Apple Settles Creative Lawsuit for $100 Million

E IS mC(Square) writes "CNet News reports that `Apple Computer and Creative Technology have agreed to settle their legal dispute over music player patents for $100 million, the companies announced Wednesday. The $100 million, to be paid by Apple, grants Apple a license to a Creative patent for the hierarchical user interface used in that company's Zen music players. The patent covers an interface that lets users navigate through a tree of expanding options, such as selecting an artist, then a particular album by that artist, then a specific song from that album. Creative filed for the patent on Jan. 5, 2001. Apple can get back some of the $100 million payment if Creative is able to secure licensing deals with other MP3 player manufacturers, said Steve Dowling, an Apple spokesman. "Creative is very fortunate to have been granted this early patent," Apple's CEO Steve Jobs said in a press release.`"

In Space...

Only a patent attorney can scream loud enough!

Doesnt it sound like...

""Creative is very fortunate to have been granted this early patent," Apple's CEO Steve Jobs said in a press release.`"

You can almost hear him whispering "motherfuckers!" under his breath after saying this.

Re:Doesnt it sound like...

I've had it with these motherfucking patents on this motherfucking planet!

Re:What goes around comes around

It's good to see companies which patent and sue about trivial ideas get sued themselves. Remember the trash can patent?

Is it?

It's not like that money comes from nowhere or means nothing.
Consider how many people 100 million dollars could employ.
Consider that nonsense like this is a direct disincentive to both innovation and copetition.

What you're saying is like saying that it's nice that heroin dealer got shot by herion dealer B. Is this really a good thing?

Re:What goes around comes around

Consider how many people 100 million dollars could employ.

Just one, but I'll work O/T and weekends too!

Re:What goes around comes around

Consider how many people 100 million dollars could employ.

A thousand perhaps?

The money didn't vanish, it moved. That same $100m should be able to employ equally as many people at Creative, or less better people or more worse people or whatever. For all you know that money was lining some bank account somewhere, which will now be $100m shorter with little affect on employees, whereas Creative will use it to create a thousand jobs (like perhaps a better Linux team)

I see it as the old, fair and friendly neighborhood heroin dealer shot the new fast talkin' "tough guy" heroin dealer (honestly, like Apple, the perfect and selfless angel was punched in the face by Creative, the big bad devil).

I like Apple, honest. I think Creative did an unethical thing with this lawsuit; and I agree with your reamark about it discouraging competition and innovation.

Now ask me if I think Apple did an ethical thing by flying into Creative's camp, pissing on their tent, and taking Creative's fair? share of Rio's MP3 player market. Hmm?

I have to assume Apple wouldn't visciously steal Creative's market share if "business" hadn't demanded that they take that opportunity. I also have to assume that Creative dislikes patents as much as you and I.

I'll bet most athletes, at times, dislike the fact that if they have less points than their opponent, they lose. They may have worked harder. They may have deserved it more. They may have wantedit SO much more. Their eighteen kids may be dying and only wishing to see their mother/father win, whereas their opponent's looking for their eighteenth win.

(point being, everybody has to play by the unfair rules, and $100m never just "vanishes" in a lawsuit between two giants, unless of course it's to a lawyer)

Re:What goes around comes around

While the money doesn't vanish, litigation is a leach on the system.
Lawyers don't produce anything and are only necessary because we can't just all get along.

Like the police: If everyone were law abiding we wouldn't need police and jails and courts and all the other fine expenses that go along with enforcing the laws.

For me, this is one of the things that is much overlooked in Intellectual Monopoly law: what is the cost of running this system to society?
Even assuming that patents do increase innovation (I don't believe they do) they also cause a drain of production resources in terms of legal costs, both to file and then to protect. This cost (along with other social costs, like increased prices of drugs etc) needs to be deducted from any gains that a patent system gives (and since I don't believe there are any gains to begin with, I think we have an overall loss...but that's just mho)

Re:What goes around comes around

Remember the trash can patent?

Yeah. It got thrown out.

Re:Doesnt it sound like...

Writing software for a Mac and/or Linux is a very different proposition from fabricating hardware for a niche music player.

As expensive as software development is, it doesn't really compare with tooling a factory for making hardware that works with a specific MP3 player, then programming the firmware for said device.

The iPod has been using pretty much the same dock connector for a couple years now, so if you make a gadget for the iPod dock connector there's damn near 50 million potential customers out there.

Creative has clawed it's way to be the biggest of "the rest of them" with the Zen (at least in terms of last year's sales), but I wouldn't be surprised if somebody came out with a statistic that said there were more iRivers out there than Zens. If you are going to go after the "not an iPod" market, your best bet is to make generic gadgets which plug into the headphone jack of any player, and don't rely on the manufacturer-specific features on one niche player.

The iPod is far from perfect. It needs more RAM, and still lacks gapless MP3 playback (a major buzz-kill), but with its market dominance and it's dock connector with standardized pin-outs, it's no surprise that it's what most manufacturers are building accessories for.

If I'm the CEO of "SuperCoolOggAndMP3Players, inc.", I'd be talking to Apple about licensing the iPod dock for my player. It probably would not be a cheap deal, but it would give me a leg up over Creative and all the other also-rans out there, including the upcoming players from Microsoft.

Then again... being a sore loser, rolling on the ground kicking and screaming, and extorting $100,000,000 out of a company would probably make Creative more money than their iRivers ever would. Maybe frivolous corporate lawsuits are the future of "competition".

Re:Doesnt it sound like...

Actually, to me it sounds like he is saying touché.

Re:The camel, the back, the straw...

Maybe I'm overreacting, but hey. Fuck them.

No, you are not over reacting. This is the feedback system for corps. If they misbehave, we the customers, have the option -the obligation- to vote with our wallets. Lawsuits, and petitions, and letters to the board are nowhere as simple and effective as not spending money with them.

Good for you, and I will join you. Bad Corp, No Dollar.

Bless Apple Computers [i-bless.com]

Re:The camel, the back, the straw...

Even if everyone stops spending money on Creative products, and it won't matter. Sure, they'd have to trim down their product line to nothing, eventually, but a shell company and lawyers can subsist for a long time on nothing other than infringement lawsuits. Kind of like a cockroach living off the oil in your fingerprint, if you think about it.

OK then, $100mill question

so does that mean Creative invented the treeview, or the database search?
cuz billions of programs out there may be affected by this.

Re:OK then, $100mill question

Since this case was settled, it doesn't mean anything. It just means Creative was willing to drop the lawsuit for $100 million.

Pay. Counter License. Smile.

Step 1. Pay Creative 100M

Step 2. License offending patents to Creative for 150M.

Step 3. There is no step 3.

I suppose it's a new version of Rip. Burn. Mix.

Somebody is soon going to get a patent ...

... for an anatomical opening to expel the byproducts of digestion and sue everyone in sight with an a*****e.

Creative got a patent on that?

My mp3 collection has been arranged like that in my filesystem since 1999. Does that mean that my file manager infringes on Creative's patent?

This is BS

100 million is a pretty big payout for an obvious way to navigate through music that I myself invented when I was a kid. This method is: "The patent covers an interface that lets users navigate through a tree of expanding options, such as selecting an artist, then a particular album by that artist, then a specific song from that album."

I mean, isn't that how the stuff is organized in the record store too?

  "No wireless. Less space than a nomad. Lame." 100 million dollars in patent taxes lame.

Re:This is BS

don't be a prick. the text of the patent could be directly interpreted as "selecting an artist, then a particular album by that artist, then a specific song from that album" as the parent posted. just because you dug up the verbose text doesn't change what it is.

and yes, it's a pretty fucking obvious way to categorize and navigate through digitally stored music.

just about every ripper i've used has an option to create artist then album directories to contain the actual song files - so just putting a folder of ripped tunes behind a web server infringes on creative's patent? that's BS, completely fucking obvious, and never should have been granted as a patent.

the question now is, who has the patent on doing this with video?

Re:This is BS

"Check your assumptions."

Check your own. Over the years I have read many hundreds of patents, discussed patent law and economics at length with experts in both patent law and patent system economics and read more books and papers on those subjects than I care to recall. Certainly enough to know when I am reading absolute twaddle:

"The patent is very simple, broad, and blindingly obvious." etc.

None of which are grounds for expecting that such a patent would not be granted or that it would be easy or even possible to have it invalidated (let alone cost effective). Indeed the simplicity or broadness of a patent are utterly irrelevant to its validity and the meaning of "obvious", in the patent legal sense, has little to do with its colloquial meaning. There are no "contradictory facts" here and it has nothing to do with Apple's lawyers not being smart enough. If you know bugger all about patents and patent law, (or any other subject) don't assume that just because someone is posting on slashdot that they must be equally ignorant.

What amazes me

.. is that the idea was patentable. I mean come on... a simple heirarchical tree interface got patented? Who cares if it was for an mp3 player - does that make any difference? We've had tree interfaces for a while - its how many of us organize our music libraries (virtual and physical).

Re:What amazes me

Yeah, which is more scary:

1) that something *SO* obvious was granted a patent, or
2) that it was probably cheaper for Apple to pay $100 million rather than to try to prove it was that obvious in court.

prior art?

Didn't Apple's leagl team search the internet archives for prior art on this? There was a hack for the RIO300 that did this in 2000 and people begging for the option in 1999.
The SnowBlind Alliance was the place to get you linux friendly rio software at that time and they had lots of users asking for new features.

Re:prior art?

"Didn't Apple's leagl team search the internet archives for prior art on this?"

Occam's razor, my friend. Which is more likely to you:

1. It did not occur to Apple to search for prior art, or,
2. All the so-called "prior art" examples which you and others have pointed out, actually aren't applicable?

Whenever the subject comes up, various Slashdotters come up with lots of (sometimes laughable) claims of prior art. If only the patent were as simple as Slashdotters made it out to be.

Re:prior art?

probably cost more than $100 million to prove that in court

I'm not sure what your experience is with legal costs - but I'll give you mine, as an inhouse technology expert at a tier-1 law firm: Ok Tedi Mining and BHP - pollution of a river, the suing of a multinational (one that just yesterday posted a US$10 BILLION profit) in multiple states of Australia, involving the government considering legislation to prevent the lawsuit, had legal costs at the time of settlement, for both parties, of under US$15M (the settlement was for $110M).

Factoring in other things I find it very, very unlikely that the cost of proving such a claim would even come remotely close to exceeding $100M. If you look at a legal team billing $5,000 an hour (which would be a reasonable figure including paralegals, clerks, ancillary support staff as well as lawyers), for, say 60% of the cost, 10% as being court fees, and the remaining 40% as "expert/proof costs" (ie the technical research and findings, as opposed to the legals), that's still in the order of 5 years FULLTIME work by that entire legal team to even use up that.

Not impossible, but exceptionally unlikely.

If you ever wondered what is wrong with patents

This is a great example. The patent claims read just as described: how do you find a track to play using indexing.

Patents like this are not helping the public interest, but are simply ways for companies to lock out ideas without having to pay to develop them.

Time for the open source community to make "open patents" that are used to attack companies like creative that abuses them.

disgusting!

Patent for hierarchical user interface? Anything from a file system to nested menus is a hierarchical user interface. Oh but this one is used in a music player. That's where the innovation comes in.

The patent system is in need of a major reform. Currently when you are sued for patent infringement you have the burden to prove that either you don't infringe on the patent or that the patent is invalid. This obviously doesn't work. Instead, the patent holder should have the burden of proving that the invention is truly novel and non-obvious. The patent would simply serve as documentation proving when a particular thing was invented. The patent office would not need to examine patents for validity (i.e. it could continue doing what it's doing) since that would be established at the trial. This would cut down on the amount of "one-click" patents, reduce or even eliminate the need for defensive patents, and make patent trolling much more difficult.

Re:disgusting!

You don't have the slightest clue what you're talking about. (This is the 1 sentence that has replaced the 100 line flame that I just deleted.)

Patent for hierarchical user interface? Anything from a file system to nested menus is a hierarchical user interface. Oh but this one is used in a music player. That's where the innovation comes in.

I'm not sure what you're talking about but it is not the claims from the patent. If you'd like to respond, I'm going to require that you read the claims of the patent because otherwise you are literally wasting my time. Here is the link. The Patent [uspto.gov]

The patent system is in need of a major reform. Currently when you are sued for patent infringement you have the burden to prove that either you don't infringe on the patent or that the patent is invalid. This obviously doesn't work.

First, you are apparently unaware of a JMOL for clearly unreasonable patent infringement suits. Secondly, it's called "a defense". Technically it's optional.

Instead, the patent holder should have the burden of proving that the invention is truly novel and non-obvious. The patent would simply serve as documentation proving when a particular thing was invented.

It's called "patent prosecution" and it's the only way to get a patent in the United States. Clever idea.

The patent office would not need to examine patents for validity (i.e. it could continue doing what it's doing) since that would be established at the trial. This would cut down on the amount of "one-click" patents, reduce or even eliminate the need for defensive patents, and make patent trolling much more difficult.

(I've already deleted 100 lines of flame but let me say) I don't believe for a second that you have the slightest idea what is or is not a valid patent. Secondly, I don't think you have put any thought whatsoever into how you would prove or disprove this at a trial from scratch. (I say my patent is valid. We're done. Oh no - suddenly someone has to prove it's INVALID - we're right back to the problem you claim to have solved.) I think that you are unaware that patent prosecution before the patent office takes anywhere from 2-6 years. You suggest we move that (or some variant) into the COURTROOM? Are you trolling? Thirdly, you have begun your paragraph with a groundless conclusion and end it the same way - how in God's name would this make trolling any more difficult? Under your system, I don't even need to WIN the infringement suit, I can simply tie up your exorbitantly expensive legal team for an additional 5 years. It's legal extortion at its best.

I know this post is not very nice but please bear in mind that what you've read is completely rewritten. I don't intend to flame, but I do think you're completely out of your element. The bottom line, for me, is that I really wish Slashdot would stop carrying stories about patents because misinformation and worse is consistently moderated to the top. Without a doubt, Slashdot is the Fox News of patents.

All your patents are belong to us

I have three fears with every line of code I write:

- It is buggy
- A better block of code already exists in SourceForge or somewhere else on the Internet
- It is stepping on one or more patents for completely obvious or barely novel ideas

I believe at this point paranoia is not only rational but optimistic and gin and tonic are my only defense since I can't afford lawyers, guns, and money.

Re:All your patents are belong to us

I wonder if your fear #3 is grounds for challenging current patent law. I mean, the constitution says the congress shall have power:

To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;

I believe at this point paranoia is not only rational but optimistic and gin and tonic are my only defense

If it can be demonstrated that the current law is HAMPERING the progress of science, would that not make overreaching patent law unconstitutional? That may be a hard case to make, but I bet there is a ton of evidence to support the premise, from scientists who are afraid to invent or publish, programmers who are afraid to release code, corporations which sit on inventions rather than exploit them, etc. Would not a climate of fear engendered amongst Authors and Inventors not be hampering the progress of science and the useful arts?

Incidentally, I note that the constitution specifically refers to "writings and discoveries." What is the "discovery" related to this particular patent?

W

Re:patent law already blocks the "obvious"

If more people/companies challenged the 'fork and knife' patents, fewer companies would abuse them.

I believe you mean: An apparatus to divide food into portions of arbitrary size, by keeping the initial portion in place by holding the handle of the multi-pronged device, while simultaneously grasping the handle of the bladed device, and moving the thin or serated edge back and forth in a sawing motion against the food, and subsequently introducing those portions into an oral oriface using the multi-pronged device, or leaving them in their original position, or thereabouts, as desired, by firmly pressing one part of the bladed device against the portion to facilitate removal of the multi-pronged device from the aforementioned portion. Patent(s) pending.

The US patent problem

Puh-leez. As you can plainly see in this example [glitter-graphics.com], Creative is represented by the stick-man with the small ... stick, Creative's legal staff is represented by the stick-devil, and Apple is represented by the two stick-men who appear in the beginning. Any questions?

I think Despair.com said it best in their half-hearted, but sadly successful attempt in patenting the frowny-face emoticon. [despair.com]

If that's not screaming failure in our U.S. government, I don't know what is.

A little obvious don't you think?

"The $100 million, to be paid by Apple, grants Apple a license to a Creative patent for the hierarchical user interface used in that company's Zen music players. The patent covers an interface that lets users navigate through a tree of expanding options, such as selecting an artist, then a particular album by that artist, then a specific song from that album."

WTF??

What happened to the "non obvious" requirement for a patent?

Does this patent cover other obvious menus systems? Like say an automobile supply program. You pick a year then a car manufacture then you can pick a model then you can pick an engine type and finally a carburetor.

How obvious does it have to get before the patent processors put down their rubber stamps and reject the application?

Jobs is an idiot

Jobs is an idiot for thinking the issue is that Creative got the patent so early.

At issue here is that merely taking centuries old data organization methods and implimenting them into an electronic gizmo is NOT worthy of a patent.

Hierarchical indexing has been around since the middle ages.

Non-obvious to someone skilled in the art?

If I recall correctly from reading and a bit of training we were given at my company, this is supposed to be the guideline for validity of a patent application. I would think that if you asked just about any computer geek in 1995 to come up with a way to navigate a large music library, a hierarchy would have been the result. This is also how I used to arrange my mp3s before there were nice frontends, as a directory of Artists with subdirectories for Albums for each artist.

Re:Non-obvious to someone skilled in the art?

What I learned from my company (by seeing it done before my very eyes) was that you get a patent on what will do the most to hinder the competition, regardless of whether it is an innovative part of the design. It's up to the attorney writing the patent to hype up how it is innovative. Patents in the last several decades get pushed through with little or no regard to the "Non-obvious" and similar clauses. I and a co-worker have two patents, each in both our names and we had nothing to do with choosing what areas were patented. FWIW, the complete schematic and an attorney-digested (i.e. expanded in to legalese/patentese) descripion of the complete device's operation were put into the patent. I could show you what I and the other engineer thought were the innovative parts, but those weren't what got patented.

If you can get a patent on a method for growing broccoli sprouts, go for it - it will only take the rest of the broccoli sprout industry going to court to get it declared invalid. Yes, it happened, google for the story.

Bad news for the rest of us ....

> "Creative is very fortunate to have been granted this early patent,"

The battle lines have been drawn. I can almost see people inside Apple debating the use of patents as the Nuclear Weapons of this war - mutually assured destruction - you sue me, I sue you.

And it would be a bad thing if Apple started patenting user interfaces ... really.

Re:Bad news for the rest of us ....

"And it would be a bad thing if Apple started patenting user interfaces ... really."

Maybe that's a joke that went right over my head, but Apple is quite well known for patenting user interfaces. For instance, nobody else is allowed to depict a hard drive as an icon that looks like a photo or an illustration of a hard drive, because Apple has the patent on it.

Here are some examples:

• D523,441: Icon for a portion of a display screen
• 7,064,759: Methods and apparatus for displaying a frame with contrasting text

This is a case of "live by the sword, die by the sword."

Well.... there's gotta be a reason

Personally, I think the devil is in the details we weren't told. Such as Apple validates Creatives patent and makes a deal where it won't be granted to Microsoft.

Re:Well.... there's gotta be a reason

Good point.. By licensing the patent, they are legitimizing it. The net effect is that it creates a big barrier to entry for new competitors. This is easy to do when you're the dominant player already seeing tons of revenue. Paying millions in licensing is a non-starter for the small innovators looking to enter that market.

Re:Well.... there's gotta be a reason

Heh. Most of the press copied this line from the Apple/Creative press release:

Apple will pay Creative $100 million for a paid-up license to use Creative's recently awarded patent in all Apple products.

They were in a hurry, though, and not many caught this:

Apple can recoup a portion of its payment if Creative is successful in licensing this patent to others.

So, Creative now has cash in the bank, 'validation' of its patent with a license from Apple, and an incentive to go forth and seek licenses from others...

Then there's this:

In addition, the companies announced that Creative has joined Apple's "Made for iPod" program and will be announcing their own iPod® accessory products later this year.

Apple puts money into Creative, Creative makes iPod accessories, and a cut of the accessory revenue goes back to Apple.

So... Apple gets rid of some lawsuits, sets things up to make trouble for some other music player makers, and gets another revenue stream. All in all, this doesn't look too bad as a business move for Apple.

Watch out!!

The patent police have commenced random inspections of CD collections.

If you sort your CDs alphabetically by artist and album you will be sued for copyright infringement. You have been warned!

That's a lotta cabbage!

That's going to wipe out the profit margin on sales of 20-30 ipods!

What *I* want to know is...

... who holds the patent on using the WM_PAINT message to detect when a portion of an application's window needs to be redrawn. Clearly, someone other than Apple owns this patent, and is refusing to license it to them, because the Windows version of iTunes has been plagued with gaping areas of blackness since its first release.

I mean, come on... does nobody at Apple own a copy of the freaking Petzold book?
</rant>

No, the patent system isn't fubar at all...

yeah, I have nothing more to say. And I'm even mac-hostile.

really good chess move by Apple...

I think this post at MacRumors hit the nail on the head:

http://forums.macrumors.com/showpost.php?p=2752753 &postcount=115/ [macrumors.com]

So, in summary...

Apple pays Creative a one time fee of $100M to licence their patents.

Creative joins the 'Made for iPod' program making accessories for their competitor, Apple, who gets money for 'Made for iPod'.

Creative still HAS to defend it's patent against other competitors - that's the nature of patents - or licence it to them. If they do, Apple takes some of that money too. In a round-a-bout way, Apple is getting money back from it's competitors. Nice.

Creative have a much better case because Apple settled.

Creative still owns a valid patent. If Apple had won, there would be no patent so anyone could copy the Creative/Apple style interface.

Apple continues on as if nothing has happened. No long court case delaying sales. No injunctions to halt imports.

Explain to me why people think Apple lost here?

Creative knew it was about to get reamed by Microsoft's Zune which it's players aren't compatible with. They knew to get out of the market. Instead of legitimising Microsoft's offering, they've tied up with Apple. It might bug us that Apple have legitimised a bogus patent but it's otherwise very, very smart.

I think the thing that people are forgetting here is that by settling Apple is pretty much making Creative defend this patent, essentially outsourcing the litigation - they pay nothing for that. If Creative does not defend the patent, or loses any case setting new precedent, Apple could conceivably sue to get the $100 million back.

Plus, they get back money, as stated above, for the 'Made for iPod' program that Creative is now a part of, and the iPod ecology is enhanced. They have taken on a partner here.

This is a win for Apple thinking long term. Good chess playing.

Maybe it's not about Apple at all

From the settlement, "Apple can get back some of the $100 million payment if Creative is able to secure licensing deals with other MP3 player manufacturers"

So, if Creative licenses its IP to other manufacturers, Apple gets a slice of the pie. If Creative sues manufacturers who refuse to license, it's got the Apple precedent to tilt things in its favour. Maybe a slice of that pie is part of the unannounced terms, too.

If I were Creative, I'd be miffed that, having joined the Microsoft Playforsure camp, Microsoft then went on to develop its own PMP. In fact, I'd be tempted to piddle in Microsoft's pot by getting MS to pay a hefty licensing fee or suing it, as needs dictated.

MS will be more likely to license (i.e. "pay money to make the problem go away") knowing that the market leader has stumped up.

What?

Even Sony has one of these. The Sony Bean MP3 player has a menu feature exactly as a tree, and I don't see them getting sued (I would want to though...).

What is the infringement?

I think it's more than just the "hierarchical organization of music" that is being disputed. There are also glaring similarities between the interfaces on the two systems. For example... http://www.grumet.net/weblog/archives/images/mini- v-zen.jpg [grumet.net] (not my photo)

$100m = $0.12/share

Given that Apple has about 853m shares outstanding, $100m dollars works out to be $0.12 per share, or 0.18% of their stock price ($67). This shouldn't be a big deal for Apple.

The settlement shouldn't have been for money.

Apple should have agreed to license Fairplay to Creative so that their devices could play music from the iTMS. In fact, they should offer to do so for every company that is not currently making a device that rhymes with "boon". I've posted an open letter to Apple which discusses the need to cut Microsoft off from their ability to buy their way into the digital music market. You can read it here. [newsvine.com]

Link to the actual patent

Patent 6928433 [uspto.gov]

The key claim is the following, plus 15 variations on the theme.

What is claimed is:

1. A method of selecting at least one track from a plurality of tracks stored in a computer-readable medium of a portable media player configured to present sequentially a first, second, and third display screen on the display of the media player, the plurality of tracks accessed according to a hierarchy, the hierarchy having a plurality of categories, subcategories, and items respectively in a first, second, and third level of the hierarchy, the method comprising: selecting a category in the first display screen of the portable media player; displaying the subcategories belonging to the selected category in a listing presented in the second display screen; selecting a subcategory in the second display screen; displaying the items belonging to the selected subcategory in a listing presented in the third display screen; and accessing at least one track based on a selection made in one of the display screens.

It really is as daft as it sounds.

Hrm...

Looks like CREAF is on track to lose ~$118 mil this year. [google.com] Coincidence? Suddenly they are only losing $18mil..

It's a trap

The whole purpose was to legitimize the patent in order to slow down competitor number 3, 4 and 5.

CHOICE 1: Get the patent squashed, anyone can copy.
CHOICE 2: Settle in order to legitmize the patent, share the toll booth.

This is most likely a move to keep sandisk at bay with that new look alike. ...Of course that ALL look alike though.

They patented a menu...

"patent covers an interface that lets users navigate through a tree of expanding options"

Let me get this straight: Creative got a patent on a menu.

wow. I am in awe of their technical prowess.

What the FUCK?!?!?

The patent covers an interface that lets users navigate through a tree of expanding options, such as selecting an artist, then a particular album by that artist, then a specific song from that album.

Didn't Xerox do that with their GUI? Don't most copiers and printers today do this with either a few button presses or a few screen presses? Select paper size button brings up a hierarchal menu for both different sizes, then the next logical step is orientation of the paper/text. No matter what, it's rather PLAINLY OBVIOUS TO ANYONE WITH COLLEGE-LEVEL ORGANIZATIONAL SKILLS. Why the fuck is Apple paying Xerox again? This method of organization has been around since the library's card-catalog.?

And no, I'm not an Apple fanboy. Go read some of my rather venomous posts against Apple.

I'm'a gets me some patent for...

"...using menus in any way, shape or form. But on, like, an electronic thingee! Which is the clever bit, and makes it patentable. Really."

Steve Jobs Pulls a "Godfather" on Creative

The settlement terms basically prove it. Regardless of whether Creative's patents were valid or not, Apple just performed a legal jujitsu. It basically allows Apple to use Creative to fight its battles. One, the settlement strengthens the validity of Creative's patents. Creative is now free to go after the likes Sandisk (which has overtaken it in marketshare in the last year) and iRiver. Most importantly, it allows Creative to throw a wrench into Zune's imminent launch. I bet Microsoft never saw this coming. If Creative was a starving pit bull that was going after Apple out of anger, Apple just whipped out a nice juicy steak at the last second, made friends, and is now about to sic Creative the Well-Fed Pit Bull on Sandisk and Microsoft. There's no doubt Apple's lawyers read Creative's lawyer the riot act. Patent battles are super expensive, and with Creative having to simultaneously sue Apple as well as defend against the counter-suit, the whole process would probably take 5 years or more and cost tens of millions of dollars. With Creative's sales shrinking quarter to quarter, it would be hard for the company to keep paying the lawyers over such an extended period of time. Last quarter's results kind of proved that. But I think what really made Creative see the writing on the wall is the sudden appearance of Zune. Zune is the classic Microsoft move of screwing its partners over once they've outlived their usefulness (or in this case, proved totally useless). Creative maybe would have been willing to stick it out were it not for Zune, but with Zune competing directly with Creative's own products, they must have realized the company would be dead and bankrupt in a year, and once the money is gone, so long lawyers! I'm willing to bet that virtually all the terms of this settlement were proposed by Apple. It makes Creative look like a winner when Creative will now be fighting battles on Apple's behalf. It also shows that Apple is serious about not letting the iPod give any ground in terms of marketshare. And it wouldn't surprise me if Creative's "Made for iPod" products quickly ends up outselling Creative's players. And unlike the music players, the accessories will probably be hugely profitable for Creative, which will just make Creative Apple's bitch in reality instead of just symbolically. I can't wait for the next headline, though: "Creative Sues to Stop Microsoft Zune." Steve Jobs IS the new Godfather!

We need more patent litigation

Adapted from my blog. [blogspot.com] I know this is blasphemous, but there isn't enough litigation over patents. By this I mean actual court cases, there are plenty of threats. Only 1.5% of all patents are litigated, and only .1% are litigated to trial (of that .1%, over 50% are invalidated). This is far too little. Let me explain.

We know the level of litigation is too little because of positive externalities associated with litigation. If the accusor loses, invalidating a patent benefits everyone, not just the firm that sues for the invalidation. If the accusor wins, clarity in validity also benefits others. So there is a free riding problem with litigation (especially since it is so costly).

Lets say I hold a patent on tennis shoes and I expect to make a million dollars from that patent. If another shoe maker named Nike sues me over the patent, how much would I be willing to spend to defend the patent? $999,999. How much would Nike be willing to spend to invalidate the patent? Invalidating the patent doesn't give Nike a monopoly, so assuming in a competitive model there are no (or lower than monopoly) profits for Nike. So Nike would be willing to spend less to invalidate the patent than I would to keep the patent valid. Thus it may in Nike's best interest to just license a completely ludicrous patent. That seems to be what happened here.

Not only is this litigation costly, but anyone found infringing on a patent in court pays TRIPLE the claimed damages! That is high stakes indeed. To add to this problem, the alleged infringer bears the burden of proof, that the patent is invalid or that they didn't violate the patent. The wording for proof is "clear and convincing evidence," that is strong wording. So it shouldn't be surprising to find that 95% of all defendants settle without going to court.

A good way to produce more clarifying litigation is to create incentives to litigate. One idea (which I think is a bad one) is to allow the government to challenge patents. A better idea is to offer a bounty on invalidated patents. One problem with the bounty idea is that mostly worthless patents would be invalidated this way, but if you limited the bounty to licensed patents, you could eliminate a lot of this problem. The bounty could be grant the patent to the challenger for a few years, or be a flat rate payment. Lastly, there are public interest groups already doing great work towards this end (such as the EFF and Public Patent Foundation), by funding them with incentives or grants we could improve the situation.

Another fix is to force firms to litigation. By capping the dollar value of settling, firms my opt for a court remedy rather than an out of court secret agreement. Limiting settling and other forms of collusion makes more information public, which can benefit more people.

The third option for getting more litigation is to reduce costs of litigation. Removing the 3X payout, decreasing the time in court, and changing the wording from "clear and convincing evidence" to something less strong. Even shifting some of the burden of proof towards the accusor would speed things along. One other option to make litigation more affordable is to penalize accusers for refuted claims--since the general practice is to claim as much as possible and see what sticks (see SCO for an example).

It is a crying shame that Apple just paid off the patent trolls here. Had they put up the $100 million into a legal fund and gotten this rediculous patent invalidated, it would have benefitted society. Who knows who else will get hit with this silly patent claim now? It isn't Apple's job to benefit society, but as long as we keep feeding the trolls, we'll have to keep paying.

Hierarchal file system

aren't the I've been sorting my music like this for ages gang kinda missing the point.

you have

Music > Nancy Sinatra > One More Time > roadblock
Music > Nine inch nails > Still > the fragile
Music > Nirvana > Nevermind > smells like teen spirit

etc.

now from your root folder, Music, how do you show all for genre "Alternative" , your Hierarchal file system can't , that's what the patent's for.

Granted, it's still bloody obvious, but it's a bit more involved than a Hierarchal file system

How do they get away with this obvious crap?

I mean, the hierarchical menu based upon any series of choices is totally obvious. The only thing valuable about it is that it is *proven* through the popularity of the iPod to be a good choice amongst the millions of ways you *could* have done it.

It's almost like they're patenting the success of something obvious, if it wasn't successful, there'd be no lawsuit and people would say "that's a dumb patent, OBVIOUSLY you should be able to select artist, then album, then song..."

Wow

Wow, I should patent something completely obvious too. $100 million for a hierarchical menu on an iPod?

Seriously when are we going to fix the patent laws in this country? This is just plain stupid.

Take care,

Brian
--
http://www.holdemtoolshed.com/ [holdemtoolshed.com]

Yippee: two 20th century icons join forces

What are arguably the two most creative forces in the 20th century- one revolutionized computers, the other rock music- are now going to work together, due sharing a company name. Hopefully together they comquer the out-moded 20th century mechanisms of distributing music, and come up with great solution for the 21st for getting music into hands of fans and compensating the musicians.

Apple Has Money

Apple has plenty of money to settle this lawsuit. Music [mobile-music.info]

In short

1. Creative gets awarded silly patent.
2. Apple uses something that falls under the patent.
3. Creative sues Apple.
4. Apple fights back.
5. Apple fights back.
6. Apple fights back.
7. Microsoft announces Zune, which uses something that falls under the same patent.
8. Apple settles for $100 million and sets a precedent.
9. Creative uses the precedent to sue Microsoft.

Another Worthless Patent

*sigh* Yet another patent that fails the "non-obvious" test... ranks right up there with Amazon's One-Click in my book.

Good move by Apple

Apple comes out looking good. Instead of wasting time with courts, they offer Creative $100M to STFU. This is a patent on a blatantly obvious navigation method and Creative ends up looking like the cry-baby schmuck. They clearly need the money, otherwise they would never have bothered with going after Apple. Apple says "whatever, here's your f*ing money, losers", and moves on to release the latest & greatest iPod and Creative's lame MP3 player, that no one will STILL know about, finally dies off.

I hope they make good use of this $100M...they sure need it.

Apple WANTS the patent to stay in place...

Has anybody considered that Apple doesn't want the patent to be thrown out? Since they settled out of court, they now have permission from Creative to use the organizational system, and they don't have to worry about any up-and-coming players using the same system. The best part about it is that Apple doesn't have to do a damn thing, because Creative will be the one policing the patent.

They patented the tree control ?

You have to be kidding

Apple stifles competition by paying Creative

My Subject line got lost. I said, "They patented the Tree Control?" I was thinking about what could possess Apple to actually pay Creative over the tree control. What it does do, is raise the bar for any manufacturer or programmer that wants to create a music device or program because they would probably end up paying creative an ungodly amount of money, which they might not be able to afford. So in affect, Apple caving in stifles competition. Apple can afford to pay this, but who else can?

Re:Downside?

Whats the downside?

The downside is that they'll grab back the $100M from their customers at the earliest opportunity. As if their products weren't already expensive enough...