How Cloudflare Stood up to a Patent Troll -- and Won (cloudflare.com) 58
Cloudflare was sued by a notorious patent troll Blackbird Technologies in 2016. Instead of giving up to its demands, Cloudflare employed a different strategy. From a blog post: In October 2016, Blackbird was looking to acquire additional patents for their portfolio when they found an incredibly broad software patent with the ambiguous title, "PROVIDING AN INTERNET THIRD PARTY DATA CHANNEL." They acquired this patent from its owner for $1 plus "other good and valuable consideration." A little later, in March 2017, Blackbird decided to assert that patent against Cloudflare. [...] Companies facing such claims usually convince themselves that settlements in the tens or hundreds of thousands of dollars are quicker and cheaper outcomes than facing years of litigation and millions of dollars in attorneys fees. We decided we would do our best to turn the incentive structure on its head and make patent trolls think twice before attempting to take advantage of the system. We created Project Jengo in an effort to remove this economic asymmetry from the litigation. In our initial blog post we suggested we could level the playing field by: (i) defending ourselves vigorously against the patent lawsuit instead of rolling over and paying a licensing fee or settling, (ii) funding awards for crowdsourced prior art that could be used to invalidate any of Blackbird's patents, not just the one asserted against Cloudflare, and (iii) asking the relevant bar associations to investigate what we considered to be Blackbird's violations of the rules of professional conduct for attorneys.
As promised, we fought the lawsuit vigorously. And as explained in a blog post earlier this year, we won as convincing a victory as one could in federal litigation at both the trial and appellate levels. In early 2018, the District Court for the Northern District of California dismissed the case Blackbird brought against us on subject matter eligibility grounds in response to an Alice motion. In a mere two-page order, Judge Vince Chhabria held that "[a]bstract ideas are not patentable" and Blackbird's assertion of the patent "attempts to monopolize the abstract idea of monitoring a preexisting data stream between a server and a client." Essentially, the case was rejected before it ever really started because the court found Blackbird's patent to be invalid. Blackbird appealed that decision to the Court of Appeals for the Federal Circuit, which unceremoniously affirmed the lower court decision dismissing the appeal just three days after the appellate argument was heard. Following this ruling, we celebrated.
As noted in our earlier blog post, although we won the litigation as quickly and easily as possible, the federal litigation process still lasted nearly two years, involved combined legal filings of more than 1,500 pages, and ran up considerable legal expenses. Blackbird's right to seek review of the decision by the US Supreme Court expired this summer, so the case is now officially over. As we've said from the start, we only intended to pursue Project Jengo as long as the case remained active. Even though we won decisively in court, that alone is not enough to change the incentive structure around patent troll suits. Patent trolls are repeat players who don't have significant operations, so the costs of litigation and discovery are much less for them.
As promised, we fought the lawsuit vigorously. And as explained in a blog post earlier this year, we won as convincing a victory as one could in federal litigation at both the trial and appellate levels. In early 2018, the District Court for the Northern District of California dismissed the case Blackbird brought against us on subject matter eligibility grounds in response to an Alice motion. In a mere two-page order, Judge Vince Chhabria held that "[a]bstract ideas are not patentable" and Blackbird's assertion of the patent "attempts to monopolize the abstract idea of monitoring a preexisting data stream between a server and a client." Essentially, the case was rejected before it ever really started because the court found Blackbird's patent to be invalid. Blackbird appealed that decision to the Court of Appeals for the Federal Circuit, which unceremoniously affirmed the lower court decision dismissing the appeal just three days after the appellate argument was heard. Following this ruling, we celebrated.
As noted in our earlier blog post, although we won the litigation as quickly and easily as possible, the federal litigation process still lasted nearly two years, involved combined legal filings of more than 1,500 pages, and ran up considerable legal expenses. Blackbird's right to seek review of the decision by the US Supreme Court expired this summer, so the case is now officially over. As we've said from the start, we only intended to pursue Project Jengo as long as the case remained active. Even though we won decisively in court, that alone is not enough to change the incentive structure around patent troll suits. Patent trolls are repeat players who don't have significant operations, so the costs of litigation and discovery are much less for them.
Too many lawyers (Score:5, Insightful)
This is one of those unintended consequences of State and Federal funding cuts. Starved of funding colleges look for other sources of revenue. So now we've got a glut of lawyers. That drives down litigation costs for all sorts of nasty little things.
Hospitals have begun suing over medical debt. Sometimes as little as a few hundred dollars. Meanwhile in the South judges have found people who can't pay in contempt and put them in prison, effectively bringing back debtors prisons. Finally we've got prisoners picking fruit for farms, bringing back slave labor and indentured servitude.
And it's not necessarily any cheaper to defend from these lawsuits either. The person suing can afford a cheap, low rent lawyer because the risk of losing is pretty low. Just move onto the next victim. But for the defendant the risk of losing is _high_. So they're gonna need the best lawyers they can get. It's asymmetric warfare.
Re:Too many lawyers (Score:5, Insightful)
Re:Too many lawyers (Score:5, Insightful)
No mention of the legal system that allows this kind of crap? Especially for the case of patents, you can get a patent easily and cheaply for anything not too abstract, and then it's up to the person you assert it against to find prior art or otherwise invalidate it.
Is that really a problem with the legal system, or with the USPTO? It seems like it's a case of the USPTO not doing its job. Patent examiners are supposed to look for prior art, and they're also supposed to be qualified to do so.
There are no penalties for getting a patent on something which has obvious prior art.
The USPTO makes more money by granting patents with prior art than by denying them, because the appeals process involves fees [uspto.gov]. This is what happens when the patent office is funded by fees.
Virtually all problems with patents (and trademarks!) in the US are caused by a PTO which is broken by design.
Re:Too many lawyers (Score:4)
The problem with your theory is that the denials are what generate the appeals, not the allowances. Why would an applicant appeal a decision to grant him or her a patent? Even if you mistakenly consider inter partes review part of "the appeals process," there are slightly over a thousand of those filed every year- you could easily generate more fees from the other ~3M patent applications filed every year by increasing your rejection rate by 1%.
Heck, you could probably bring in more money in extension fees by hiring a contractor to drive the mail to Annapolis than you could in any iteration of "the appeals process."
Re:Too many lawyers (Score:5, Insightful)
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Ever thought about running for Federal office?
I don't say that in jest.
And these days your username is basically acceptable... (that's the jest)
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It's both. The patent system is so bad that I feel all existing patents should be invalidated as presumptively invalid, and every patent law since, say, 1860 revoked.
That said, the USPTO has been turned into a profit center, and profits from the issuance of patents, even those which are clearly invalid. The requirement of a working model of every patented item should be reinstated, but that would not suffice to fix the system. The motivational structure also needs to be redone, so that patents are free,
Re:Too many lawyers (Score:5, Insightful)
....Especially for the case of patents, you can get a patent easily and cheaply for anything not too abstract
Having submitted a number of patent applications, and having some succeed and some not, I can say with some confidence that you are wrong here.
What the patent inspectors are really good at is finding prior art in previously filed patents. What they are not good at is finding prior art that's not in previous patents. It doesn't matter how common or well known it is in the community or obvious to people in the community-- the patent office knows previous patents exceptionally well, and doesn't know the community practice at all.
The patent office's baseline approach is that if your invention has anything that even looks superficially similar to something somebody already filed on, it's up to you to show in detail how your patent is different.
Re:Too many lawyers (Score:5, Interesting)
That's a slight understatement, as it's better to claim they don't know common sense.
Method of swinging on a swing [google.com]. It's something a bored child would do, yet the patent was awarded. Perhaps it's a direct conclusion of having the swing in the first place.
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Hey that patent expires in about a year so I'll finally have new swinging options!
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Worse still. The process IS the punishment. Even if you win, as Cloudfare attests to here, you're still out thousands, hundreds of thousands, or even millions of dollars. 1,500 pages of legal documents for a two page verdict? Really? When any CompSci 101 student would look at it and not say, "That's obvious", but, "Well, of course, how else would you do it?"
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Not only that, but thanks in part to Reagan's reforms to make the patent office run more like a business, the patent office uses fees for operation expenses and they collect additional fees when patents are accepted, as well as for various things after they are accepted, like maintenance fees and exparte re-examination fees. So patent officials have an incentive to grant patents even if they are challenged later.
Re:Too many lawyers (Score:4, Insightful)
Finally we've got prisoners picking fruit for farms, bringing back slave labor and indentured servitude.
Prisoners fight fires in California for less than a dollar per day, and one day off their sentence for each day spent fighting fires. But then they're still barred from working for a fire department because of their conviction, even though they've been trained and have experience. If they're lucky they get a job with a private fire department, which is the opposite of progress — we shouldn't have any need for such things, and we wouldn't if we were willing to hire these prisoners as firemen.
But the mere existence of private prisons is slavery, too...
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Worst part is the involvement of judges in the prison industry, either as stockholders or accepting gifts.
https://www.rt.com/shows/sophi... [rt.com]
Re:Too many lawyers (Score:4, Informative)
Prisoners fight fires in California for less than a dollar per day, and one day off their sentence for each day spent fighting fires. But then they're still barred from working for a fire department because of their conviction, even though they've been trained and have experience.
This is incorrect. When I was a fireman with CalFire (née CDF) we had several crewmembers who were ex-prison firefighters.
Re:Too many lawyers (Score:4, Informative)
This is incorrect. When I was a fireman with CalFire (née CDF) we had several crewmembers who were ex-prison firefighters.
Sorry, I should have said that many of them are denied EMT licenses, and therefore can't get jobs as firefighters [usatoday.com] in most districts. It's not all of them, but it's enough of them to be noteworthy.
Re: Too many lawyers (Score:2)
You imply fire fighting is a public service. Ok. So, private fire fighting is bad... uhm ok. Public prisons good, private prisons bad. Ok. Buses are a public service. But, we have private buses... bad?
No, mostly ok. They bring people from A to B, usually no major damage done of you can't afford it. Some amount of regulation may be needed to keep it fair, though.
We have private cabs... bad?
Good. Same as busses, more or less.
Uber, Lyft, bad?
Yes. Leeches to society, they don't thrive by filling a need, but by ignoring (useful) regulation meant for public safety.
Private for profit hospitals, bad?
Yes. Nobody's life should be another man's profit. Living wages, yes, but not profit.
Insurance, bad?
Depends on the details, mostly ok-ish. Insurance exists to spread risks too large for single individuals.
Re:Too many lawyers (Score:5, Interesting)
Prisoners fight fires in California for less than a dollar per day, and one day off their sentence for each day spent fighting fires.
Volunteer. They are not required. It is completely optional. The alternative is sit in the cell and no money. Acting like it is "slave labor" isn't accurate at all, and is a complete disservice to the program. But I've come to expect that from people who only listen to their irrational emotions.
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Volunteer. They are not required. It is completely optional. The alternative is sit in the cell and no money.
Step 1, shit all over certain groups and individuals so that you've got plenty of people in prison
Step 2, now they're grateful to do a very dangerous job for slave wages
Step 3, profit!!!
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What "Groups" are we shitting on. I want specific laws that target the "Groups" you think are "Shit all over"
Re:Too many lawyers (Score:5, Interesting)
> we've got prisoners picking fruit for farms, bringing back slave labor and indentured servitude.
It never left. Every prisoner is legally a slave.
Amendment 13 of the US constitution:
"Neither slavery nor involuntary servitude, except as punishment for crime whereof the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction"
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Finally we've got prisoners picking fruit for farms, bringing back slave labor and indentured servitude.
Have you ever even talked to someone that has been in prison? The people I talked to claimed they would PAY a dollar a day to go pick fruit if they had the money. Being locked in a cell for years on end is insanely monotonous. The prisoners would jockey for the chance to pick fruit or pick up trash on a road crew. These sort of work details are coveted.
Again, I've not spent time in prison. This is just what I was told in a credible way by the people I know were there. Your angst sounds like that of a
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Profit? It costs upwards of $25k/yr to keep someone is prison. You think that's going to be recovered with a few weeks of picking apples?
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Uhm prison is supposed to be punishment as well as isolating a bad apple from the general population for everyone else's well being. What do you think the point of prison is?? It's not supposed to be fun and exciting.
So why is any convicted criminal released? Without rehabilitation, no wonder they cannot be trusted.
Re: Too many lawyers (Score:1)
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"Involuntary" has meaning. The Prisoners "Volunteer" (opposite meaning) to these opportunities. The fact that people have no comprehension of what the words actually mean and are basing their "interpretation" solely upon feelings isn't helpful.
This is further expanded upon by the phrase "except as punishment for crime whereof the party shall have been duly convicted". It is almost like the people writing the amendment knew that idiots would try to apply it to criminals. The issue here is that we've already
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Better than too few (Score:2)
Yes, lawyers are plentiful which drives their costs down. This is a good thing. It allows you to hire a lawyer without going bankrupt yourself.
Having too FEW professionals is bad thing. For example the US has a low supply of MDs. Supply low, demand high leads to costs flying out of control, which describes the US healthcare system.
Lawyers are too cheap, you say? (Score:2)
> So now we've got a glut of lawyers. That drives down litigation costs for all sorts of nasty little things.
So your central premise is that lawyers are cheap, it doesn't cost much to hire a lawyer to go through litigation. And therefore litigation is cheap.
Me thinks you've never hired a lawyer to litigate anything, if you think it's cheap.
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the point is that if companies begin to defend themselves then others will think twice about suing. Kind of like how Wal mart does business.
blackbird also had to pay a bunch of money to sue. if the risk of losing goes up, they will sue a lot less
Stomp the trolls (Score:3)
So Cloudflare properly defended themselves against a patent claim for something that is clearly not patentable under existing law, and won. Color me shocked.
The headline of the article clearly said "patent troll". if it had been a good patent of something "clearly patentable", that wouldn't have been a patent troll; tha would be an inventor using the system the way it's supposed to work.
It is important to stand up to trolls.
Let me know when they are successful in a REAL patent lawsuit for something that is actually a real patent.
If they had stood up and won against something that was patentable and was (in your words) "a real patent", that would have been the system not working.
Sing it (Score:4, Funny)
Blackbird suing in the dead of night
Take these corrupt wings and go bye bye
All your life
You were only waiting for this moment to arise
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Because they just do not have
Even half a brain
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Can Cloudflare recoup legal costs from Blackbird? (Score:4, Interesting)
"the federal litigation process ... ran up considerable legal expenses"
This was the epitome of frivolous.
Re:Can Cloudflare recoup legal costs from Blackbir (Score:4, Insightful)
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Has a somewhat-legitimate-sounding applicant name/corporation.
Doesn't explicitly say "Free Energy" or "Perpetual Motion" in the title (sometimes I wonder if they even read the abstracts).
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Post abstract ideas to slash dot (Score:2)
If we search old slashdot postings, we should be able to find prior art for most of the troll patents. At least it will reduce their scope and reduce the potential targets for the blood sucker.
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If we post ideas to slashdot, would it become prior art?
Yes. If it's disclosed to the public, it's prior art.
It would, however, be prior art that the U.S. Patent Office would have zero chance of finding and citing: they do not search social media when they look for prior art
If we search old slashdot postings, we should be able to find prior art for most of the troll patents. At least it will reduce their scope and reduce the potential targets for the blood sucker.
Only if somebody finds the slashdot post and cites it in a lawsuit to invalidate the patent.
Just having the prior art exist is worth nothing; somebody has to dig it up, show specifically and clearly how it invalidates the patent (and do this claim by claim for every claim in the patent) and
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court found Blackbird's patent to be invalid (Score:3)
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Sounds like at least as much of an issue with the patent system as with the trolls.
Yes. The issue is that the patent examination system is underfunded.
Deal with it using fire (Score:1)
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You will get sued for violation of a patent covering "rapid oxidation of materials using exothermic chemical reactions".
So how many attorneys (Score:2)
This reminds me of the old song... (Score:2)