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Patents The Courts

Cloudflare Pays First $7,500 Bounties In War Against Patent Troll (cloudflare.com) 35

Cloudflare declared war on a group of lawyers that files patent lawsuits against tech firms, by offering bounties for the discovery of patent-invalidating "prior art." Now an anonymous reader writes: On Thursday, Cloudflare announced it has paid out the first $7,500 to people who discovered documents that could help invalidate Blackbird's patents. The money is part of a $100,000 war chest the company announced this spring... The company said it is ready to launch individual challenges to specific Blackbird patents. The company believes it has enough examples of prior art on US Patent 7,797,448, "GPS-internet Linkage" and US Patent 6,453,335 (the one asserted against Cloudflare) to lodge a challenge.
"We have received more than 230 submissions so far," Cloudflare reports, "and have only just begun to scratch the surface."
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Cloudflare Pays First $7,500 Bounties In War Against Patent Troll

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  • by drinkypoo ( 153816 ) <martin.espinoza@gmail.com> on Sunday September 24, 2017 @11:54AM (#55254487) Homepage Journal

    As long as pathetically obvious patents like these are granted in the first place, it's always going to be whack-a-mole. And as long as the USPTO is funded by charging fees for granting patents (and not just applying for them) the situation will persist.

    • Where on the USPTO's fee schedule (https://www.uspto.gov/learning-and-resources/fees-and-payment/uspto-fee-schedule) do you see a fee for issuing a patent? There are fees for applying, fees for very large applications, fees to maintain an issued patent, but I see none for issuing a patent.

      • Patent examiners are remunerated based on how many patents they grant. Disallow a large number of patents because they're trivially obvious and you lose pay, or possibly get fired. Rubberstamp everything that crosses your desk and you get a performance bonus.

        This is not a system that produces good/valid patents.

        • by Entrope ( 68843 )

          Patent examiners are not the USPTO. They are employees of the USPTO, and the USPTO is -- contrary to drinkypoo's assertion -- not "funded by charging fees for granting patents". There are extensive fees for applying for a patent, but no fees are due upon grant of a patent.

          • Patent examiners are not the USPTO. They are employees of the USPTO, and the USPTO is -- contrary to drinkypoo's assertion -- not "funded by charging fees for granting patents". There are extensive fees for applying for a patent, but no fees are due upon grant of a patent.

            That's not true. [uspto.gov] The issue fees are not very high compared to the overall cost of prosecution, but they do exist. The issue fee is currently $960 for a large entity. [uspto.gov]

          • Patent examiners are not the USPTO. They are employees of the USPTO, and the USPTO is -- contrary to drinkypoo's assertion -- not "funded by charging fees for granting patents". There are extensive fees for applying for a patent, but no fees are due upon grant of a patent.

            To me, the word "granting" means "patenting process" regardless an application is granted. The overall cost to apply and get a patent is not cheap. And yes, USPTO is funded by itself [ipo.org] from their own revenue. They have their own budget [uspto.gov] which comes from their own revenue (fee collections).

            • You can insist that words don't mean what they do, but your mis-definitions would obliterate the distinction that drinkypoo was trying to make. He argued that the patent office should be funded by fees for things besides issuing patents, which is already essentially true. It's not clear that the "issue fee" is disproportionately high compared to the work it entails.

              • You can insist that words don't mean what they do, but your mis-definitions would obliterate the distinction that drinkypoo was trying to make. He argued that the patent office should be funded by fees for things besides issuing patents, which is already essentially true. It's not clear that the "issue fee" is disproportionately high compared to the work it entails.

                Nope, you are the one who misunderstand the post, and then attempt to misinform others. "Granting" in patent field means you attempt to get a patent whether the application is approved.

                And as long as the USPTO is funded by charging fees for granting patents (and not just applying for them) the situation will persist.

                What does that tell you? It meant the opposite from what you said. If USPTO keeps themselves funded by the fees, then the problem persists. There is no such thing that you claim about USPTO "should be funded by fees" at all because currently USPTO is funded by fees.

                • by Entrope ( 68843 )

                  "Granting" in patent field means you attempt to get a patent whether the application is approved.

                  That is not what grant [uspto.gov] means in the patent process. The patent grant is when the government (or other body) officially recognizes the inventor(s) as holding exclusive rights to the invention. That happens after the applicant files a patent application, after the government reviews the claimed invention and existing art, and after the government approves the issuance of the patent.

                  If what you say were true, the

        • Patent examiners are remunerated based on how many patents they grant. Disallow a large number of patents because they're trivially obvious and you lose pay, or possibly get fired. Rubberstamp everything that crosses your desk and you get a performance bonus.

          This is not a system that produces good/valid patents.

          Actually, patent examiners are remunerated based on how many patents they bring to a final disposition. That includes granting, but it also includes rejecting. Rubberstamp everything "rejected" and you'll get the same performance bonus.

      • There are fees for applying, fees for very large applications, fees to maintain an issued patent, but I see none for issuing a patent.

        Fees to maintain an issued patent after only three years, which amount to as much as the total filing fees. And anyone who wants to challenge the patent has to pay fees to cover those costs, so what are those fees for? What are you "maintaining"? Answer, the USPTO's budget.

        • by Entrope ( 68843 )

          The thing a patentee is "maintaining" is his or her exclusive rights to the patented invention. One must to pay every few years, and those fees escalate over the potential life of the patent, to defer people from maintaining or asserting patents that are not in live use. Those maintenance fees are a small fraction of the USPTO's budget, but even if they were the majority, it would not make correct your claim that "the USPTO is funded by charging fees for granting [emphasis in the original] patents".

      • by tepples ( 727027 )

        Where on the USPTO's fee schedule (https://www.uspto.gov/learning-and-resources/fees-and-payment/uspto-fee-schedule) do you see a fee for issuing a patent?

        Under "Patent Post-Allowance Fees" are several line items containing the term "issue fee". In addition, "fees to maintain an issued patent" apply only to issued patents, not to applications that do not result in issuing a patent.

      • Where on the USPTO's fee schedule (https://www.uspto.gov/learning-and-resources/fees-and-payment/uspto-fee-schedule) do you see a fee for issuing a patent? There are fees for applying, fees for very large applications, fees to maintain an issued patent, but I see none for issuing a patent.

        Try here [uspto.gov], where it says "issue fee".

    • I think the problem is the application fee is pretty cheap compared to the cost the submitter pays to the lawyers to submit it. The lawyers outgun the patent examiners and the result is the roughly 50% grant rate. The examiners are just not up to the task and as I recall, the patent office actually gives some of the fee to the treasury making the matter worse. If all the money for applications were used to examine it would be a start. Perhaps one approach would be you must file a bond of say 50K with each a

      • by Zocalo ( 252965 ) on Sunday September 24, 2017 @02:21PM (#55254995) Homepage
        I think the problem is more fundamental than that. By paying patent examiners to approve patents, you're also effectively encouraging them to fail to do their jobs properly and just rubber stamp any random patent that they review; whether or not the examiners are competent or not doesn't enter into it. The fix is to turn that on its head and pay the examiners a commission/bonus for each patent that they can find prior art on or find a justifiable reason to invalidate the claim. Better yet, start with a reasonable low fee and/or bond, but have the number of previous failed applications result in successively higher submission fees/bonds for subsequent patent applications. That way you don't discriminate against smaller inventors who may not be able to afford large application fees, or even larger companies that file a lot of valid patent applications, but you do have a clear financial deterrant against the patent trolls that churn out an endless stream of frivolous and/or over-reaching patents.
        • I guess you missed where I said the patent examiner keeps the bond if they find prior art, IE the reject the patent. Agreed though my 50K bonus per rejection is probably too high. 5K would be more reasonable.

          • by Zocalo ( 252965 )
            No, I didn't miss it, and I think the bond is potentially a good idea, but the problem isn't just turning it around to provide an incentive for examiners to reject bad patents - it's also figuring out a way to penalise the outright patent trolls and/or submitters of overly broad patents without placing an unfair burden on either lone inventors or the larger corporations/universities that produce genuine patent candidates in bulk. That's not entirely clear cut either, because for every pure patent troll, yo
        • Why the fuck should they be paid differently for accepting or rejecting an application? This isn't commission sales.

          They should be paid by hour or salary and apply appropriate resources for each application fairly.

          • by Zocalo ( 252965 )
            In an ideal world, yes. The examiners would do their supposedly pretty thankless jobs, and all the bad patents would be rejected while all the good ones would be approved - and since it is an ideal world everyone (except perhaps the submitters of rejected patents) would agree on which are "good" and "bad". Unfortunately, the current system in the US (and at various other PTOs) is to incentivise either approvals or throughput, both of which discourage fair evaluations, while a flat-rate salary system is po
    • Switch to a patent registration system, where the USPTO just registers your patent claim and then the holder must prove the patent valid when they attempt to use it (with no assumption of validity). It would be just like today (rubber stamp patents) but easier to challenge.
  • by Anonymous Coward

    On the one hand i hate patent trolls. But i also hate cloudflare since the daily stormer debacle.
    I guess in the end i hope cloudflare gets a pyrrhic victory.

  • Oh please, there are many millions of dollars on the table here. What they are paying out in bounties isn't even scraps, it's crumbs at best.

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