A colleague of mine contributed an additional reference to Rich Cooper's
contribution. (01)
-------- Original Message --------
Subject: Re: [Fwd: [ontolog-forum] (Software) Patent litigation]
Date: Thu, 23 Sep 2010 17:24:56 -0400
From: Guillaume Radde <guillaume.radde@xxxxxxxx>
Reply-To: msidtechtalk@xxxxxxxx <msidtechtalk@xxxxxxxx>
To: Multiple recipients of list <msidtechtalk@xxxxxxxx>
References: <4C9BBC97.8050205@xxxxxxxx> (02)
Here is another interesting paper to reference when talking about
software patents, from american economist and Nobel price laureate Eric
Maskin: (03)
http://www.researchoninnovation.org/patent.pdf (04)
Guillaume (05)
> -------- Original Message --------
> Subject: [ontolog-forum] More on patents
> Date: Thu, 23 Sep 2010 12:43:08 -0400
> From: Rich Cooper<rich@xxxxxxxxxxxxxxxxxxxxxx>
> Reply-To: [ontolog-forum]<ontolog-forum@xxxxxxxxxxxxxxxx>
> To: '[ontolog-forum] '<ontolog-forum@xxxxxxxxxxxxxxxx>
>
>
>
> Hi Ontologizers,
>
>
>
> Since we have recently been discussion patents wrt ontologies, this
> statistical study of patent litigation might be of interest to many
> readers of this list. Please see below for news item posted on a patent
> list I subscribe to.
>
>
>
> HTH,
>
> -Rich
>
>
>
> Sincerely,
>
> Rich Cooper
>
> EnglishLogicKernel.com
>
> Rich AT EnglishLogicKernel DOT com
>
> 9 4 9 \ 5 2 5 - 5 7 1 2
>
> ------------------------------------------------------------------------
>
> *Bombshell Study: Heavily Litigated NPE Patents Overwhelmingly Lose at
> Trial<http://feedblitz.com/r.asp?l=50410480&f=151161&u=191723&c=0>***
>
> To date, litigated patents were viewed as "strong" patents - the types
> that defendants were supposed to avoid taking to trial. Moreover,
> litigated patents were seen as more valuable, since they managed to
> survive an all-out attack on validity by a presumably well-financed
> defendant. Earlier studies (John R. Allison /et al/., /Valuable
> Patents/, 92 Geo. L.J. 435 (2004)) looked at litigated patents,
> and found that they differed from non-litigated patents in that they (1)
> include more claims, (2) cite more prior art, (3) are cited more often
> by later patents, and (4) come from larger "families" of
> patents/continuations. Each of these factors are now used in
> conventional methodologies to determine the private value of patents.
>
> John Allison
>
><http://www.feedblitz.com/t2.asp?/151161/191723/0/http://papers.ssrn.com/sol3/cf_dev/AbsByAuth.cfm?per_id=118168>,
> Mark Lemley
>
><http://www.feedblitz.com/t2.asp?/151161/191723/0/http://papers.ssrn.com/sol3/cf_dev/AbsByAuth.cfm?per_id=32215>
> and Joshua Walker
>
><http://www.feedblitz.com/t2.asp?/151161/191723/0/http://papers.ssrn.com/sol3/cf_dev/AbsByAuth.cfm?per_id=1533021>
> recently took on the task of identifying every patent that was litigated
> eight or more times between 2000 and February 2009, including cases
> still pending, and compared the outcomes of the cases against patents
> that were litigated only once. In the course of their analysis, they
> found 106 such patents, which have been litigated in a total of 2,987
> different patent assertions in 478 different cases, often against
> multiple defendants.
>
> What did they find? Serial patent litigants, and particularly NPE's
> (aka "trolls"), for a lack of a better phrase, "get creamed" when they
> go to trial:
>
> [T]o our great surprise, *we find that the willingness of
> these patentees to litigate their cases to judgment is a
> mistake*. Far from being stronger than other litigated patents,
> the most--litigated patents that go to judgment are far more
> likely to be held invalid or not infringed. The differences
> are dramatic. Once-litigated patents win in court almost 50%
> of the time, while the most-litigated – and putatively most
> valuable – patents win in court only 10.7% of the time.
>
>
>
> The results are equally striking for patents owned by
> non-practicing entities (NPEs), and for software patents. NPEs
> and software patentees overwhelmingly lose their cases, even with
> patents that they litigate again and again. Software patentees
> win only 12.9% of their cases, while NPEs win only 9.2%.
>
>
>
> [S]tatistical tests bear this out. We compare the proportion of
> win rates, testing the null hypothesis that there is no
> difference between the most-litigated and once-litigated patent
> outcomes. We test the proportions in several ways, both
> including and excluding settlements in the denominator of
> decided cases, and both including and excluding default
> judgments as plaintiff wins. *No matter which test we use, the
> differences are highly statistically significant – the
> most-litigated patentees were more likely to lose*.
>
> Also,
>
> Considering only the patents themselves, the proportions of
> initial ownership by large and small entities are almost equal
> in the most- and once-litigated data sets: 53.5% of
> most-litigated patents and 47.8% of once-litigated patents were
> issued to large entities. The picture is quite different,
> however, when one looks at the proportion of actual assertions
> in litigation, where large entities account for a surprisingly
> small percentage of the most-litigated patents. Because small
> entities are disproportionately represented in the actual
> litigation of most-litigated patents . . . patents that were
> initially issued to large entities represent only 22.4% of the
> assertions in the most-litigated group, compared to 47.8% of
> the once-litigated group.
>
>
>
> [W]hen the cases do not settle, large patent plaintiffs are
> significantly more likely than small ones to win, without
> regard to how the data are sliced. When we combine the two
> data sets, large entity plaintiffs win 53.1% of the cases
> decided on the merits (55.9% if default judgments are
> included), while small entity plaintiffs win only 12.3% of
> their cases (23.1% if default judgments are included).
>
> Other interesting findings:
>
>
>
> - Just 16.7% of the assertions of the most-litigated patents were made
> by product-producing companies.
>
>
>
> - Software patents constituted 20.8% of the once-litigated patents but
> 74.1% of the most-litigated patents.
>
>
>
> - Owners of non-software patents are far more likely to win their cases
> than are software patent owners (37.1% versus 12.9% overall)
>
>
>
> - The number of defendants per case is a negative predictor of
> settlement - the more defendants there are per case, the less likely the
> case is to settle. Also, the more defendants there are per case the
> more likely those defendants are to win.
>
>
>
> The study concludes:
>
> We designed this study to explore the effects of repeat play
> on litigation behavior, contributing to a literature on the
> economics of civil procedure as well as the substance of
> patent law. But what we found was dramatic and unexpected:
> The patents and patentees that occupy the most time and
> attention in court and in public policy debates – the very
> patents that economists consider the most valuable – are
> astonishingly weak. Non-practicing entities and software
> patentees almost never win their cases. That may be a good
> thing, if you believe that most software patents are bad or
> that NPEs are bad for society. But it certainly means that
> the patent system is wasting more of its time than expected
> dealing with weak patents. And it also suggests that both our
> measures of patent value and our theories of litigation
> behavior need some serious reconsideration.
>
> Read/download "Patent Quality and Settlement among Repeat Patent
> Litigants" (link
>
><http://www.feedblitz.com/t2.asp?/151161/191723/0/http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1677785>)
>
>
>
>
> (06)
--
Guillaume Radde
Software and Systems Division
National Institute of Standards and Technology
guillaume.radde@xxxxxxxx
(301) 975-6145 (07)
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