As industry and public interest groups wait for the president to fill the remaining positions in his administration, such as the new position of intellectual-property enforcement coordinator, opposing sides of the copyright debate are speaking up.
The Copyright Alliance, along with 40 other groups representing intellectual-property holders, sent a letter (PDF) to President Obama on Monday arguing that intellectual-property protection stimulates creativity and creates jobs.
The letter was sent in response to an earlier letter, sent by 19 different groups, that urged the president to choose administration officials who "reflect the diversity of stakeholders affected by IP policy."
The April 2 letter, signed by groups including Public Knowledge, the American Library Association, and the Consumer Electronics Association, said that, "To date, several of (Obama's) appointees to positions that oversee the formulation and implementation of IP policy have, immediately prior to their appointments, represented the concentrated copyright industries."
The president has, in fact, filled out some high-level Justice Department positions with lawyers favored by the copyright industry, including attorneys who have represented the Recording Industry Association of America and the Business Software Alliance. The signatories of the April 2 letter said the Justice Department's intervention last month in favor of a record label in a file-sharing case heightens their concern.
"We ask you to consider that individuals who support overly broad IP protection might favor established distribution models at the expense of technological innovators, creative artists, writers, musicians, filmmakers, and an increasingly participatory public," the letter said. "Overzealous expansion and enforcement of copyright, for example, can quash innovative information technologies, the development and marketing of new and useful devices, and the creation of new works, as well as prohibit the public from accessing and using its cultural heritage."
The letter also asks the president to create new offices in agencies like the State Department dedicated to promoting innovation, to counter the enforcement-focused IP enforcement coordinator position.
The letter sent Monday by groups like the Directors Guild of America, the Entertainment Software Association, and Time Warner countered that "enforcement of copyrights and patents and protecting the freedom to create and be compensated for it are essential components of promoting the progress of sciences and arts, as articulated so clearly by our Founding Fathers in the U.S. Constitution."
IP protection and promoting innovation are not mutually exclusive, the letter continued.
"Intellectual property drives innovation and creativity, from the production of new creative works to the development of consumer electronics and medicine," it said.
The letter sites research indicating that the creative industries employ 38 million U.S. workers and points out that copyright and patent protections apply to a number of different businesses including movies, visual arts, video games, computer software, and pharmaceuticals.
The intellectual property holders said in their letter that Obama's administration is diverse in experience and perspectives and that the president's appointees so far have been solid choices.
"We have every confidence these hallmarks will be demonstrated in your future IP policy appointments," their letter said.
Now that the U.S. Court of Appeals has ruled that abstract processes, or business methods, cannot be patented, it's important to look at how this could affect the tech industry.
The case in question was rejected because the patent at issue was a process not tied to a "machine," which is one standard for patentability.
Overall, it seems like a ruling that should favor companies that make hardware and software because while it narrows the types of patents that can be filed, in return should protect them from the frivolous patent suits that have flooded the industry in the past few years.
"We've seen a rise in the number of lawsuits against tech companies in the IT area specifically. Many are very questionable patents, and the patent office is overwhelmed," said Jason Schultz, acting director of The Samuelson Law, Technology & Public Policy Clinic at UC Berkeley. "It will reduce the number of patent applications which are filed in the IT space--especially by these questionable entities or companies trying to patent trivial things."
"Trivial things" like broadly defined behaviors, or obvious ideas, such as credit-card processes for e-commerce, or shopping carts for Web sites--things that some companies have attempted to patent that have more to do with a process and less to do with a machine.
One of the advantages of this type of decision is "it allows the patent office to make quick and easy rejections instead of deep, technical rejections, which are intense substantive analytical decisions," added Schultz.
In other words the entire patenting process could be sped up because there would be fewer patents filed over time.
The nonprofit Washington, D.C.-based Computer and Communication Industry Association agreed it would be a boon to the companies it represents.
"The Federal Circuit's opinion implicitly recognizes that an out-of-control patent system was not promoting progress, but rather impeding it," said CCIA President Ed Black. "The standard articulated in this case should limit the outrageous business method and software patents that we have recently seen without undermining the incentive to innovate in these areas."
Some tech companies worried the ruling could go too far, but it doesn't appear that's what happened. It doesn't necessarily mean that more patents on higher-quality hardware or software will be rejected right away, it will just require a little finesse. Most tech companies should be safe, as long as the process they're trying to patent it tied to a computer, which definitely counts as a machine, according to Brent Yamashita, partner in the patent litigation group for DLA Piper.
The decision "may be adverse for some business method patents that already exist, but in most cases a skillful patent attorney would be able to still get a patent for his or her client...by making sure the process being described is tied in with the actual machine or tangible such as a computer," said Yamashita.
"There are already are many patents drafted that way. In the future, practitioners just need to be careful to make sure they don't just describe a process in the abstract," he noted.
That means instead of giving a broad description of a product (like listening to music from a remote device) they have to be much more specific and narrow about what they claim to have invented (how the process of listening remotely is tied to a specific device or service).
In all, "I think (it) will be good for everybody," said Schultz.
Verizon Communications suffered a major blow in its patent battles on Monday, when a federal court ruled that cable company Cox Communications had not infringed on its patents.
The telecommunications giant has accused Cox of violating six of its patents related to Internet telephony. But a jury for the U.S. District Court for the Eastern District of Virginia decided against Verizon on all six patents.
Verizon settled a similar suit against digital-phone service provider Vonage last year, squeezing about $117.5 million from the troubled provider of voice over Internet Protocol, or VoIP. Against Cox, it had been seeking past damages of $404 million.
Many analysts and experts believed that Verizon had been emboldened by its Vonage patent battle and was looking to go after bigger players, such as cable providers. Companies such as Cablevision, Comcast, and Time Warner Cable have been offering VoIP services for the past few years. And they've been very successful in converting millions of Verizon customers to their service.
But with this latest court decision, it looks as if Verizon may have to rethink its legal strategy. The company recently reached a deal with Comcast in which both companies agreed not to sue each other for a period of five years for any patent infringement. But there had been speculation that Verizon might target Time Warner Cable and Cablevision.
"Despite the decision, we believe our patents were infringed," Verizon said in a statement. "We will continue to innovate and protect our intellectual property."
The company also told The Wall Street Journal that it hasn't decided whether to appeal the decision.
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