This client alert explains some recent changes in US patent law (see also Cease & Desist Letters –> Declaratory Judgment Lawsuits). Under previous law, if a patentee threatens to sue you with patent infringement, you had a “reasonable apprehension” of being sued, so instead of waiting around for years for this to happen, you could institute a “declaratory judgment” (DJ) suit yourself, to have the issue resolved. But the patentee had to have a “reasonabl apprenhension” of facing an infringement suit to justify a DJ. This generally meant that a company that took out a license from a patentee could no longer file a DJ once a license agreement was reached. It also meant that if a patentee merely approached a potential infringer for licensing negotiations, e.g. by notifying them of a given patent and inviting licensing discussions, while avoiding making it a “cease and desist” letter, then you didn’t give the competitor “reasonable apprehension of immediate suit.†So approaching someone to take a license out on your patent didn’t permit the recipient to file a DJ action–even though the premise behind all such negotiations is the implicit threat that if you don’t take out a license, we might sue you.
Recently the Supreme Court and the Court of Appeals for the Federal Circuit, following the Supreme Court, changed the standard for filing the DJ action by abandoning the “reasonable apprehension” requirement. This makes it easier to file DJ actions when one is worried about infringing someone’s patent. The CAFC said:
where a patentee asserts rights under a patent based on certain identified ongoing or planned activity of another party, and where that party contends that it has the right to engage in the accused activity without license, an Article III case or controversy will arise and the party need not risk a suit for infringement by engaging in the identified activity before seeking a declaration of its legal rights.
Now, what I found noteworthy about this case was this lawyers’ analysis in the client alert noted above: “Another menas that may be necesssary in order to avoid the chilling effect that SanDisk might have on patent licensing is for Congress to…” This is kind of amusing: a “chilling effect” usually refers to the effect some laws have on individuals exercising their free speech. Yet here, these lawyers use it in the context of what are basically threats of extortion. When a patent holder sends a letter to someone and invites discussions as to taking out a license, this is an implicit threat to sue unless money is paid. This is commonly called extortion, but it is made legal by the patent statute. In any event, if the making of extortionate demands like this gives the victim the right to file a declaratory judgment in court to defend himself, it’s hard to see how this exerts any meaningful “chilling effect”.
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I guess this particular lawyer more often represents the extortioners.
It levels the playing field by making the letter writer think real hard about potential costs if letter recipient decides to fight back rather than write a check. That is why this is so dangerous and chilling. A level playing field is abhorrent to the entire IP structure; it is, in effect, a direct challenge to the very core of IP, namely the idea that monkey scribes writing for other monkey scribes can siphon-off unearned income from the productive. Shocking. Perhaps Congress will drop its vital efforts on Global Warming just long enough to address this horrible decision. lol.
Stephan — The “no IP ownership” is an anti-intellectual position (when take to its logical conclusions) because ideas (and agreements about those ideas) are the source of all property rights. “Ownership” is a right to action, and that is not concrete. You might like to draw boundaries at physical reality, but that is intellectually impossible to justify.
I think you need to rework your theory — in prior dicussions it appears you defend your position (no IP) as “libertarian” and other positions (some-IP) which don’t subscribe to the concrete rights only theory – as unlibertarian.
A whole lot of libertarians aren’t on board with the abuses, but they aren’t on board with a no-IP world either. Examples: domain-names couldn’t be owned, stock (you’d own only the paper and print?) could’t be owned, or derivatives would have no value (it’s an ephemeral agreement after all), or any right-to-action that isn’t supported by exchange of concrete goods (like a contract for labor, or a mortgage for future payment of dollars), would be rendered impossible. Money (these days) is almost entirely “abstract” (an exchange of electronic digits which have no value apart from the added agreements of the parties).
All contracts have an abstract, non-concrete part of their reality because they involve human thought, ideas, and action. The facts do not support this ideology at all.
JIMB,
I don’t know how you can call logical application of IP law abuse, given your support for IP.
> The “no IP ownership” is an anti-intellectual
> position
Yep. It is anti-intellectual (in a sense of government-paid “intellectuals” in academia who spend our money thinking of ways to create more artificial monopolies prohibiting us from making things better-faster-cheaper).
It is also anti-idiotic. No serious engineer I ever seen likes IP. A lot of them rebel, actively (by contributing to open source projects) or passively (by sabotaging patent paperwork demanded from them by their employer’s legal departments).
IP does not stimulate creativity, period.
> domain-names couldn’t be owned,
They aren’t, now. DNS is a distributed registration service, dependent on the willingness of people to use the commonly accepted name space and its servers. There’s nothing preventing creation of a parallel namespace. In fact, a lot of popular applications completely bypass DNS in favour of custom namespaces (IM, P2P, VOIP, etc apps are notorious in this respect).
What is “owned” is not the domain names per se, but rather contract obligations by the registration companies.
> or derivatives would have no value
This is totally ridiculous. Derivatives are not IP. Not under any non-kookish interpretation of this term.
> or any right-to-action that isn’t supported by
> exchange of concrete goods
All rights-to-action are supported by exchange of concrete goods if you bother to trace what exactly these derivatives, futures, contracts, etc specify. Even the “IP” ultimately boils down to the government’s promise to deliver a quite material bullet direct to the body of a transgressor. We live in a material world. Time to get used to that fact.
> The facts do not support this ideology at all.
The facts do not support your claims.
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