Clvr.Tv
Rss Feed
Linkedin button

Category: News


CLS v. Alice Oral Argument

Reading the transcript of the oral argument at the Supreme Court in this case is like listening to bunch of stoned college freshman debating Jonathan Livingston Seagull.  Not one person involved in the discussion would pass a first semester law school class in patent law.  None of the people involved are patent attorneys, none of them have a solid technical background, none of them understand how a computer works, none of them of legally or factually competent to be patent attorneys.  Everyone of the people involved in this oral argument should have recused themselves as incompetent

Alice’s attorney failed for three reasons: 1) he is not a patent attorney, 2) he tried to make sense of the Supreme Court’s earlier decisions, which a full of logical contradictions, 3) he failed to define what an invention is and what an abstract idea is.  CLS’s attorney was unscrupulous and played fast and loose with the law and the facts as I will explain below.

Because the oral argument was so incoherent, I will just highlight the parts that I found outrageous, interesting, or nonsensical.

Abstract Idea:  Justice Breyer is using the technique of all charlatans and refusing to define what an abstract idea is.  He should be thrown off the court for this stunt.  The abstract idea exception to 35 USC 101 is illogical.  Any truly abstract idea would not meet the requirements of 35 USC 112 and that is where this issue should be dealt with.  But Justice Breyer is not interested in logic, he likes using an undefined phrase that he can manipulate to attack any patent.

Justice Breyer’s use of analogies is against the law.  An invention is defined by its claims and the claims must be taken as a whole (35 USC 101 and Conservation of matter and energy).  The reason Breyer uses analogies is because he is too stupid to be able to understand the actual invention and is incapable of reading a claim.

Here is an example of this

I mean, imagine King Tut sitting in front of the pyramid

10 where all his gold is stored, and he has the habit of

11 giving chits away.  Good for the gold, which is given at

12 the end of the day.  And he hires a man with an abacus,

13 and when the abacus keeping track sees that he’s given

14 away more gold than he is in storage, he says, stop.

15 You see?

16  Or my mother, who used to look at my

17 checkbook, when she saw that, in fact, I had written

18 more checks than I had in the account, she would grab

19 it.  Stop.  You see?

20  So what is it here that’s less abstract that

21 the computer says, stop?

 

Using analogies to inventions is completely useless.  The law requires the invention be evaluated on the patent, not on some absurd analogy.  I warned Alice about this.  Alice’s council should have refused to deal in hypotheticals and pointed to the law.  They also should have defined what an invention is and what an abstract idea is.  An invention is a human creation that has an objective result.  Here Alice’s invention is a specially programmed computer.  Those do not exist separate from man.  Therefore Alice’s invention is a human creation.  Alice’s invention has an objective result of affecting a transaction if all the conditions are satisfied and not affecting a transaction if any of the conditions are not satisfied.

 

Here is an excellent analogy to the absurdity of Justice Breyer’s statements that using a computer to implement the invention is irrelevant, by my good friend and patent attorney Peter Meza, “A new idea for a current mirror does not become patent eligible merely by tacking on a transistor to carry it out.”

 

Another idiotic statement by Breyer when Alice’s counsel suggests Breyer’s analogy is caricature.

 

JUSTICE BREYER:  Of course it’s a

20 caricature.  It’s a caricature designed to suggest that

21 there is an abstract idea here.  It’s called solvency.

There is an abstract idea in every invention.  That is like saying the LASER is abstract because it uses the ‘abstract idea’ of stimulated emission.  Breyer is an idiot.  He uses analogies because he is totally incompetent in the technology, so he has to bring up something he does understand.

 

Justice Sotomeyer seems to be creating a new exceptions to 35 USC 101

 

JUSTICE SOTOMAYOR:  I’m sorry.  But ­­ but

20 what it appears to be, it sounds like you’re trying to

21 revive the patenting of a function.  You used the word

22 “function” earlier, and that’s all I’m seeing in this

23 patent is the function of reconciling accounts, the

24 function of making sure they’re paid on time.  But in

25 what particular way, other than saying do it through a

1 computer, is this something new and not function?

 

Was there ever a rule against patenting a function.  Patent law allows, actually requires that well known complex functions not be described in detail.  Thus we do not claim the transistors, resistors, capacitors in a low pass circuit or a transceiver.  Claiming a low pass filter is claiming a function: claiming a transceiver is claiming a function.  These Justices are idiots.  The function of error correction code is to correct errors.  A patent on an error correction code is a patent on the function of correcting error in the transmission of data.  The claims do not recite I claim intermediated settlement (whatever that is – note this is not a standard term used in banking)

 

Justice Scalia seems to be slowly learning some patent law.  Here he recognizes that this case in not about novelty.

 

JUSTICE SCALIA:  Well, I’m not saying use a

5 computer is ­­ is much of a novelty.  I mean, that’s ­­

6 that goes to whether it’s novel or not.  If you just say

7 use a computer, you haven’t invented anything.  But if

8 you come up with a serious program that ­­ that does it,

9 then, you know, that may be novel.  But that’s a novelty

10 issue, isn’t it.

 

Note the claims never say “use a computer” but these people are too ignorant to read claims.

 

Justice Kennedy shows he knows nothing about patent law.  Alice’s attorney should have force him to analyze the claims.  He should have said to Kennedy and Breyer the invention is defined by the claims, if you wish to discuss this invention then you must look at the claims and tell me what it is you are referring to.

 

 JUSTICE KENNEDY:  Suppose I thought ­­ and,

9 again, it’s just a thought because I don’t have the

10 expertise ­­ that any computer group of people sitting

11 around a coffee shop in Silicon Valley could do this

12 over a weekend.  Suppose I thought that.

 

Here both Alice’s attorney and Justice Sotomeyer, who is suppose to be a copyright attorney, prove their ignorance of a concept any law student taking copyrights should know the answer to – my only caveat to this is perhaps this was a backhanded way of saying Alice never wrote any code.  While CLS makes this claim, I seriously doubt it is true.

 

 JUSTICE SOTOMAYOR:  Is your software

15 copyrighted?

16  MR. PHILLIPS:  No, I don’t believe so.

 

Of course the software is copyrighted.  This is the incompetent leading the incompetent.

 

Alice’s counsel attempts to force Justice Kagan to look at the claims, but she proves her ignorance of patent law by ignoring the claim limitations.

 

 MR. PHILLIPS:  I’m saying both actually.  I

15 mean, I’m making both of those arguments.  I ­­ I

16 believe that if you analyze the claims and you don’t

17 caricature them and you don’t strip them out of the

18 limitations that are embedded in there, this is not some

19 kind of an abstract concept.  This is not some kind ­­

20 it’s not an abstract idea.  It’s a vary ­­

21  JUSTICE KAGAN:  So putting the computer

22 stuff aside completely ­­

 

Here Alice’s attorney attempts to get back on track.

So my suggestion to you would be follow that

15 same advice, a liberal interpretation of 101 and not a

16 caricature of the claims, analyze the claims as written,

17 and therefore say that the solution is 102 and 103 and

18 use the administrative process.  If you ­­

 

This might be a hopeful sign.  Justice Scalia is pointing out that not all the Justices agree on this interpretation of an abstract idea.

 

JUSTICE SCALIA:  And four is not five

10 anyway, right?

11  MR. PHILLIPS:  That’s true.

12  JUSTICE SCALIA:  Four is not five.

 

Another hopeful sign by Justice Scalia.

 

JUSTICE SCALIA:  By the way, we ­­ we have

16 said that you can’t take an abstract idea and then say

17 use a computer to implement it.  But we haven’t said

18 that you can’t take an abstract idea and then say here

19 is how you use a computer to implement it ­­

 

Justice Kagan proves she can’t read a claim or a specification and has no intention of doing so.

 

JUSTICE KAGAN:  Well, how are you saying the

5 how?  Because I thought that your computers ­­ that your

6 patents really did just say do this on a computer, as

7 opposed to saying anything substantive about how to do

8 it on a computer.

 

Justice Kagan proves she is incapable of reading claims or the patent statute

 

 JUSTICE KAGAN:  No, but exactly.  I mean,

22 the claim would have said something along the lines of,

23 you know, there’s this process by which people order

24 products and we want to do it over the Internet, we want

25 to do it electronically, and we will use a computer to

1 do that, to essentially take the process of mail order

2 catalogues and make it electronic.

 

 

Mr. Phillips lies to himself and the court about his ability to write claims.  Mr. Phillips is not a patent attorney and I am sure has never written a claim in his life.  He does not have the technical background to write claims and does not have the legal knowledge to do so.

 

 MR. PHILLIPS:  I could certainly ­­ I think

4 I could write a claim ­­ a set of claims that I believe

5 would satisfy 101.  And ­­ and to the extent that

6 you’d ­­ that you’d think those are no different than

7 the ones I have here, then my argument is simply I think

8 I satisfy 101 with the claims we have before us,

 

Here is blatant lie by Mr. Perry.

On the abstract idea, Justice Ginsburg, you

8 asked Mr. Phillips what’s the difference between hedging

9 and this claim. There is no difference.  This is

10 hedging.  It is hedging against credit default rather

11 than price fluctuation, but it is simply hedging.

 

The definition of hedge is “Making an investment to reduce the risk of adverse price movements in an asset.”  Nowhere in Alice’s claims is there any investment to reduce the risk of adverse price movements.  Mr. Perry should be disbarred.

 

 

Another blatant lie by Mr. Perry

This claim has simply two steps.  It’s very

18 simple.  “First, debiting and crediting on a realtime

19 basis the relevant shadow records; and second, by

20 periodically affecting corresponding payment

21 instructions.”

 

The patents involved are USPNs 5970479, 6912510, 7149720, and 7725375.  All of the claims require more than Mr. Perry’s lie.  He also shows he does not understand the difference between the claims and the specification. He should be disbarred.

 

 

Justice Roberts is on the right track but proves he is incompetent to rule on patent cases.

 

CHIEF JUSTICE ROBERTS:  Well, that’s a

25 little more complicated.  He referred us to Joint , which is not a change in how

2 computers work.  But it is ­­ constitutes the

3 instructions about how to use the computer and where it

4 needs to be affected.  And just looking at it, it looks

5 pretty complicated.  There are a lot of arrows and

6 they ­­ you know, different things that go ­­

 

 

Mr. Perry in the quote below has attempted to redact the whole specification.  Since Mr. Perry is not a patent attorney perhaps he doesn’t understand the claims have to be supported by the specification.

 

It’s 4 columns.

6 It’s less than five pages in the printed appendix that

7 actually pertains to this invention.  And it contains no

8 disclosure whatever.

 

 

Mr. Perry attempts to define what would be patentable.

 

MR. PERRY:  Your Honor, there are many

1 examples.  One would be a technological solution to a

2 business problem.

Mr. Perry isn’t this what Alice’s invention is?  Of course you are too ignorant to read the claims, so you wouldn’t know.

 

Justice Kennedy proves his ignorance of patents.  All inventions can be described as a method or an apparatus.

JUSTICE KENNEDY:  Well, I ­­ I ­­ in my

16 language, I’ve called that mechanical rather than

17 process.  Can you give me an example of process?

 

This admission by CLS should win the argument for Alice in a rational world – but this is not a rational world.

  MR. PERRY:  At a point in time in the past,

12 I think both of those (word processor/spreadsheet) would have been technological

13 advances that were patentable.

14  JUSTICE SOTOMAYOR:  How?

MR. PERRY:  Today ­­ because they would have

16 provided a technological solution to a then unmet

17 problem.

 

 

Mr. Perry is putting words in other people’s mouth that are clearly not true and demonstrating his lack of understanding of physics and inventions.  Every invention in the history of the world is a combination of known things/elements/steps because you can’t create something from nothing.  This is because of conservation of matter and energy.  In addition, section 112 requires that you explain your invention in language people understand, which means it has to describe the invention in terms of things that are known.

 And here we know that these patents don’t

1 claim anything that was not conventional, well

2 understood, and routine.  We went through that in great

3 detail, and Alice has never disputed a word of it.

“It is

10 possible to do the business methods of maintaining

11 accounts, adjusting accounts, and providing an

12 instruction without a computer or other hardware.”

 

It is possible to separate the seeds in cotton without a cotton gin, SO WHAT.

 

More stupidity from Mr. Perry.

We know from Benson, the Court’s seminal

20 computer implementation case, that if you can do it by

21 head and hand, then the computer doesn’t add anything

22 inventive within the meaning of the 101 exception.  That

23 is the holding of Benson.  And the Court reiterated that

24 in Mayo.

 

You can type by hand, you can do spreadsheets by hand.  Mr. Perry has just contradicted himself, but appears to be too technically incompetent to understand this.  Most likely so are most of the Justices.

 

Mr. Perry proves he does understand how claims of a patent work.  This is the sort of thing a first year associate in patent law should know.  Once again we have the incompetent leading the incompetent.  Alice’s invention cannot be implemented without a computer because of the need nearly real time communications.

 CHIEF JUSTICE ROBERTS:  What if ­­ what if

9 you can do it without a computer, but it’s going to

10 take, you know, 20 people a hundred years?  In other

11 words, theoretically, you can replicate what the

12 computer does ­­

13  MR. PERRY:  Two answers.

14  CHIEF JUSTICE ROBERTS:  ­­ but it’s

15 impractical without looking to do it on the computer?

16  MR. PERRY:  Mr. Chief Justice, first, these

17 claims literally read, as Alice reads them, on a single

18 transaction between two parties, so it’s not 20 people

19 for a hundred years.  It’s one person sitting in a room,

20 so that’s not a problem.

21  Second, if what is being claimed is the

22 necessary speed or efficiency or data crunching

23 capabilities, if you will, of a computer, then it would

24 have to be claimed, and there’s nothing claimed here.

25 All that is claimed ­­ and my friend is going to stand

 

No Mr. Perry the claims would never say any such thing.  But you are too incompetent to know that.

 

Mr. Perry proves he does not understand the purpose of 35 USC 112.  He is not a patent attorney.  Factually and Legally is not competent to be one.

MR. PERRY:  If I can answer in two steps,

20 Justice Kagan.  First in the negative:  What the

21 applicant or patentee must do ­­ must not do is simply

22 describe the desired result.  That would take us back to

23 State Street.  That would simply say:  I claim a magic

24 box that buys high and sells low or vice versa, I

25 suppose, I claim a magic box for investing.  That’s what

these patents do.

 

Listening to Mr. Perry is like listening to a teenage bull session.  Note that he makes a completely contradictory statement without even blushing.

MR. PERRY:  No, Your Honor.  I think the ­­

20 actual description of the programming is a 112 problem.

21 I agree with that, A 112 issue.  That is the realm of

22 the written description requirement.  What is a 101

23 problem is it is on the applicant to do more than simply

24 describe the results, simply say:  A magic box that does

25 intermediate settlement.

 

Justice Ginsburg clearly thinks she is a queen who can manipulate reality.  She is clearly too incompetent to even understand the contradictions and absurdities of her (the courts) own writings on patents.

 Justice Ginsburg, this Court’s precedents

3 are clear.  They are unanimous.  They just need to be

4 applied.  To suggest that there is confusion that needs

5 to be addressed by retreating, beating a retreat from

6 recent unanimous decisions, would simply reward

7 intransigence, difficulty, refusal to adhere to what are

8 clear precedents

 

 

Mr Verrilli proves he does not have the slightest idea how a computer works.  Any software is part of computing technology.  Patents are not about improvements, they are about whether the invention is novel (non-obvious).  Many designs around inventions are not improvements.  Mr. Verrilli should be fired for this clear ignorance of the law, but as a political appointee competence is irrelevant.

 GENERAL VERRILLI:  Mr. Chief Justice, and

17 may it please the Court:

18  An abstract idea does not become

19 patent­eligible merely by tacking on an instruction to

20 use a computer to carry it out.  A computer makes a

21 difference under Section 101 when it imposes a

22 meaningful limit on the patent claim.  That occurs when

23 the claim is directed at improvement in computing

24 technology or an innovation that uses computing

25 technology to improve other technological functions.

1 That’s the test that we believe is most faithful to this

2 Court’s precedents in Bilski and Mayo.

 

Mr. Verrilli is incompetent to read the claims of a patent, so he ignores them.

 

At least Justice Ginsburg is beginning to understand that ‘abstract idea’ has never been defined.  Clearly Alice’s invention is a concrete invention, it solves a real problem using technology.  Clearly, the Obama Administration is doing the bidding of Wall Street and trying to ensure that there are no patents having anything to do with finance.  But neither the Obama Administration nor Wall Street can provide a rational explanation for this, so they resort to argument of “tradition.”

 JUSTICE GINSBURG:  I have a question about

3 how do you identify an abstract concept.  The ­­ a

4 natural phenomenon, a mathematical formula, those are

5 easy to identify, but there has been some confusion on

6 what qualifies as an abstract concept.

7  GENERAL VERRILLI:  We would define

8 abstract ­­ an abstract concept as a claim that is not

9 directed to a concrete innovation in technology,

10 science, or the industrial arts.  So it’s the ­­ it’s

11 abstract in the sense that it is not a concrete

12 innovation in the traditional realm of patent law.

 

Justice Sotomayor proves that she cannot understand basic logic.  If there are no business patents, then there are no patents.  All patents are directed to a business, people are not getting patents so they can hang a plaque on their wall.

 JUSTICE SOTOMAYOR:  If we were to say that

19 there are no business patents ­­

 

Patent law has now devolved to the state of politics.  As this oral argument proves, there is no logic, the statute is ignored, the claims are not analyzed, the only real question is who has the most political pull.  Patent law has become a cesspool in the same vein as anti-trust law, environmental law, and the Obama Administrations belief that they can change statutory law by Executive Orders.

 

 
Adam Carolla and the Podcast Patents: The Real Story

Adam Carolla is being sued by Personal Audio LLC and has created a FundAnything (crowdfunding site) campaign to raise money for his legal defense.  He is billing this dispute as a patent that will kill off podcasting.  This is the sort hyperbole people who don’t want to pay inventors engage in.  Note Mr. Carolla wants to be paid for his intellectual property.  Since Mr. Carolla is making the standard arguments against inventors who attempt to enforce their property rights, I will examine some of the arguments below.

1.  The inventor will not receive any of the profit from this lawsuit, only a shell company, whose only purpose is to sue people.

One of the inventors on the patent is a serial entrepreneur and is an owner of Personal Audio LLC who is suing Adam Carolla.  James Logan founded MicroTouch Systems in the 80s and served on the on the Board of Directors of Andover.net, the company that acquired Slashdot back in 1999.  He founded, Personal Audio, in 1996.  The original company was Personal Audio Inc. and the patents are now owned by Personal Audio, LLC.  Personal Audio invested $1.6 million developing this technology.  As Mr. Logan points out, when inventors are paid for their inventions it reduces the risk of investing in new technologies.  This increases the willingness of investors to put money into inventions, which results in more advances in technology.  In addition, Mr. Logan explained that he and the company want to see podcasting thrive, because that will maximize their profit.  Killing off podcasting is not the goal of or in the interest of Personal Audio.  Mr. Carolla statements to the contrary are just nonsense.

 

Conclusion: Adam Carolla is spewing BS.

 

 

2.  The inventor never made anything.

As the inventor, James Logan, points out Tesla never made anything either.  Most of Edison’s inventions were sold to companies and he produced nothing, the same can be said of Bell and many of the great inventors of the US.  Mr. Logan points out that many inventors have no interest in manufacturing, marketing, distribution etc.  But today’s system forces inventors to work for a company.  You would think someone in the media would have read Adam Smith and understand division of labor.

In the late 1800s it was quite common for people to specialize in inventing and over 85% of those inventors who obtained a patent eventually sold or licensed it to a manufacturer.  Today the attack on inventors mean that even when inventors have a valid, issued patent that has been upheld in court (Personal Audio v. Apple), people like Mr. Carolla, argue they have the right to steal other people’s inventions.

Note that Mr. Carolla never makes anything.  He sells his comedy, which is just a bunch of words, until a recording device and a transmission device turns that into a product.  Perhaps actors and comedians should not be paid either.

Imagine if actors and authors could not sell their creations without first having a company turn them into a book, movie, or recording?  That is exactly what Mr. Carolla is advocating.

 

Conclusion: Adam Carolla is spewing BS.

 

 

3.  The invention was created by other people independently.

This is a common argument by people who don’t want to pay inventors.  The patent in question was applied for in 1996 and the Patent Office divided the original patent application into three or more patents.  The first patent issued in 2001, so the world has known about this technology for a long time.  This makes the claim of independent invention absurd.  But on top of that according to Mr. Logan these patents have been cited in over 1300 other patents.  Clearly the world was aware of his technology.  The idea of independent invention without knowledge of Personal Audio’s invention is absurd.   The US had a system for disputes between nearly simultaneous inventions until the passage of the American Invents not Act in 2011 and this process was rarely invoked.  The infrequency of this process was a major argument for changing our laws from a first to invent to a first to file.  Independent invention is a diversionary argument, to distract from the fact that people like Carolla want to steal other people’s work.

 

Conclusion: Adam Carolla is spewing BS.

 

 

4.  The patent is not valid and is overly broad.

This is a favorite of the leaches who do not want to pay inventors.  This patent was applied for in 1996.  No one had thought about podcasts at that time.  Few were thinking about sending large files or streaming files.  A high speed modem at the time was 64Kbaud and compression techniques were much more limited.  This invention was ahead of its time so it is very unlikely that there is prior art to invalidate this patent.  As a result of the invention being ahead of its time, it can validly ask for and receive fairly broad claims.  However, the claims do not cover all podcasts, as the hyperbole of Mr. Carolla and other suggest, they are directed to playlists.

Personal Audio LLC sued Apple over these same patents and won.  Apple already raised these issues in court and lost.  It is complete nonsense to suggest that these patents are overly broad and should never have been issued, without providing specific evidence that was not raised by Apple.  Clearly, Mr. Carolla has no respect for the law and more importantly no respect for inventors.

 

Conclusion: Adam Carolla is spewing BS.

 

 

5.  The Patent was applied for on March 4, 2009 and granted on February 7, 2012

This comes from TechDirt which has no compunction about lying about patents.  The patent was filed for in 1996.  TechDirt then argues that the Patent Office is allowing patents too fast.  Imagine if you built a house, bought a stock, or a car and it took three years to obtain title to it.  You would think you were living in a third world country, which is exactly what is happening to inventors.

 

 

 

Mr. Carolla is a hypocrite who thinks artists should be paid for their work, but not INVENTORS.  I bet if I start selling copies of Mr. Carolla’s performances he would sue me in a nanosecond.  He would talk about how I was stealing his work, but inventors are supposed to work for nothing.  Note all the above arguments apply to actors/comedians as well as inventors.

 
CLS Reply Brief:  Alice v. CLS Bank Supreme Court

CLS’s Reply Brief is not only illogical it is filled with intellectually dishonest statements.  The lack of logic is not surprising given the Supreme Court’s confused and disorganized thinking on the subject, but the intellectual dishonesty is inexcusable.  Despite this a careful reading of CLS’s brief shows that their argument fails on its face.  If you don’t have a winning argument, confuse and overwhelm them.

CLS’s arguments boil down to Alice’s patent claims preempt the idea of an escrow account and they are a non-practicing entity to boot.

The claims asserted by Alice recite the fundamental economic practice of intermediated settlement or escrow, in which a “middleman” stands between the counterparties to a transaction and effectuates the transfer of entitlement once all conditions are satisfied.

There are so many problems in this statement it is hard to know where to begin.  First of all ESCROW has a definition: it is money, property, a deed, or a bond put into the custody of a third party for delivery to a grantee only after the fulfillment of the conditions specified.  The claims do not cover this situation.  The term ‘intermediated settlement’ does not have a well defined meaning.  You cannot find a definition for this term in the online finance dictionary.  So it clearly is not a fundamental economic concept.  CLS is using the charlatan technique of purposely blurring the definition of words.

Then CLS makes this statement:

Allowing patent claims like these would effectively foreclose the productive use of economic concepts and other fundamental principles in our increasingly computerized Information Age, in contravention of the Constitution and the Patent Act.

The claims are clear and if CLS wants to computerize an escrow arrangement it can do so.  This is just a lie that Alice’s patent preempts a fundamental principle and the lawyers who wrote this should be sanctioned for lying to the court.  Second the purpose of the Constitution is to protect the rights of Inventors.  No patent forecloses the productive use of any invention.  This is an attempt to confuse patent law property rights with anti-trust law.  Property rights provide for the owner the right to exclude others from using their property.  Ownership of a building or an invention does not foreclose economically productive uses of the property.

Here is another dishonest statement in CLS’s brief.

The economic concept of intermediated settlement is an abstract idea under the approach taken in Bilski and subsequently endorsed by the PTO.

Note the intellectual slight of hand here.  Alice did not claim the concept of an intermediated settlement.  Instead of dealing with the claims, CLS attempts to provide a broad generalization of the claims and then analyze the abstraction.  This is against the law and fundamentally dishonest.  The court must deal with the claims, not CLS’s self serving broad categorization of the claims.

 

Property Rights, Patents, and Monopolies

CLS and some judges are suggesting the blatantly false statement that patents are monopolies.  Patents are property rights.  Property rights are the result of creation, see John Locke.  This was recognized in common law and can be found in Sir William Blackstone’s Commentaries on the Laws of England.  For more information see Patents are Natural Rights http://hallingblog.com/patents-are-natural-rights/.

Antitrust law is never applied to a property right.  It only can be invoked based on how property rights are used.  Enforcement of one’s property rights in court cannot be consider a violation of antitrust law.  This whole line of reasoning is straight out of a Marxist text and should not be tolerated.  But on top of it Alice’s patents do not give it property rights in electronic escrow accounts.

 

Definitions

I have often stated that using loose definition is the handmaiden of charlatans and tyrants and CLS seems to be quite good at it.

Laws of nature, natural phenomena, and abstract ideas are not patent-eligible under this Court’s established construction of 35 U.S.C. § 101. The asserted claims of Alice’s patents are ineligible under that standard because they attempt to monopolize the abstract idea of intermediated settlement.

First of all property rights do not monopolize anything.  This line of reasoning by CLS is straight from Marxist dogma.  CLS and the courts have thrown around the phrase abstract idea but failed to define it.  Perhaps Thomas or Scalia will demand a definition.

Let’s examine what a reasonable definition of an abstract idea would be.  Some of the potential definitions of “Abstract” from Dictionary.com are provided below:

1. Considered apart from concrete existence: an abstract concept.

2. Not applied or practical; theoretical. See Synonyms at theoretical.

3. Difficult to understand; abstruse: abstract philosophical problems.

4. Thought of or stated without reference to a specific instance: abstract words like truth and justice.

5. Impersonal, as in attitude or views.

6. Having an intellectual and affective artistic content that depends solely on intrinsic form rather than on narrative content or pictorial representation: abstract painting and sculpture.

Clearly the first or second definitions appear to be the closest to what the Supreme Court means when speaking of patents.

Now here are some of the definitions of “idea” from the same source.

1. Something, such as a thought or conception, that potentially or actually exists in the mind as a product of mental activity.

2. An opinion, conviction, or principle: has some strange political ideas.

3. A plan, scheme, or method.

4. The gist of a specific situation; significance: The idea is to finish the project under budget.

5. A notion; a fancy.

The first definition appears to be the most appropriate.  So what we end up with is a thought or conception that is separate from concrete existence or not applied to the practical.  In the broadest sense of the word, every patent defines an invention that has been abstracted.  An invention by definition is an abstraction or a category of things.  If this is what the judges mean, then the standard is complete nonsense, since it negates every patent.

If we use the definition of an Abstract Idea given above “a thought or conception that is separate from concrete existence or not applied to the practical”, then every invention that meets the requirements of 35 USC 112 first paragraph is not an Abstract Idea, since this section requires that the invention be described in a manner so one skilled in the art can practice the invention.  Something that can be built and used (practiced) is concrete and applied, therefore it is not an abstract idea.  The ABSTRACT IDEA exclusion to 35 USC 101 should be dropped, because any logical definition of an abstract idea is excluded by 35 USC 112, first paragraph.  It should also be dropped, because, Judges should not read into statutes things that are not there.

A computer is not an abstract idea, it uses electrical power, generates heat, causes electrons to move.  Those are all real world effects.

 

Another poorly defined term is used by CLS in this statement.

The claims asserted by Alice do not include “significantly more” than the abstract idea of intermediated settlement, such that they could be patent eligible under Mayo Collaborative Services v. Prometheus Laboratories, Inc., 132 S. Ct. 1289 (2012). Alice fails to come to grips with the analytical approach this Court articulated in Mayo, which requires an “inventive concept.”

First of all the patent statutes do not discuss an inventive concept.  Second of all, the phrase ‘inventive concept’ is not defined in the brief, statute, regulations, or by the Supreme Court or any other US court.  Courts do not have the right to reinvent statutes.  The requirements for a patent are clear and substituting another term for what the statute says is illegal and should cause any judge to be impeached for subverting the Constitution.

 

Another poorly defined term used to smear patents by CLS.

Petitioner Alice Corporation Pty., Ltd. Contends that the CLS system infringes “business method” patents that broadly claim a computerized form of intermediated settlement.

Every patent is part of a business and any method patent is therefore broadly speaking a business method patent.  The first patent issued in the US was a method of making potash.  Since making potash is/was a business the very first patent issued in the US was a business method patent.  The people who argue against business method patents have failed to provide a consistent, clear definition of what they mean.

 

Bilski

CLS tries to paint Alice’s claims as being the same as Bilski.  This is nonsense.  Bilski admitted that their claims did not require a computer.  Alice’s claims specifically require computers and a communication network.

Note that a series of steps performed by hand can definitely be an invention.  The first patent issued in the US was for a method of making potash and all the steps were performed by hand.

 

Other Points Nonsensical Points in CLS Reply Brief

Alice suggests that its claims do not meet its chosen dictionary’s definition of escrow because they “do not prescribe that the electronic intermediary (or any other third party) receives any money or property.” Pet. Br. 47 (emphasis added). Of course, Alice’s claims do not preclude the receipt of money or property and thus would cover such activity. In any event, nothing in the concept of intermediated settlement requires the physical exchange of money or tangible property.

This shows a lack of understanding of patent law.  Either these lawyers should be fired as incompetent or they should sanctioned for lying to the court.  No patent claim precludes the use of something outside of the claim.  Alice’s claims do not cover the use of an electronic escrow.  Claims don’t preclude things, they define what is covered by the claim.  If my patent claim on a bicycle includes a shock absorber in the fork, it does not preclude having a solid fork.  It also means you can build a bicycle with a solid fork.  Here CLS is admitting that Alice’s claims do not preempt an escrow arrangement.  But like all charlatans they state it in such a convoluted way that it is hard to untangle the mess to see what it really means.

 

CLS quotes two Mark Lemley papers.  Mr. Lemley is not a patent attorney, has never written a patent claim in his life, is not legally or factually competent to practice patent law.  Mr. Lemley is a charlatan who spouts off recycled Marxist ideology applied to patents.

 
Win a FREE Copy of Pendulum of Justice

Win a free copy of the thriller Pendulum of Justice.  Click HERE to enter the Goodreads giveaway.

 

Back Cover

All that is necessary for the triumph of evil is that good men do nothing.

 

With two high tech start-ups going gangbusters, former cyber warrior Hank Rangar has finally “made” it. His lab, “Made By Man,” has revolutionized cardiac procedures, potentially saving millions of lives and billions of dollars.  But, the most important person in his life is very sick and his technology is suddenly stolen.  Hank discovers two things: This lifesaving procedure may be the only way to save his sister AND Big Washington will stop at nothing to bury it.

 

 

Praise for Pendulum of Justice

Pendulum of Justice reads like a book on anti-gravity: impossible to put down!  My main complaint is how come the next book in the series isn’t out already.”

Peter Cresswell, Publisher of NotPC

 

Convert this to a movie script and sell it to Hollywood. Excellent theme and plot. 

The Magnolia Blossom

 

WOW! I feel like I just watched a movie in my head

Hines and Bigham’s Literary Tryst

 

Absolutely brilliant – that was my first thought after I finished reading this compelling novel. 

Lit Amri for Readers’ Favorite

 

 

 
Are Patents too Vague?

Adam Mossoff takes on the common claim that patent are too vague in his paper THE TRESPASS FALLACY IN PATENT LAW, by Adam Mossoff, 65 Fla. L. Rev. 1687.  The argument is often framed as patents are not like real property where you know if you are trespassing another person’s property.  This analogy is flawed, he points out, because property rights in land are not limited physical trespass.  Property rights include time (future interest), use, and physical boundaries.  The proper analogy would be with the estate or all the property rights associated with land.  Then he points out that critics of patents actually have no empirical data on litigation involving all aspects of ‘real property’.  He also points out that real property disputes often turn on the meaning of arcane terms and arise because legal drafting in not an exact science or math.

I would add that most of the commentators on patents are not legally or factually competent in reading claims.  In addition, neither are most judges.  (See Is the Supreme Court Competent to Rule on Patent Cases?)    This is not because patents are vague or purposely obscure or overly formalistic.  Drafting claims is a skill that takes several years to become proficient with.  The same is true of being able to interpret a paper on electromagnetics or quantum mechanics and these are very precise sciences.

Most of the people complaining that patents are too vague are not interested in the truth, logic, or reason.  They want to destroy all property rights or they are crony capitalists that want a patent system that favors them, particularly against individual inventors and startups.

 

THE TRESPASS FALLACY IN PATENT LAW, by Adam Mossoff, 65 Fla. L. Rev. 1687

 
Halling asked to Speak at Atlas Summit 2014

Dale B. Halling, author of Pendulum of Justice  (with his wife Kaila) and The Decline and Fall of the American Entrepreneur, has been asked to speak at the Atlas Summit 2014.  The topic of his talk will be “Why did Rand Choose Inventor as Galt’s Profession?”

Abstract

Why did John Galt say “I was an inventor.  I was one of a profession that came last in human history and will be first to vanish on the way back to the sub-human?”  Today, there is an all-out attack on inventors.  Effective property rights for inventors are relatively new, dating from the beginning of the Industrial Revolution.  Currently, patent rights are under assault from all ends of the political spectrum and almost everywhere around the world.  Was Rand wrong when she said, “Patents … are the legal implementation of the base of all property rights.”

 

The goal of this book is to define the process of how technology is created and evolves.  The author, Arthur W.. Brian, is an economist with an electrical engineering background.  The book tackles a very important subject that has barely been scratched.  Technology, as the author points out, defines are standard of living.  Increasing one’s level of technology is the only way to increase real per capita income.  Most books about technology and “innovation” are poorly written, poorly thought out, and meant to sell the author as a mystical guru of innovation.  George Gilder being one of the exceptions, but even his writing on the subject is meanders and tied to specific technology trends.

The book starts by defining a technology as a unique combination of elements and the author repeatedly points out that every technology is built on existing elements (technologies) and scientific phenomena.  If the author had just used this as his definition of an invention, he could have taught the Supreme Court a lot about patent law.  He also explains that a new system technology (jet engines instead of prop engines) require new component technologies.  He has a several interesting historical examples of this.  I have often used this knowledge to tell inventors/companies how to expand their patent portfolio.

The author could have saved himself a lot of trouble by talking to a competent patent attorney.  For instance, the author discovers that every technology can be described as a system or a method.  If he had just talked to a patent attorney they would have pointed him Landis on the Mechanics of Claim Drafting where this is explained.

The books explanation that both technology and biological entities are built hierarchically and higher levels of technology cannot be created until the building blocks are in place is very important.  His computer “experiment” about the development of logic circuits was very interesting.  The authors explanation that neither technology nor the economy is ever in equilibrium is a point that cannot made too often.  The idea of a static economy (biology) leads to all sorts of economic nonsense – see minimum wage and government mandates for alternative energy.

I think the author’s definition of economy is a step in the right direction.  He states economy is “the set of arrangements and activities by which a society satisfies it needs” and economics is the study of this.  This is such a good step in the right direction, but “society” should be changed to “human beings.”  This may sound like a small difference but it makes clear that economics applies even in small groups, even for an individual living on a deserted island.  This is important because it eliminates the nonsense that what makes no sense in isolation makes sense with a large group of people.  Also society does not have needs, people do.  This change avoids the Orwellian implications of defining economics in terms of society.

The author’s definition of invention and standard engineering needs to be rethought.  Standard engineering is the creation of a specific instance of an invention to fit a particular need.  For instance, standard engineering involves modifying a high pass operational amplifier to work for a specific frequency or modifying it to handle a higher power signal, or modifying a bike so it is designed for children.  The engineer is not creating a new class of objects he is modifying an existing technology (invention) to meet a particular need.

While the book is highly repetitive and ignores the store of knowledge from patent law it is well worth reading.

 

 
Guest Post: Stop the Destruction of Independent Invention

This is an open Letter by Randy Landreneau

Hello Friends,

The fight to stop multinational corporations from destroying the Patent System our Founders so intelligently created is coming to a head.  The Senate is expected to do something before the end of the month. I and some other inventors are going to Washington DC next week to meet with our Senators, and to do what we can to stop the further destruction of the American Patent System. We want as many inventors as possible to join us.

For any of you who aren’t up to speed, here’s the short version. Our Founders created the American Patent System much differently than patent systems in the rest of the world. The intent was that an individual from any walk of life would be able to own and benefit from that which he or she created. Since most innovation, and especially game-changing innovation, comes from individuals, not large corporations, the result of the American Patent System has been much more innovation from America than the rest of the world, and much greater economic success.

Effective innovation has been the reason for the economic success of America, but it is a threat to the vested interest. Large corporations would rather not have to worry about new products to compete with, and they would rather not have to deal with patent infringement lawsuits when they choose to act badly. The result has been serious efforts to change the American Patent System to something that is quite different than what was originally intended.

What is playing out right now is a very well-constructed campaign using misleading propaganda that has our politicians very close to destroying the American Patent System (as it relates to independent invention). The US House passed the Innovation Act faster than anyone thought possible. The Senate appears is trying to do the same. The only way to stop it is to get our Senators to see the truth.

The truth is that “Loser Pays” will make it virtually impossible for the typical independent inventor to defend a patent. Allowing “serial challenges” to issued patents will allow large corporations to bankrupt independent inventors and thereby eliminate competition. “Enhanced pleadings” and “limiting discovery” are further efforts to put patent holders at a disadvantage (see attached document). Everything in this legislation works against independent invention.

If there is any way you can come to Washington DC next week, please do it. I will be there Tuesday, January 22nd, but Paul Morinville will be there the 21st through the 23rd, and possibly the 24th also. We will work together, and go as a group to each other’s meetings where possible. We will inform you and support you in this effort. I am confident that we can make a difference. Please join us and help make sure independent inventors will not be shut out of America’s future.

If you can’t go, definitely continue to email and leave voice mails for your senators. This is easy – just go online, find them, go to their websites, hit “contact,” etc. Whether we win or lose this fight depends on what we do right now. Please help us win this battle.

 

 
DK Halling Interview with Fran Lewis

The authors of Pendulum of Justice, Dale and Kaila Halling, will be on the Fran Lewis show on Thursday, January 16 at 3:45pm (EST) discussing their book, writing, and more with several other authors.

 
Latest Review of Pendulum of Justice

The Magnolia Blossom one of the premier review sites for independent authors just reviewed our book Pendulum of Justice and gave it 10 out of 10.  Here is what they had to say:

Convert this to a movie script and sell it to Hollywood. Excellent theme and plot. Big business and big government, intrigue, power-plays, coverups, tragic consequences and revenge of the “little guy”.

Let me put it this way: I read the first couple of chapters the night before, picked it back up the next morning and didn’t put it down that day until I was done. This definitely classifies as a “page-turner”.

Read the full review here.

 
Guest Post: Fatal Patent Legislation Must Be Stopped

We are facing is the worst attack upon independent invention that we have ever faced. The changes from the America Invents Act pale in comparison. Having to be more secretive and file Provisional Patent Applications earlier can be dealt with, but having no possible way to defend a patent against a financially strong infringer is a fatal blow.

Many inventors have thought that bringing a patent infringement suit is financially beyond them. But this is America, and you can hire an attorney on contingency. Your patent and your case have to be strong, but it can be done. This isn’t some myth – I have a friend who did this and won. But the legislation that passed the House, H.R. 3309, has Loser Pays,  meaning that the patent holder has to pay the legal expenses of the infringer if the case isn’t won. There is some language in the bill that gives some leeway so that possibly not every inventor will have to pay the legal expenses of the infringer in every single failed case. But the inventor will have to go into the case with the risk and be subject to the whims of judges who can be biased, misinformed, wrong-headed, and maybe even influenced. Most of us would not be able to take on a financial risk that would be at least hundreds of thousands of dollars, if not much more. Loser Pays creates a situation where the typical independent inventor who is not wealthy will not be able to defend a patent.

I wish that were all. You know how the America Invents Act put into place some new ways to challenge an issued patent? Of course, that is bad for us. But at least the challenger had to bring his best case and could not later come forward with new arguments and additional challenges. This is referred to as serial patent challenges, which would very quickly deplete the typical inventors funds and ability to defend his patent. The passed bill, H.R. 3309 does away with the estoppel provision, and will allow serial patent challenges. The typical inventor will not be able to continue to defend a patent if an infringer employs serial patent challenges.

There’s more, but there is nothing in this bill that is good for the independent inventor. The stated purpose is to handle Patent Trolls (non-practicing entities [NPEs] who allegedly buy up patents and frivolously sue patent holders). There’s a lot of discussion on whether or not the troll issue is even a real issue rather than just large companies not wanting to be sued for actual patent infringement. I and a lot of others believe it is the latter. I believe that the average Senator just isn’t aware of how this legislation will affect independent inventors because they are only hearing the large corporation argument.

We cannot let our rights as inventors be stripped away, as they surely will if we don’t start making a lot of noise. It is possible that the Senate will just vote on the House bill as is and be done with it. I have heard that they will be meeting on it this week. In an effort to look like they are doing something, they could pass it this week!

If you are expecting others to make this go right, don’t. I know there are people fighting on our side, but there were with the America Invents Act as well. There, we were beaten 85 to 10 in the final vote. The only thing that will stop this tragedy, and it is a tragedy, is if you get this email out far and wide and call your Senators and tell them you are against what was passed in the Innovation Act, H.R. 3309, and whatever the Senate is may be adding without the input of any independent inventors. Tell them that independent inventors are the backbone of American innovation, and that they must vote NO to this and any future efforts to weaken the American Patent System. Tell them that the proposed changes are the exact opposite of what made America the greatest innovator and greatest economic power in the world. The proposed changes create the opposite of what was intended by the creation of the American Patent System. Call now. Thank you for your help.

 

There is a myth that Non-Practicing Entities (mythical creators who live under bridges) have caused an explosion in patent litigation.  A recent report from the Government Accounting Office has concluded: 1) current concerns expressed about patent licensing companies were misplaced, and 2) no such NPE litigation problem exists.  Yet Congress is pushing forward with the so called “Innovation Act.”  For more information see GAO Report on Patent Litigation Confirms No “Patent Troll” Litigation Problem.

 
Echoes of Pendulum of Justice: Government Stealing Inventions

An article by Eric Shawn on Fox News discusses how the government is stealing the inventions of private citizens.  In our Novel, Pendulum of Justice, the main character’s invention is stolen by the government resulting not only in the death of his company but the deaths of thousands of people.  These are the real world affects of our government not protecting the property rights of inventors.  Congress is set to further weaken the property rights of inventors with the so called Innovation Act, HR 3309.  This act is designed to allow large corporations and the government to steal the inventions of startups and individual inventors.  We did not know about these specific examples of the government stealing inventions when we wrote the book, but we did know this is the logical consequence of the policies being pursued in the U.S.

 

 

“Whenever the legislators endeavor to take away and destroy the property of the people, or to reduce them to slavery under arbitrary power, they put themselves into a state of war with the people.”

                                                                                                                                 —John Locke

 
Gary Boone Inventor of the Microcontroller Dies at 68

Gary Boone invented the microcontroller while working at Texas Instrument in the early 1970s.  I had the good fortune to know Gary Boone in the later part of his life, he had a brilliant mind and was a good friend.  It is sad day for the electronics industry and my heart goes out to his family.

IEEE did an Oral History with Gary that was lost for over a decade. You can see the agility and brilliance of this great inventor’s mind in the interview.  Please read the whole oral history.  Mr. Boone has a number of interesting insights in the interview.  For instance, he states that he invented microcontroller while at Texas Instruments because of boredom.  He was working in a group designing custom Integrated Circuits (ICs).  While designing these chips he began to feel “I’m tired of doing this.  I’m working long hours.  My family is not happy.  I have to find a better way of doing this.”  He also noticed that the basic requirements for all these projects were similar and this led to the idea that a general chip that was programmable could solve multiple customers’ requirements.  He also discusses the resistance in the community to this innovation.

After inventing the microcontroller, he moved to a start-up company, Litronix, that made handheld calculators.  The company was not aggressive about filing patents.  An overseas competitor was able to drive Litronix out of the market because of the differential tax rates, U.S. regulatory rules on consumer warranties, and their weak patent portfolio.

Because Mr. Boone was the inventor of the microcontroller, he ended being involved in numerous patent lawsuits.  This has caused him to have a unique perspective on the patent system.  One of the most interesting points he makes is that design teams often fail to review the patent literature before starting the design process.  Because of this, they often reinvent designs and reviewing patent literature results in better designs.

Gary will be missed by all that knew him.

 
Pendulum of Justice Now Available on Nook: Barnes and Noble

Pendulum of Justice, the first in the Hank Rangar series of novels, is now available on Barnes & NobleReader’ Favorite gave Pendulum of Justice five out five star, here is what they had to say:

Reviewed by Lit Amri for Readers’ Favorite

Hank Rangar, former cyber warrior, has revolutionized cardiac surgeries, and is able to save millions of lives and medical expenses with his lab Made By Man. Unfortunately, his technology is stolen and his gravely ill sister desperately needs this crucial lifesaving procedure. Hank has to face a corrupt Washington bureaucracy – will he succeed? Pendulum of Justice is the first installment in the Hank Rangar Thriller series by husband and wife, authors Kaila and Dale Halling, aka D.K. Halling.

Absolutely brilliant – that was my first thought after I finished reading this compelling novel. Pendulum of Justice is a fascinating political thriller that grabbed my attention right from the get go. I want to have the intelligence, ethics, and bravery of Hank Rangar. I really admire this well-developed protagonist, who is a high-tech expert with a history as a skilled combatant in the government’s computer warfare efforts. Corruption is an essence of the story’s premise that is familiar to all of us, so that we will instantly relate to Hank and the problems that he faces. His pain, frustration, and triumphs are also ours, against powerful people who let greed take over their ethical sense.

Kaila and Dale Halling are able to harmoniously create a deft prose in this engrossing tale about one man’s justice against a broken system. The message of this novel is bold, reminding us about the prejudice of government’s regulations regarding the merit of innovations. Overall, this is a commendable novel and an excellent debut for a great series.

Pendulum of Justice has twenty five reader reviews on Amazon, with 22 out 25 being five out five stars and three being four out of five stars.

Check out Pendulum of Justice at Barnes & Noble.

 

Subscriber Count

    16

Advertise Here

Your Ad

could be right

HERE

find out how

Donations

Coming Soon