October 2002, PanIP sued 50 small businesses, claiming patents over basic E-commerce functions. One of the defendents set up a group defense fund, and in the last week, contributors to that fund have been notified by e-mail and this notice on the fund's homepage that PanIP has agreed to drop its lawsuits without any licenses being issued. The U.S. Patent Office is currently reviewing the patents in question. Hopefully this will set some sort of precedent ..."
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PanIP Drops E-commerce Patent Lawsuits

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  • by The I Shing (700142) * on Monday March 29, 2004 @10:14PM (#8710180) Journal
    I posted my take on this story four days ago on my journal.

    Here's what it says about it:

    The message board and all the pages within the site are now gone, and there's only one single page that briefly outlines what happened.

    But big fat question marks are all over the place. What happens now? The fifteen or so defendants who banded together to fight are off the hook, at least as far as PanIP is concerned, but what about the dozens of others? Has PanIP dropped all of its suits, or just the ones against the members of that group?

    At the bottom of the page is a sort of cryptic quote: "Don't let the things you can't do stop you from doing all that you can," which I take to mean that among the things that couldn't be done was to utterly defeat PanIP and prevent its founder from continuing his campaign of lawsuits against e-commerce companies.

    Back in January, the founder of the PanIP Group Defense Fund had placed a warning on the site that PanIP was sending threatening letters out to businesses who had previously been left alone. Were those letters a last-ditch effort by PanIP to generate the capital necessary to continue the fight over its patents? Or was PanIP anticipating settling its way out of paying the $19,000 in legal fees awarded to the defense group following a determination by at least one judge that PanIP's defamation lawsuit against the group was an illegal SLAPP under California law?

    Should e-commerce businesses breathe a sigh of relief that PanIP has backed off, or should they be more worried than ever? If PanIP starts up its campaign of lawsuits anew, will the next round of targeted companies similarly band together to fight off the suit?

    The former website of the defense group states that both of PanIP's e-commerce patents are facing re-examination by the USPTO. The "automated sales" patent has been under review since August, according to the old version of the site, which never mentioned that the other patent was actually under review. If they are indeed both under review, can PanIP even file any new lawsuits?

    I do not mean to denegrate the defense group in any way... standing up to PanIP was, in my opinion, the correct and brave thing to do. And, at the same time, carrying on the fight when an olive branch is offered with few, if any, strings attached would have been foolish. I don't blame the defense group for opting out of a longer, uglier fight, and I salute them for standing tough as long as they did. Just getting the patent office to re-examine both the patents was quite a feat, one that very well might get both patents invalidated and send PanIP packing in the end, after all.

    But if the patents are re-affirmed, you can bet that a whole lot of businesses who'd never heard of PanIP or its patents will be hearing all about them real soon.
  • Precedents (Score:5, Insightful)

    by Liselle (684663) * <slashdotNO@SPAMliselle.net> on Monday March 29, 2004 @10:15PM (#8710186) Journal
    Hopefully this will set some sort of precedent...
    Since I have a PhD in /. patent law, I'll take this one: It might set "some sort" of precedent, but since PanIP dropped the case, it probably won't be a legal precedent. D'oh!

    As an aside, I like the choice of "www.youmaybenext.com" for the fund's homepage. I wonder what the next ridiculous patent lawsuit will be for? I smell a new poll.
    • by Anonymous Coward on Monday March 29, 2004 @10:21PM (#8710224)
      I wonder what the next ridiculous patent lawsuit will be for?

      Method for remotely overloading and causing service interruption of Internet servers through the use of multiple HTTP requests ("Slashdotting")

      • by Deraj DeZine (726641) on Monday March 29, 2004 @10:52PM (#8710383)
        That uses far too much regular English and not enough of the word "said." My take:

        Method for organizing users ("slashdotters") in the creation of a cascade of TCP/IP ("Telecommunications/Internet Protocol") traffic in the form of page requests ("hits") to an unequipped personal web server in order to remotely overload said server ports or network throughput ("bandwidth") limitations causing service interruption ("slashdotting") in distribution of said pages resulting in the return of multiple HTTP ("hyper text transfer protocol") errors including, but not limited to HTTP errors 404 and 501 as identified in RFC 12345 Section 6: "HTTP Error Codes," produced and disseminated from said server to said page requests from said cascade using said technology.
    • Re:Precedents (Score:3, Insightful)

      by Anonymous Coward
      A PhD in /. law? How was /. law school? :)

      Seriously though, it does set a very important precedent--namely, that other companies sitting in PanIP's sights can and ought to fight back, because
      PanIP doesn't appear eager to see itself in court.

      Know thy enemy, and all that...
      • by Liselle (684663) * <slashdotNO@SPAMliselle.net> on Monday March 29, 2004 @10:58PM (#8710424) Journal
        A PhD in /. law? How was /. law school? :)
        How was it? I'd rather not talk too much about it. Suffice it to say that my peers had hygiene issues, there was always a rush to be the first one in class, professors constantly duplicated their own lectures, and my diploma was created with outdated HTML and an eye-gouging color scheme. I won't even get into the thing with the "crackhead" TA's that graded papers.

        Oh, and we had a knock-down drag-out fight every other day about the difference between copyrights, trademarks, and patents. That was pretty annoying. Otherwise though... good times, good times.
  • by LostCluster (625375) * on Monday March 29, 2004 @10:16PM (#8710192)
    The PanIP Group Defense Fund is saying that it's going to dissolve because the all lawsuits against group members are being discontinued, in exchange for the group willing to give up the already on the books order that PanIP pay PGDF's legal fees. Uhm...

    To me, this is not a result the outside world should be cheering. It's a settlement that protects the asse(t)s of the group members, but it's not a knockout blow to PanIP. PanIP is giving up nothing but the right to pursue an appeal that they weren't likely to lose and create an even stronger precedent. The PGDF is giving up the chance to extract real money from PanIP.

    Boo! Hiss! Bad move!

    The PGDF shuuld not be folding. Just because their orginal case has been settled does not mean they have become pointless. They should be seeing through that the patents be invalidated, and keeping the group in existance so that anybody sued by PanIP in the future could get quick and easy access to the resources that worked before.

    As their website domain has always said, you could be next to be sued by PanIP if you're doing basic e-commerce on the Web. And nothing in this settlement prevents that happening. PanIP's plan may be to just let this group fade away, and then sue another group of defendants hoping that they don't join together into a large enough group to squash them like a bug again. It's a little too early to be putting the fly swatter away.
    • by Anonymous Coward
      Just because their orginal case has been settled does not mean they have become pointless. They should be seeing through that the patents be invalidated, and keeping the group in existance so that anybody sued by PanIP in the future could get quick and easy access to the resources that worked before.

      No. They should be getting back to running their businesses. End.

  • Great News! (Score:5, Interesting)

    by Thanatopsis (29786) <despain.brian@gm ... minus physicist> on Monday March 29, 2004 @10:16PM (#8710193) Homepage
    I had a friend who was being sued by PanIP. His online discount perfume store was nearly forced out of business over these dubious patents. What kills me is that the prior art for selling on the web was out there. Hot Hot Hot [hothothot.com] launched in 1994 doing most everything covered by that group of patents. Good Riddance.
  • Probably not... (Score:4, Insightful)

    by Quarters (18322) on Monday March 29, 2004 @10:18PM (#8710200)
    Hopefully this will set some sort of precedent ...

    Well, it doesn't set any sort of legal precedent and since businesses are, except in the extremely rare case, demonstrably amoral I wouldn't expect any sort of karmic-rub off on other companies, either.

    Businesses are beholden to their shareholders. If shareholder valuation can be increased via protection of patents then the company has a fiduciary duty to pursue that course of action. To not do so would be neglicent and could open the company up to a shareholder lawsuit.

    • In fact, they're missing their chance to set a legal precedent by letting PanIP go through with their foolish appeal and losing...
      • PanIP already dropped the case, at least against the companies that banded together to fight it.

        It should have been dismissed with extreme prejudice, but at least the patents are being re-examined.
      • In a legal sense, a precedent would be something new and groundbreaking. If the courts find PanIP's patents to be invalid due to prior art and such a decision has never been rendered before, then we may call it a precedent. Otherwise, its just another case.
    • It's so neglicent, it could end up landing the company in a negligee!

      I wonder if your comment is what Darl McBride says 6,000 times every night before he does to sleep. And not just because it's boring, but because it formally codifies the self-serving "fuck everything but 5 minutes from now" attitude that so permeates the American business world of today.

      Stunning not only in its retreat from personal responsibility from reprehensible acts (aka Enron) but in its complete indifference to the big picture w
    • Re:Probably not... (Score:4, Interesting)

      by Sensitive Claude (709959) on Monday March 29, 2004 @10:41PM (#8710323) Homepage Journal
      Businesses are beholden to their shareholders. If shareholder valuation can be increased via protection of patents then the company has a fiduciary duty to pursue that course of action. To not do so would be neglicent and could open the company up to a shareholder lawsuit.

      OK, lets take a look at their patent....

      A system for composing individualized sales presentations created from various textual and graphical information data sources to match customer profiles. The information search and retrieval paths sift through a hierarchy of data sources under multiple operating programs. The system provides the means for synergistically creating and displaying customized presentations in a convenient manner for both the customer and salesperson to achieve a more accurate, efficient and comprehensive marketing presentation....


      Beyond the fact that they are using big words to say "Sell stuff on the internet using computers", and using a search engine.... What the bloody fscking heck does synergistically mean?

      Maybe their should be a rule at the USPO that anyone that uses Synergy, let alone synergistically in their patent application should not only have their patent denied, but should be banned from ever filing for a patent again EVER!

      AAAAAAARRRRRRRRG! Really! What the Fsck are they thinking! (or is that the point)

      Maybe I'm just too sensitive. But their shareholders should sue them for being Fscking Idiots who file patents that just don't make sense.

      That person that filed the patent actually lives near me. I should find him and kick him in the ass.
      • At the turn of the 20th century, somebody famously said that the patent office should be closed because everything that can be invented has been invented.

        Well, they kept it open so that things can be re-invented.

      • Maybe I'm just too sensitive. But their shareholders should sue them for being Fscking Idiots who file patents that just don't make sense.

        That person that filed the patent actually lives near me. I should find him and kick him in the ass.

        No, I don't think you're being too sensitive. :-)

      • by phorm (591458)
        Synergy [wikipedia.org]

        In this case, I'm guessing that it's basically meaning co-operation between two groups resulting in mutual benefit (in this case the customer/salesperson). However, the rest of the sentence pretty much says that already, so it's basically a bunch of BS meant to make them sound important.
      • They have no shareholders. It's a privately held company.
    • Re:Probably not... (Score:3, Interesting)

      by rollingcalf (605357)
      "Businesses are beholden to their shareholders. If shareholder valuation can be increased via protection of patents then the company has a fiduciary duty to pursue that course of action."

      No business has a fudiciary duty to use unethical means to extort money from anybody. Some may choose to do so, but they don't have a duty to do so.

      And yes, using bogus patents to extract license fees is unethical, even though it isn't illegal.
    • Gawd, you sound like a lawyer. No wonder everyone wants them in deep dark holes in the desert somewhere.
  • Precedent (Score:2, Insightful)

    by DavidBartlett (748559)
    Hopefully this will set some sort of precedent... Oh, rest assured, it will. I just hope it's a good precedent.
  • by inphinity (681284) on Monday March 29, 2004 @10:23PM (#8710232) Homepage
    What's next? I'll tell you what's next!

    A domain-squatter lawsuit over http://www.youmaybenext.com just because it happens to be some pro-wrestlers's death mantra.

  • by werdna (39029) on Monday March 29, 2004 @10:26PM (#8710255) Journal
    Hopefully this will set some sort of precedent ...

    What kind of precedent? Patent defense consortia have been routine practices in defending against agressive plaintiffs seeking to take fundamental control of key industry elements. When this was first raised, I pointed out the various routes to shut down an overactive plaintiff: reexamination regarding prior art, joint defense agreements and joining forces to share costs of a legal defense. All of those happened and it worked.

    This isn't new, it's routine.
  • by modder (722270) on Monday March 29, 2004 @10:28PM (#8710265)
    The lawyers.
    • While that is often the case, I find it unfair that they are often referred to as thought they planned the whole thing. It is not as thought they had a meeting and decided that part of the group will sue and the other group will defend so the group can benefit as a whole. In general, lawyers and law students are very intelligent people who are active in pursuing what they believe and have often rendered charitable services.

      I would rather blame the CEOs than the people who do their work. Lawyers work for
      • by modder (722270)
        Agreed.

        However, one has to start thinking that something is fundamentally wrong when so much time, effort and money go in to something which produces absolutely nothing.

        (I'm not going to focus on who's to blame, the lawyers who do the work, the CEOs who want it done... etc)

        If you follow the thread of a somewhat less eloquent poster who replied to this, I suggest there may be other alternatives (those I state none specifically) but I think we need to start looking at things in our legal system and change
    • A law that gives patents to obvious processes.
      A legal system that discourages the use of ideas (remember the eolas v microsoft patent)
      The white settlers of a large part of North America thought that patents of nobility were a tyranny.
      Now you can get a patent for a file layout that is based on a standard.
      Whose to blame?
      Those taking advantage of the system?
      Those who enforce the system?
      Those who created the system?
      Those who elected the creators of the system?
      • It's the Supreme Court of the United States, which refused to rein in the blatant abuses of the patent/copyright clauses of the Constitution. As it stands, "promoting the progress of the useful arts" is the same as "granting a stream of monopoly rents to people and organizations with skilled legal teams and good lobbyists."
  • by Jayfar (630313) on Monday March 29, 2004 @10:46PM (#8710345)
    PanIP e-commerce patent suits withdrawn
    20:52 Thursday 25 March 2004 Rejected

    Yeah, I know, go ahead mod me down for bitchin about it and after all, stories like "Pokemon Game Boy Advance Update," that appeared that day really were more "stuff that matters."
  • Precedence (Score:4, Insightful)

    by GreyPoopon (411036) <gpoopon&gmail,com> on Monday March 29, 2004 @10:47PM (#8710355)
    Hopefully this will set some sort of precedent ..."


    Yeah. It sets the precedent that small businesses should work together to establish a "technology, business process and other silly patents defense fund" to deter such behavior in the future.

    • Yeah. It sets the precedent that small businesses should work together to establish a "technology, business process and other silly patents defense fund" to deter such behavior in the future.

      But what if someone files a patent on that as a method of defending your business against ridiculous patents?

      Quick, Someone file this before someone EVIL does.
      (Anyone EVIL please ignore the previous line.)
      • But what if someone files a patent on that as a method of defending your business against ridiculous patents?

        :-) Slashdot already has my record of prior art. :-)

  • by MADCOWbeserk (515545) on Monday March 29, 2004 @11:12PM (#8710523)
    FOR IMMEDIATE RELEASE Contact: William G. Wilhelm 858-454-7095 Raymond Mercado rmercado@panip.com


    PanIP Settles All Litigation With The "You May Be Next" Defendants

    San Diego, CA March 24, 2004. PanIP, LLC is pleased to announce that as of March 19, 2004, it has settled all outstanding litigation with the members of the "PanIP Group Defense Fund, Inc.," the originators of the You May Be Next website. PanIP released those defendants from liability by issuing them covenants not to sue under a confidential settlement agreement. Currently, PanIP has no outstanding litigation in relation to its United States Patent Portfolio.

    In the fall of 2002, PanIP filed suit against 40 individual defendants in the United States District Court for the Southern District of California in San Diego, California, alleging that those defendants were infringing claims in U.S. Patents Nos. 6,289,319 B1 and 5,576,951. Shortly after PanIP initiated suit, a group of sixteen defendants formed the "PanIP Group Defense Fund" in an effort to defeat the patents. Their efforts, like those of another group defense fund formed in 2002, were fruitless. Since 2002, when PanIP began enforcing its intellectual property rights, all parties that have been sued for patent infringement have settled with PanIP and the cases have been dismissed.

    PanIP, LLC is a technology development company that holds a number of United States and Canadian high-impact patents. Several additional patent applications are pending.

    For more information about PanIP, LLC, please visit www.panip.com

    Some interesting stuff, Currently, PanIP has no outstanding litigation in relation to its United States Patent Portfolio. This makes me think the other 24 suits have been dropped. Their efforts, like those of another group defense fund formed in 2002, were fruitless. Seems like they where fruitful in getting you to drop your suits. Perhaps more judges theatening to force companies to pay the legal bills of defendents in questionable patent lawsuits may prevent these things in the future.
  • Perhaps.. (Score:2, Funny)

    by Cyberglich (525256) *
    Perhaps the head of PanIP found a dead fish in his bed :)
  • by rice_burners_suck (243660) on Tuesday March 30, 2004 @01:34AM (#8711335)
    Hopefully this will set some sort of precedent

    The only thing that sets legal precedent is published appellate court case results. Since this didn't go to an appellate court (it sounds like it didn't go to any court), this isn't going to set any kind of legal precedent.

    Perhaps you mean, "Hopefully, this will enlighten stupid fucking multinational corporations, whose board of directors thinks they are entitled to eternal perpetually increasing profits at the expense of others, that they can't fuck with this community."

  • That's it!

    I would like to hereby announce that I am going to finally sue those jokers for trademark infringement, using my good name and/or shameful stealing of my IP. Furthermore, I claim patents over basic metabolic (as well as e-metabolic) functions, therefore please stop breathing as soon as possible. You will do a great favor for the whole e-ndustry and humanity at large. Thank you.

    Sincerely,
    Pan with IP shamefully stolen.

  • IMHO is if PanIP was to be legally stomped to the ground by a countersuit, the way SCO will probably end up thanks to IBM, Novell and RedHat.

    Anything less will still leave a door open for legal thugs to try and mug small businesses on the grounds of ridiculous claims on abusively granted patents (on obvious business methods and such).

    The business world would be a safer place with those jailbirds slammed to where they belong.

  • by Geminus (602334) * on Tuesday March 30, 2004 @09:32AM (#8713006)
    A co-worker and I went to check this PAN-IP company out... after all I'm just a lowly reporter for a small e-zine! Guess what, 329 Laurel Street in San Diego is a spot to park your car... not your butt. There's no office there. I tracked down the PAN-IP owner's house... and it's in tatters within a location called South Park San Diego. Really, the place is a shit-hole and in disarray. My guess is they needed money to pay the mortgage on the tired old house. PAN-IP was a scam folks. Challenge them completely and countersue. Watch this bottom feeder move into Barrio Logan.
    • The owner of PanIP house is most "definately" not in "South Logan" - It's in another part of town - try Del Mar. I happen to know the nephew of this guy. And though I don't agree with what he's doing I have to say the his patent shows how broken the patent systems is.

      For what it's worth his particular patent is one of the most (if not the most relating to Network/Internet) cited patents of it's type. The list of big name companies that cite his patent is a few pages long. Also the date of the patent go
  • I got one of those letters, not from PanIP but from some other clowns, who claim to have invented the idea of downloading media files over the web. They cited the presence of a couple mpegs on my web server as proof that I was using their technology without permission, and insisted that I contact them to discuss licensing. I trashed the letter and never heard from them again.

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