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Patents The Courts The Almighty Buck United States

Kaspersky Lab Forces 'Patent Troll' To Pay Cash To End Case (arstechnica.com) 108

In October, Kaspersky Labs was sued by a "do-nothing patent holder in East Texas who demanded a cash settlement before it would go away," reports Ars Technica. Today, founder and CEO Eugene Kaspersky said his company has defeated five patent assertion entities, including the infamous claims from Lodsys, "a much-maligned patent holder that sent demand letters to small app developers." The patent-licensing company who sued Kaspersky Labs in October was not only defeated, but they ended up paying Kaspersky $5,000 to end the litigation. From the report: The patent-licensing company, Wetro Lan LLC, owned U.S. Patent No. 6,795,918, which essentially claimed an Internet firewall. The patent was filed in 2000 despite the fact that computer network firewalls date to the 1980s. The '918 patent was used in what the Electronic Frontier Foundation called an "outrageous trolling campaign," in which dozens of companies were sued out of Wetro Lan's "headquarters," a Plano office suite that it shared with several other firms that engage in what is pejoratively called "patent-trolling." Wetro Lan's complaints argued that a vast array of Internet routers and switches infringed its patent. Most companies sued by Wetro Lan apparently reached settlements within a short time, a likely indicator of low-value settlement demands. Not a single one of the cases even reached the claim construction phase. But Kaspersky wouldn't pay up. As claim construction approached, Kaspersky's lead lawyer Casey Kniser served discovery requests for Wetro Lan's other license agreements. He suspected the amounts were low. Wetro Lan's settlement demands kept dropping, down from its initial "amicable" demand of $60,000. Eventually, the demands reached $10,000 -- an amount that's extremely low in the world of patent litigation. Kniser tried to explain that it didn't matter how far the company dropped the demand. "Kaspersky won't pay these people even if it's a nickel," he said. Then Kniser took a new tack. "We said, actually, $10,000 is fine," said Kniser. "Why don't you pay us $10,000?" After some back-and-forth, Wetro Lan's lawyer agreed to pay Kaspersky $5,000 to end the litigation. Papers were filed Monday, and both sides have dropped their claims.
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Kaspersky Lab Forces 'Patent Troll' To Pay Cash To End Case

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  • ROTFL - no NDA? (Score:4, Interesting)

    by thesupraman ( 179040 ) on Wednesday August 30, 2017 @08:51PM (#55113987)

    And the patent troll forgot to include non-disclosure it seems.
    Obviously quality lawyering there.. Smart, Real smart.

    But lets not forget, Kaspersky is EVIL now remember? EVIL RUSSIANS!

    How dare they try and undermine such an upstanding and fine American institution as patent trolling!

    • Re:ROTFL - no NDA? (Score:5, Insightful)

      by lucm ( 889690 ) on Wednesday August 30, 2017 @09:13PM (#55114073)

      We need evil Russians, that's the only way we can keep the content of leaked DNC emails buried under a thick layer of mass hysteria. They're also very convenient as a distraction for people who still have their panties in a bunch because they lost their elections to a reality TV star.

      • Re: (Score:3, Interesting)

        by AC-x ( 735297 )

        Because things the Trump administration stand for like destroying net neutrality are so good for the tech industry!

    • by Anonymous Coward

      Poor old Eugene. He's dealt with this kind of hysteria before, from Russia as much as anyone else. He's dealt with worse from them than hysteria too.

      Security is a bum game, there's always someone trying to gain political leverage in a way that undermines your good work. You're best off either being as fake as possible like John Mcafee or completely invisible.

    • Re: (Score:1, Interesting)

      by rtb61 ( 674572 )

      The real patent troll is the USPTO. Clearly it is far right psychopathic policy to allow as many patents through as possible regardless of validity, basically the plan a US tax on the rest of the patent. They make money out of approved crap patents, they make money for their lawyers and courts and of course they run extortion schemes for as long as possible tied to bad patents. This is clearly no an isolated incident but reflects a long term pattern of extremely corrupt behaviour by an extremely corrupt gov

    • Other litigation from "payees" which will hopefully put one (of unfortunately many) patent troll out of business. I would also hope that the people bringing fraudulent litigation against companies see at least the threat of criminal charges for fraud.

    • by ls671 ( 1122017 )

      Comrade, our land doesn't have nuances such as yours. e.g. France helping you to separate from England. Your flag has been showing the same blue-white-red colors as France ever since then as recognition. Of course, the number of stars on the flag has varied.

    • Re:ROTFL - no NDA? (Score:5, Insightful)

      by thegarbz ( 1787294 ) on Thursday August 31, 2017 @03:56AM (#55115031)

      How dare they try and undermine such an upstanding and fine American institution as patent trolling!

      They didn't. They made the patent troll part with $5000. A responsible company would have gone to court and get all the patents invalidated to prevent the troll feeding on other victims.

      • by Megol ( 3135005 )

        You don't understand what a company is _for_, that's obvious. They aren't created to make the world a happy place.

        • I understand exactly what a company is for. I also understand why therefore they should not be put on some pedestal. They did the bare minimum and even scored $5000 for their efforts. Nothing more.

          No trolls were hurt in the making of this crappy story, and Kaspersky deserves absolutely no credit for anything.

  • Sweet (Score:5, Interesting)

    by AlanObject ( 3603453 ) on Wednesday August 30, 2017 @08:52PM (#55113995)

    Now we know what law firm to go to if we are ever targeted by a patent troll.

    I've had a patent troll on my case before and it is one of the most annoying pitfalls of doing business in the USofA. The plaintiff was some invisible company that got ahold of some ARCnet patents from a defunct workstation maker and thought they could nail every Ethernet product maker. We were small potatoes they wanted 3Com and Intel.

    Fortunately this particular claim was so specious that it didn't go anywhere. Still annoying.

    What's your patent troll story?

    • Re:Sweet (Score:5, Insightful)

      by JaredOfEuropa ( 526365 ) on Thursday August 31, 2017 @07:13AM (#55115447) Journal
      They don't want 3Com and Intel because those companies would happily fight this thing to death in court. You got targeted because you are small potatoes, and presumable don't have the stamina or cash to go to court. For a big fish it makes financial sense to fight; for small fry it makes financial sense to pay up, the fee is probably less than your legal bills would be.
      • This.

        There's a word for what patent trolls do, and the word is "extortion". You don't extort from people who are likely to put up a fight.

      • They don't want 3Com and Intel because ...

        Actually I think they actually did. This is last century and the patent trolling industry was much earlier on. You are right that they did want us to buckle under and expected us to because we didn't have the resources to fight much. However not because they would really make any money off of us but because their strategy was to get enough companies like us so that it would bolster their claims against the big guys doing big volume.

        As far as I know that strategy doesn't work (today) but with what litt

  • by Anonymous Coward on Wednesday August 30, 2017 @09:06PM (#55114049)

    Every software patent. If you can't make a good case as to why you should have the patent, it's gone. I think we'd lose 99% of the patents, because 99% of them are bogus.

    • Why stop there? Investigate their partners too. Heck, investigate their whole family.
    • Personally, I think that 100% of software patents should be invalid, both for technical and legal reasons and because software patents cause a huge amount of harm to society.

  • by lucm ( 889690 ) on Wednesday August 30, 2017 @09:16PM (#55114081)

    The name of the inventor on this patent is Steven T. "Trolan".

    They're not even subtle about it!

  • How are software patents still a thing in these backwards jurisdictions?

    • by Anonymous Coward

      Because mystery magic science tech + old crotchety tech illiterate judges = settlements

    • Re:But how? (Score:4, Insightful)

      by Altrag ( 195300 ) on Wednesday August 30, 2017 @10:39PM (#55114293)

      Mostly because its difficult to knock off the patent trolls that nobody wants, without also inadvertently harming the big patent holders such as Microsoft, Intel, IBM, etc who all hold hundreds if not thousands of patents that they don't actually practice in addition to the hundreds or thousands that they do practice.

      So you can't just add a law like "non-practicing patents are not actionable" or anything like that without pissing off those big campaign contributors and you end up in kind of an "I know it when I see it" scenario where its usually pretty obvious when someone is a patent troll, but writing it up in legal language that's both strong enough to matter and still specific enough to only harm the abusers.

      Of course the real solution is to just not issue shitty patents in the first place, or at the very least be more willing to invalidate them when its shown that they're shitty. That has the same issue of inadvertently harming the big political contributors though so its even less likely to happen since its basically the same solution just kicked up the line a bit.

      • by Altrag ( 195300 )

        writing it up in legal language

        ... is difficult.

      • Re:But how? (Score:5, Insightful)

        by Trogre ( 513942 ) on Wednesday August 30, 2017 @10:52PM (#55114323) Homepage

        *ahem*

        I don't disagree with what you wrote, but you seem to have missed the point.

        This is not about non-practising patents. This is about Software Patents, which are utterly immoral and should not exist in any form.

        • Amen.

          The ownership of ideas is immoral.

          • by Altrag ( 195300 )

            By what metric? Some cultures have historically treated the ownership of physical property as immoral. They've mostly all been wiped out by those of us who happily shoot anyone who infringes on our property rights, including people who don't believe in such.

            And other cultures (including our own!) have historically considered the ownership of people to be perfectly fine. We still have no problem with owning animals.

            Why should it be "immoral" to own ideas but fine to own livestock? Certainly current US la

        • by Megol ( 3135005 )

          IMO it's a gray zone. Using software just as using mechanics in a novel way in a novel system? IMO clearly worthy of a patent but (as Dog-Cow points out below) the source code should be included or at least a complete algorithmic description that others can implement and improve upon. But most software patents aren't like that.

      • Re:But how? (Score:4, Interesting)

        by whoever57 ( 658626 ) on Thursday August 31, 2017 @01:33AM (#55114747) Journal

        Mostly because its difficult to knock off the patent trolls that nobody wants, without also inadvertently harming the big patent holders such as Microsoft, Intel, IBM

        If all those large patent holders lost their patents at the same time, no one would be harmed.

        • by Altrag ( 195300 )

          Yes they would. They would all be harmed approximately equally to each other, but the real harm would be the sudden possibility of startups that no longer had to try and wade through the patent minefield, and fewer ways to strangle any startups that get past the "startup" phase and begin to look competitive.

          Of course in this case, I mean "harm" from the perspective of the companies in question. Society as a whole would likely benefit from the increased competition. Unfortunately the US government cares f

    • Re:But how? (Score:5, Informative)

      by thomst ( 1640045 ) on Wednesday August 30, 2017 @11:11PM (#55114369) Homepage

      Trogre asked:

      How are software patents still a thing in these backwards jurisdictions?

      Article I, section 8 of the U.S. constitution states that, among many other powers granted to it, Congress shall have the 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".

      Using another power granted to it by Article I, section 8, Congress created the now-voluminous corpus of Federal law known as the U. S. Code. Title 35 of that code - which has been amended several times since its inception - established the U. S. Patent and Trademark Office to administer the Federal grants of exclusive rights to authors and inventors. The duration of those grants is also set by Congress (and has been steadily increased with each revision to Title 35 since the passage of the first Patent Act in 1799). What "inventions" are eligible for patent protection is defined in TItle 35, beginning with section 101.

      Whether a patent application is granted or not is determined by patent examiners, who are members of the Patent and Trademark Office staff, and who are assumed to be competent to judge the patent-worthiness of an application. Decisions of patent examiners are subject to challenge - and patents wrongly granted can be recinded - but the process is cumbersome, lengthy, and expensive, so challengers without deep pockets and strong motivation are rare.

      Most knowlegeable parties agree the current system is profoundly broken, but, because it's up to Congress to fix it, and a lot of patentholders are also major political campaign finance contributors, nothing fundamental to that system has been seriously revisited in the context of lawmaking in modern times. Nor is it likely to be in the near future.

      IANAL ...

  • In Russia (Score:5, Funny)

    by neo-phoenix243 ( 1755766 ) on Wednesday August 30, 2017 @10:01PM (#55114193)

    In Russia, patent trolls pay you!

  • Good for Kaspersky! (Score:4, Informative)

    by mhkohne ( 3854 ) on Wednesday August 30, 2017 @10:27PM (#55114259) Homepage

    Way to go guys. Every time a troll gets his ass whooped, it's good for the rest of us.

    Thanks!

    • Way to go guys. Every time a troll gets his ass whooped, it's good for the rest of us.

      Thanks!

      No it's not. No one got their ass whooped here. Kaspersky had the chance to drag this to court and get the patents invalidated. Instead he made the company part with the Friday afternoon petty cash drinking fund and next week they're free to go find other victims.

      Kaspersky had the opportunity to do some good and instead took some money to go away and leave a patent troll be. Fuck both sides of this story.

    • by hAckz0r ( 989977 ) on Thursday August 31, 2017 @09:27AM (#55115943)
      I do give Kaspersky a lot of credit for standing their ground. Unfortunately the patent was not invalidated in the process and the troll can legally continue to extort money from smaller and less successful companies. Since the case was settled out of court, the court judge never had a chance to rule and legally invalidate the patent. Trolls don't just go away when they still smell money. Its a real shame Kaspersky couldn't take it one step further and put them out of business completely.
      • I agree. I imagine though that Kaspersky is not that interested in spending money in the US to primarily benefit US entities. Probably something about "the US gov sez avoid Kaspersky" disinclines them to do so.

    • Except nobody's ass got whooped. The troll had to pay an amount that is essentially chump change. They certainly didn't get hurt.

      Taking the case to court -- that would have resulted in an ass-whooping.

  • by xfizik ( 3491039 ) on Wednesday August 30, 2017 @10:44PM (#55114311)
    A Russian company with close ties to KGB exploits a loophole in US patent law, tries to bankrupt a small American firm struggling to make a living out of its intellectual property. The Congress will consider additional sanctions against Russia.
    • by Yurka ( 468420 )

      "A Russian company with close ties to KGB squashes a patent troll, remains a Russian company with close ties to KGB. The Congress will still advise anyone who's not out of their minds not to trust their computers to the Russian company with close ties to KGB".
      FIFY.

      • by amiga3D ( 567632 )

        The KGB and NSA aren't interested in trivial crap. Normal business is safe, just remember you're being watched by Big Brother and avoid anything that can get you in trouble.

  • Looks like it. The patent is still valid. Others might not be as resilient in fighting the patent. So the troll can continue to extort money from unsuspected victims.

    • by Megol ( 3135005 )

      Yes? However this should significantly weaken the patent in a reasonable court.

  • If not, this is just a bump on the road. Sure he lost 5.000USD now, but how much did he make.
    Trolls, spammers, marketing: they are all not that much interested in how many say no. They are interested in how many say yes.

    I am sure plenty of companies will be happy to pay 1.000USD to make the potential lawsuit go away when the initial demand was 50.000. They probably will even give their lawyer a bonus for bringing it down so much.

    And even if this was enough to make that one company stop, 7 others will pop up

  • This is great! I love it when a patent troll get's its collective ass handed to it! However, this story is indicative of a much deeper problem that exists in the US Patent system. It's become a method for lawyers to create patents over trivial things and sue for profit. Research into "prior art" by the US Patent Office is minimal at best, which the lawyers know and exploit. Another problem is the entire idea of software patents which have become ridiculous and have actually stifled innovation for fear of in
  • It's a shame... (Score:3, Insightful)

    by Euroranger ( 5023923 ) on Thursday August 31, 2017 @10:40AM (#55116355)
    ...they didn't take this court, win the case, and demand not just their fees and costs (which surely totalled more than $10K) but also asked for a punitive damages amount for this bullshit. That right there would have sent a message to these patent trolls that their particular brand of assholism could end up being costly. Would have been a nice PR boost for Kaspersky to be the ones to back down one of these fools.
  • This is not that great of a thing. That Kaspersky walked out with $5000 may be great for them, they got their pound of flesh, but a responsible company would have forced litigation and invalidated the patent so this troll couldn't do this to anyone else... My already neutral opinion of Kaspersky just got lower. Seeing who is better at shaking the other down for money is a third world tactic. Here in the West we try to strive for fair play (in theory).

  • It's too bad that Kaspersky took the money (and such a small amount of it, too). It would have been to the benefit of society at large if they'd insisted on taking it to court.

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