Monster Cables Pushes Around the Wrong Small Company

Alien54 writes "Audioholics has a fun read regarding a recent legal dustup involving Monster Cables. The well-known (some might say notorious) cabling company sent a cease and desist letter to Blue Jeans Cable over a supposed patent violation. What the Monster folks couldn't have known was that Blue Jeans president Kurt Denke used to be a lawyer. His response is as humorous as it is thorough. ' Let me begin by stating, without equivocation, that I have no interest whatsoever in infringing upon any intellectual property belonging to Monster Cable. Indeed, the less my customers think my products resemble Monster's, in form or in function, the better ... If there is more than one such connector design in actual use by Monster Cable as to which appropriation of trade dress is alleged, of course, I will require this information for each and every such design. On the basis of what I have seen, both in the USPTO documents you have sent and the actual appearance of Monster Cable connectors which I have observed in use in commerce, it does not appear to me that Monster Cable is in a position to advance a nonfrivolous claim for infringement of these marks.'"

Re:Once again...

[iamhigh]

Then submit it to /. sooner.

Plus, since when is slashdot in competition with them? If I want to read stupid stories (surprised all the legal talk didn't scare the farkoids) and even worse comments, I will go to fark/reddit/digg. I come to /. to hear halfway intellectual commentary on current issues.

This is exhibit "A" .....

[8127972]

... As to why patent reform can't come soon enough.

Re:The word "owned" comes to mind

[91degrees]

Were Monster cable "owned"?

They're just going to harass someone else now. They don't really care that much. The basic business plan here is "threaten to sue", "threaten some more", "If target refuses to settle then give up, else settle". They know full well that some people are going to call their bluff. He just happened to do it in a very long winded, wordy way that has saved them a lot of time and effort.

Classic Small-Guy Shakedown

[mpapet]

Every small company I've worked for has been shaken down this way.

Step 1: Giant company sees small company as a real or imagined threat.

Step 2: Initiate patent or Trademark litigation.

Step 3: Repeat step 2 until small company is sunk under a mountain of legal bills.

Step 4: Profit!

Comment removed

[account_deleted]

Comment removed based on user account deletion

Re:Monster cable has been taking advantage...

[pthisis]

In my opinion, Monster cable has been taking advantage of the lack of technical knowledge of the general public to convince people to buy EXTREMELY expensive cables, when much cheaper cables would provide equal performance.

Performance of audio systems is not heavily affected by cables, if only the size of the wires is adequate.

I agree with your basic point, but I'd add "And the connections are all solid." (including good soldering/other connection from the wire to the plug and good contact plug-to-jack, or good direct wire-to-component connections for plugless cables)

But yeah, there are standing offers out there from a number of sources for anyone who can consistently double-blind ABX the difference between various "high-end" cables and much cheaper large gauge copper wires.

Re:The word "owned" comes to mind

[masdog]

The long-winded and wordy way, combined with being released on the Internet, will go a long way towards keeping Monster from doing this again. The next company they threaten to sue will likely turn up this letter in a simple Google search, providing that company's legal counsel with a bucket full of ammo.

I would say Monster's days of running around suing competitors will be drawing to a close soon.

Re:Summary...

[Zordak]

If you're actually attempting to prove you own a patent on the RCA connector...

Actually, they're not. All they asserted were design patents, which are flimsy little patents drawn to the ornamental design of the product. They're actually a sort of bastard child you'd get from a weird threesome between copyright, trademark and patent laws. You infringe a design patent by selling a product that looks like the patented design. It has nothing to do with the technology. The fact that they sent five (essentially saying, "You're too close to all five of these different ornamental designs") is pretty good evidence that this was just anti-competitive grand standing. They were just hoping that Blue Jeans would see the word "patent" and think $4M litigation and roll over and stop competing.

The world needs more Kurt Denkes

[TheHappyMailAdmin]

And we need them in a serious way. People who know their stuff, know what the legal system is supposed to be used for, and stand up for themselves in a positive way.

I hope we see more small companies and individuals do this in the future.

Re:The word "owned" comes to mind

[evanbd]

My favorite quote:

Not only am I unintimidated by litigation; I sometimes rather miss it.

Good to see a little guy who seriously intends to go not only to trial but to final judgement against a big patent bully. They definitely picked the wrong person to pick on.

Re:Monster cable has been taking advantage...

[Alpha830RulZ]

Several times, and the physics of why Monster cables do nothing that plain wire can't do is well understood. Bulk 12 gauge multi strand copper is all you need for the highest end gear, and most people won't be able to tell the difference between that and lamp cord without an oscilloscope.

Re:From TFA

[masdog]

If you think about it from a business point of view, he's basically saving his company a lot of legal bills and hassle by not dragging it to trial.

What this really points out is....

[Anonymous Coward]

Now, the real issue here is that every frakking time a large east-coast firm throws up some completely contrived and in this case completely confused claim of infringement, where is the Lawyer that will be able to send something like that on behalf of the poor schmucks that DIDN'T come out of a heavy damage litigation background?

Does the DOJ need to aggressively treat all patent infringement claims such that the one filing the claim is audited by federal attorneys for relevancy? Should the patent office send out investigators and rip the claim apart before it gets to court?

I, for one, would be SOL if a company the size of Monster came after me. I can't even START to mount a defense for this kind of thing. I applaud Mr. Denke but at the same time, I have to say that this is a serious lament for the system. You have to be a high-class lawyer to get this crap out of your company's hair.

This is poetry

[ashitaka]

Not only does he completely and thoroughly tear Monster's case apart, he also points out that Monster uses a Bermuda-based company for IP holding to shift income offshore and avoid paying US taxes. Not illegal per se, but also not something Monster would want broadcast.

Although it may have taken some time to write this he absolutely ensures that Monster will never mess with him again and decreases the chances of Monster going after anyone in a similar fashion. He has done in probably less than a couple of hours what would normally take months of messy litigation.

This guy is a hero.

Re:The word "owned" comes to mind

[Valdrax]

I also love when he threatens Rule 11 sanctions, demands extensive discovery, and threatens to challenge each and every one of their patents. Oh, and he accuses them of acting in bad faith, without candor.

But really, you're right -- threatening their tax shelter was a masterstroke.

I'll be sure to ..

[mbaGeek]

... buy all of my overpriced cables at Blue Jeans Cable [bluejeanscable.com] from now on (obviously I'm not a customer of either company)

This is also a great piece of guerrilla marketing - maybe they are well known in their field but I had never heard of Blue Jeans Cables before today ...

Quality matters for some high-speed cables.

[Animats]

Amusingly, for many years Monster stayed away from the types of cables where quality matters, like VGA cables. VGA cables have a high-bandwidth analog signal, and long (10m or so) VGA cables have transmission-line type problems, where mismatches or crosstalk result in ghosting or blur at the monitor. For short tables, it's not a big deal, but as length increases, it matters. There are lots of crap VGA cables out there. Still, above $15 for 10m, you're overpaying.

HDMI cables have to carry 340MHz, so they're transmission lines. There's a certification process, and if the cable passed it, it should be OK. There are phony HDMI cables out there that don't pass the spec, but all certified cables should work equally well.

There's something to be said for gold-plated connectors, especially for something that's frequently unplugged, but the cost of the gold is trivial.

Re:Once again...

[Anonymous Coward]

Then submit it to /. sooner.

Plus, since when is slashdot in competition with them? If I want to read stupid stories (surprised all the legal talk didn't scare the farkoids) and even worse comments, I will go to fark/reddit/digg. I come to /. to hear halfway intellectual commentary on current issues.

you're joking about that last part right?

Same sh*t, different company

[HiVizDiver]

In my opinion, Monster cable has been taking advantage of the lack of technical knowledge of the general public to convince people to buy EXTREMELY expensive cables, when much cheaper cables would provide equal performance.

Bose [google.com] has been doing this for years as well. It's amazing to me the chasm between the home users who buy the stuff and the true audiophiles and sound engineers who won't touch it. In the long run, I suppose it is all subjective - if it sounds good to you, then your money is well spent. I just take issue with companies using suspicious claims to support their "innovative" technology.

Re:Amen, brother, Amen

[SQLGuru]

Pretty much. I read Slashdot for the commentary (filtered - who needs Trolls), not the articles.....even when the posts are offtopic (like this thread), they still can be insightful and interesting. If it's a slow news day or I don't want to do any work, Digg gets a little more action....but that's because they post anything.

Layne

Re:Monster cable has been taking advantage...

[91degrees]

and I'd be very surprised if Monster has a patent on that.

This is about design patents rather than a utility patents. It's probably more comparable to a trademark than a utility patent. An example of a design patent would be the Coca cola bottle.

Re:When I was more naive

[iluvcapra]

I would suggest getting all of your cables from Blue Jeans Cable [bluejeanscable.com] from now on. I know I will; Their prices for HDMI cables are almost as low as monoprice's.

Re:The word "owned" comes to mind

[mr_death]

There's no "sham company tax shelter methods" -- just the usual legal method of tranferring income from a high tax juristiction to a lower one. Companies and people do this all the time (e.g., US/Bermuda, California/Nevada) to avoid their biggest and unnecessary expense.

The threat here is not "you're going to jail", but "we're going to expose you to political ridicule for not passively bending over and paying whatever the government demand."

If you don't consider this method as a part of your tax planning, you're paying more than you need to. As Judge Learned Hand said, "Anyone may arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which best pays the Treasury; there is not even a patriotic duty to increase one's taxes. Over and over again courts have said that there is nothing sinister in so arranging affairs as to keep taxes as low as possible, everyone does it, rich and poor alike and all do right; for nobody owes any public duty to pay more than the law demands. Taxes are an enforceable action, not a voluntary contribution."
Helvering vs Gregory
60 Fed (2d) 809

Re:Monster cable has been taking advantage...

[pbhj]

97% of all electronic failure is the result of low or inconsitent power.

That's funny that's the same percentage as that of statistics made up in slashdot posts ...

Re:Amen, brother, Amen

[rk]

I've said it before, and I'll say it again. /. has more than its fair share of mouthbreathers, but compared to most online forum/blog type things out there, /. reads like de Tocqueville in comparison.

RTFA

[Thaelon]

I actually RTFA, and I must say without reservation that it is completely and totally worth reading the entire thing.

Re:Monster cable has been taking advantage...

[Anonymous Coward]

It is called a computer UPS, and a small one can be bought for about $40.

UPSs will bump power up if it goes too low and cut it if it goes too high (and go onto battery).

In fact, the more recent APC UPSs you can set what voltages you want as your thresholds. $200 my ass.

Re:The word "owned" comes to mind

[Kozar_The_Malignant]

"Not only am I unintimidated by litigation; I sometimes rather miss it."

I hate to be that guy, but the fellow who wrote that letter doesn't understand how to use a semi-colon.

"Use a semicolon between the clauses of a compound sentence when the conjunction is omitted or when the connection is not close." (Taintor and Monro, 1988, The Secretary's Handbook) The writer has used a sentence of the "not only, but rather" from and used a semicolon in place of the missing conjunction "but".

Re:Monster cable has been taking advantage...

[bonehead]

Nobody is claiming that digital is foolproof.

What's being stated, which is a fact, is that with a digital signal, if you're not seeing and/or hearing a blatantly OBVIOUS problem, then higher quality cables will offer you NO benefit.

A $200 HDMI cable will not offer a sharper or brighter picture than a $10 cable. It will produce the EXACT SAME picture. (Provided the obvious assumption that the $10 cable isn't so extremely substandard that it's producing obvious flaws in the picture.)

Re:The word "owned" comes to mind

[jonbryce]

It isn't illegal per se. However there are at least two issues that need to be considered.

One is "transfer pricing". Is Monster IP Bermuda Ltd charging Monster Cables Inc too much for the patent licenses? If so, they will be in trouble with the IRS. That what he talks about when he refers to "bona fide arms-length transactions". It has to be the same as what, for example, Belkin would be willing to pay to license the patents.

Secondly, the Bermuda company may be resident in the US for tax purposes. I'm not familiar with the US rules on residence, but in the UK, an offshore company is resident in the UK for tax purposes if it is controlled by persons who are resident in the UK.

Re:Monster cable has been taking advantage...

[meringuoid]

Wrong! In this post-9/11 control-by-fear world, the average person would take one look at an oscilloscope and run away screaming that there is a BOMB in their HOUSE!

While true, this is awfully strange, since no bombs were involved in 9/11 in any way :-)

Re:The word "owned" comes to mind

[ChaoticLimbs]

No, you see, if they abandon their effort, Tartan can still pursue them for improper business practices, vexatious litigation and antitrust violations. It's beautiful. If they pursue it, they risk damaging future cases, and if they drop it, it becomes apparent that they merely intended to put out meritless claims, hoping that others would settle. Doing that would be a clearly improper practice, and they can be placed under injunctions to prevent them from doing it to others. It's LOSE/LOSE for Monster.

Re:My favorite quote

[Daniel Dvorkin]

Even if Blue Jeans is public, if the shareholders have any brains, they'll support his stance. This isn't just a matter of principle (although it is certainly that) but also a matter of cold hard cash. Blue Jeans will in every way do better by standing up to the aptly-named Monster than they would be settling.

Patent trolls the same as spammers?

[trawg]

There appears to be a remarkable resemblance between patent trolls and spammers in that they both appear to like sending things like this out to as many people as they can and just playing the numbers. I'm sure Monster have done this before and either gotten the other entity to just roll over and play dead, but really - they can just spam things like this out to as many people as they want and hope that they can get enough of a percentage of success to make it profitable as its own business process.

Admittedly its more expensive than the near-zero cost of spam, but the principle is the same.

Re:The word "owned" comes to mind

[Z34107]

Ouch, mods.

But, the long string of semicolons is separating a list of lists. He describes in comma-delimited clauses each aspect of the cable, and separates the clauses themselves with semicolons.

Re:The word "owned" comes to mind

[TerranFury]

*sigh*

It is perfectly good English.

Semicolons do roughly the same thing as periods; they're just not a full stop. They're wonderful things because they allow you to imply logical connections between ideas without getting bogged down in really pedantic conjunctions. Just take two clauses and put a semicolon in-between; you've just implied a relationship between them!

Embrace the semicolon! Don't overdo it of course, but that goes for most things in life!

Re:The word "owned" comes to mind

[Anonymous Coward]

Hm. And the burden of getting my taxes straight lies solely on me... some average joe.

Makes perfect sense, no?

Perfect!

[chrispycreeme]

I just found my new favorite cable company! You can't buy advertising like this, Blue Jeans Cable must be thrilled.

Wow, what a letter!

[dwiget001]

Two things I got from it: 1) You are messing with the wrong guy. 2) I am putting my balls on the table. Go ahead, kick/smash them. I will make sure that the resulting damage hurts you a lot more than it hurts me.