Ask HN: HELP Patent troll cruising my industry. What to do?

[tedjedbed]

Ok, this isn't my normal HN username, sorry.

Our startup provides web services/apps to a specific industry. Today I received news that one of our main competitors (although larger) just paid a multi-million dollar settlement to a patent troll.

I'm no attorney, but reading the abstract of the patent is scary–it's so broad that just about any tech company in our industry could be a target. They sued 2 even larger companies in the early 2000's (patent was filed in 2001, so it seems like they're going down the list of targets based on size.

We're profitable and growing well, but not to the point where we'd be "next on the list" ...

What should we do?

[shimon]

First, get a patent lawyer and try to judge how likely you are to be sued. An experienced attorney might be able to see a pattern in their behavior that you don't, and give you a better idea of what your risk is. Note that this risk is not purely a matter of facts -- you might well not be infringing or their patent might seem obviously over-broad. The real risk is the cost of a lawsuit and litigation, which is a combination of distraction and expense that can easily kill a small company.

Secondly, keep an eye on the patent troll's behavior and on the response from your competitors. If you are friendly with your competitors, see what info you can dig up about the patent trolls. See if you observe the trolls speeding up or slowing down. You might find that a "big" settlement wasn't as big as you might have guessed.

Thirdly, don't panic. There are patent trolls in every industry. I was sued by one once -- for a zero-revenue side project -- and it fizzled, but I worried a lot along the way. If they haven't tried to contact you yet, your time is probably better spent developing your business.

[kragen → shimon]

Oh, I'm glad to hear it fizzled!

[micks56]

You need a lawyer.

You have knowledge of an existing patent and knowledge that you appear to be infringing.

Again, you need a lawyer. Get an IP attorney.

[tedjedbed → micks56]

Can you (or anyone here) recommend a good IP attorney?

"and knowledge that you appear to be infringing"

This is what I'm trying to wrap my head around. What defines "infringing"? The patent abstract covers some features that we do, but also some that we don't.

How much overlap is required before it's considered infringement?

[micks56 → tedjedbed]

Where are you located? It is best to get an attorney near you. I am in Massachusetts.

Whether you are infringing depends on how the patent claims are drafted. That I cannot tell you because I can't give legal advice.

If you want to learn for yourself before going to a patent attorney, pick up a law school textbook and start reading. The law isn't hard. You just need to understand how the courts have interpreted the Patent Act.

I used this one in law school (used copy will be fine): http://www.amazon.com/Intellectual-Property-Trademark-Copyri...

Get the supplement, too (supplement gives you the recent updates to the law): http://www.amazon.com/Intellectual-Property-Materials-Supple...

[tedjedbed → micks56]

I'm in the Northwest

[olefoo → tedjedbed]

http://klarquist.com/home.aspx

They are in Portland, they are IP experts.

[micks56 → tedjedbed]

I don't know anyone out there.

Your best bet is to ask around at the Chamber of Commerce or other business meetups near you.

[trapper → tedjedbed]

IANAL but to my knowledge (multiple patents under my belt) if the patent covers A,B,C and you only implement A,B then you are fine. It depends how they have setup their claims though - some may be optional.

[codesink]

Moving your technology to a brand-new european company (no software patents yet) and licensing to your US company could avoid being sued by patent trolls? I don't know anything about such topics, just asking.

[ig1]

Get IP Insurance.

[tedjedbed → ig1]

I wonder if it would be hard to get in our case ... like getting health ins. with a pre-existing condition

[ig1 → ig1]

err why did someone downmod me for this ? - IP insurance is the standard way to protect yourself being sued in a patent lawsuit.

[opticksversi]

http://www.gardenweasel.com/News/AUGUST2006Newsletter.pdf [PDF]

In [Dean, of Segway fame] Kamen's opening statement he noted that some people might call him a "Patent Troll" since he now limits his activities to developing product ideas with the sole purpose of licensing them, but doesn't try to manufacture or market them. He believes that large companies are much better suited to manufacture and market products than to develop new products. He is better suited for developing these new products than manufacturing or marketing them.

He made a very strong point that the larger companies had most of the resources in his business dealings and didn't really need patent protection. On the other hand, his patent for his intellectual property was the only thing that he had on his side of the table. He concluded his opening remarks by saying, “ . . .the patent system was intended to help everybody to be able to participate in innovation."

[tedjedbed → opticksversi]

Sure, but I think there's a big difference between an innovative company actively designing and licensing technology–and a company being formed solely for the purpose of sitting on patents until they can sue a company for infringement.

Maybe I'm incorrect, but in the web 1.0 days, it seems patents were approved which are overly-broad ...

when you're simply conducting industry-specific business over the internet using standard technology and media, how does that pass the non-obvious test?

[jmackinn → tedjedbed]

Have you considered the idea of licensing the patent from them?

[opticksversi → jmackinn]

http://news.ycombinator.com/item?id=427621

[jmackinn → opticksversi]

Thanks. From reading those comments I should clarify my comment a bit more. I don't suggest they make any contact, I am just wondering if they have considered the idea of licensing. I think that broad sweeping software patents are a result of the patent system not truly understanding modern computers but I do think there is an important place for the patent system to protect developers of new technologies. Sometimes, I believe that the idea of licensing gets lost behind the abuse of software patents in general.

[vaksel]

You won't get trolled when you are small...and when you are a target, you'll be able to afford to pay them off.

But if you want to take a proactive approach, you can try contacting them, and asking them to let you license the stuff. It'll probably cost you some money, but probably not as much as you think.

[marcus → vaksel]

Don't ever contact them first!!! you'll be admitting that you are knowingly infringing on their patent, which will put you in an awful position if they decide to pursue litigation. consult a lawyer before you do anything, and have him/her review everything you write to them.

Sorry about the exclamation marks but this is a really dangerous suggestion.

[ankeshk → vaksel]

I don't think thats a good approach. If you contact them - you are starting a trail. You are letting everyone - especially them - know that you are infringing their patents. You are closing a big door for yourself for when they do end up suing you.

You don't want to approach them blind without knowing what kind of licensing agreements they've draw out for others. You don't want to be extorted.

Its best you start out getting a lawyer.