The Open Road

Everyone hates patent trolls (except, perhaps, the patent trolls' mothers). But it's easier to despise patent trolls when you either have a lot of patents, or none. What if your company were awarded a significant patent that could be used to shake down Google and the rest of the industry for corporate benefit.

Or buy food for your family?

Is it your fiduciary duty to exercise that patent? Is it a personal duty? And do you have the legal right to do so?

The first two questions are tricky, but the last one is currently being considered by the U.S. Supreme Court. Consider yourself lucky that you don't have to decide it.

Bilski and business method patents

Recently, the U.S. Supreme Court heard oral arguments in the controversial Bilski case where IBM, typically friendly to open source and innovation, backed the wrong horse. According to The Wall Street Journal's coverage of the arguments, the justices were skeptical--if not contemptuous--of the case put forward by Bilski and the proponents of business method patents.

Chief Justice John Roberts quipped that business method patents are akin to patenting the idea that "I buy low and sell high. That's my patent for maximizing wealth."

Silly when presented in this way. But perhaps silly when presented in just about any way.

Business method patents came into being 20 years ago with the Federal Circuit's State Street decision, the case that spawned Bilski. Two of the best-known technology examples of such patents are Amazon's one-click checkout and Priceline's reverse auction.

In a September blog I took IBM to the woodshed for its stance on Bilski. Big Blue filed an amicus brief (PDF) that I argued was disingenuous at best. IBM argued:

Patent protection has promoted the free sharing of source code...which has fueled the explosive growth of open source software development.

Really?!?

IBM was not alone. Novartis, the big pharmaceutical company, also filed a supporting brief.

The industry's moment of (in)decision

I think that the Bilski case is a divider of wheat from chaff, a moment that forces technology companies to take sides on a critical issue that goes to the heart of innovation in our economy.

On one side, companies such as IBM and Novartis maintain that patents should not be tied to "primitive physical technology" but should also embrace a broader range of modern business activities.

But other companies, including Google and Symantec, took the other side and filed briefs (PDF) with the Supreme Court arguing that expanded business method patents would open them up to infringement lawsuits over the "very mental processes and ideas that are the building blocks of innovation."

What would you do? LogLogic and Sponster examples...

I was reminded of this issue by an announcement today from LogLogic, a log management and security company I wrote about last year as an example of the pervasive use of embedded Linux.

LogLogic was granted a patent in October that appears to be rather sweeping in its scope, covering the collection of logs and the management of the data in those logs.

Imagine if LogLogic went "troll" with this patent....

At a minimum it could be a nuisance to its competitors and at a maximum it could possibly shake down any company that sold a product that relied on log collection (describing hundreds, if not thousands, of products on the market today).

Or how about this one? Sponster has a patent on a system for delivering contextual ads against electronic messages like e-mail, SMS, tweets, etc. Google filed for a similar patent, but over a year after Sponster, and while Sponster's patent was recently granted in October, Google's was denied. (Disclosure: I know and am friends with one of the Sponster executives.)

On the one hand, Sponster could go troll and sue just about everyone on the Web. On the other hand, I know from talking with the executives that they have no desire to do so. The fact that the company has not sued anyone in its six-plus years of existence is a clear indication of this. Sponster wants to build its business around the patent, but Google or Microsoft with their heft can squash that desire.

Should Sponster fight or capitulate? It's easy when you think of patent trolls as trolls that create no real value. But what about when they are real people and real companies like Sponster and LogLogic?

LogLogic makes its choice

LogLogic appears to have made its decision. In a company blog on Wednesday, a LogLogic executive points out the potential harm they see in a Bilski decision by the Supreme Court that would allow broader business patent methods.

LogLogic also (correctly, in my view) argues that the anti-business method lobby of Google et al "represent[s] the true innovative spirit of Silicon Valley where entrepreneurs are rewarded for risk taking and embrace the thinking of Austrian economist Joseph Schumpeter and creative destruction."

LogLogic decided to take a defensive posture with this sweeping patent rather than go troll. Who knows what Sponster will do, or should do. Presumably it worked just as hard on its technology as Google: shouldn't it get paid?

More broadly, do you agree with IBM that business methods should be upheld, or with Google that they should be crushed? What would your company decide to do? Where do you stand?