[asterisk-biz] Verizon v Vonage

[Peter Beckman]

On Wed, 21 Feb 2007, Paul wrote:

> The US needs some fresh legislation related to the patent system.
> Perhaps some lower cost ways to challenge bogus patents long before you
> get sued would help. Right now it looks like the only way to deal with
> them is to wait until the threats and bullying get started.

  [Long post regarding how patents are used as an offensive deterrent to
   competitors, and the realities of fighting a bogus issued patent.]

  IANAL but I'm married to a patent/trademark lawyer.  One of the biggest
  problems is that the people who review patents at the USPTO are not deep
  in every market that they review for, so they can't just pull prior art
  (that would reject the patent) from their backside.  Additionally, SOOOO
  many patents are filed daily, the backlog at the patent office is huge.
  2-5 years to get a patent issued, and usually that means 30+ back and
  forths between the patent office and the patent applicant.

  Anyone can submit prior art during a patent application (I think), but
  nobody has the time to spend looking through all the patents submitted on
  a daily basis to see if they know of prior art that exists.  This is why
  companies like Verizon, who have the money to argue with the patent office
  until they "give in" and issue a potentially bogus patent.

  Then companies like Vonage have to spend lots of money to defend
  themselves against bogus patent claims, and Verizon, even if their patents
  are overturned, have drained Vonage of a whole bunch of money, time and
  effort, which makes it difficult for Vonage to innovate, advertise, etc
  since so much money is going into document review, legal work, briefs,
  being in court, etc.  We're talking hundreds of thousands of dollars in
  legal fees a week, maybe even per day.

  My wife worked for a large patent/trademark firm in Washington DC, and
  just the team that would be in the courtroom cost $3000-8000 per
  hour.  Yes, I didn't miss any zeros there.  Then there is all the work
  that goes on outside of the courtroom, continuing at an insane hourly
  rate.

  Verizon is using these patents to outspend Vonage and bring them to their
  knees, because every customer Verizon loses to Vonage means a loss of
  $600/year/customer.  If you lose 1M customers to Vonage, you don't mind
  spending a few million dollars to hurt your competitor, hopefully to the
  breaking point.  I'm fairly confident Verizon didn't create the "Network
  Interface Device" or if they did, it covers the plastic box outside your
  house, not your VoIP adapter.  But maybe it does.

  Patents have become an offensive tool for big business.  If you can get a
  patent past the USPTO, you can start putting small competitors out of
  business, those who can't fight a patent battle to overturn your silly
  bogus patent.  Then when someone is big enough to fight, if you are
  bigger, you can still hurt them.

  I don't know what fresh legislation can be introduced, but I would agree
  with Paul that a lower cost way to challenge patents would potentially
  help.  The problem is you still need a lawyer to interact with the USPTO,
  and even that is more than some of us want to spend.

Beckman
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Peter Beckman                                                  Internet Guy
beckman at purplecow.com                             http://www.purplecow.com/
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