2021-04-12

The Mystery of the Dial-up Dinosaur

IP without Jargon By Todd Bailey, Scale AI* (4 minute read) - April 15, 2021

Generating value in today’s digital world is easier than ever. So is copying and stealing.

But you can reduce the risks by protecting your IP (intellectual property). Although information about IP is everywhere, Scale AI wants to help you transform IP information into IP action. In this blog, IP without Jargon, we’re unpacking IP concepts, debunking IP myths and, along the way, throwing in some IP terminology [in square brackets] to help you learn the lingo. Let’s go.

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The Mystery of the Dial-up Dinosaur

Each year, IBM obtains more patents than anyone else – more than Google, Microsoft, Amazon and Facebook, combined. IBM says it files patents to earn licensing revenue, defend itself in lawsuits, and provide leverage in negotiations.

Not many can afford to patent as much as IBM, but listen to their approach: “The market is moving so quickly that it’s hard to predict.  That’s one reason our patent portfolio is broad”, an IBM VP said. “Any one of those areas might take off and become successful for us.”  In other words, IBM responds to market speed and uncertainty by adapting its patent approach. 

Last week, we were mystified how IBM patents from the 90s could be infringed with today’s technology. The patents came from a time before the web, broadband, mobile or the internet economy. 

Clearly those areas have “taken off”, to use IBM’s words. 

And guess what? IBM has patents.

But what does it really mean when IBM says Airbnb “infringed” their patents? And how could a patent from the 90s still be relevant today?

Opening the IBM patent, you’ll find MS-DOS computers using “diskettes” and other “peripherals” to access networks through dial-up via landlines. You might quickly appreciate why this patent was recently called a “Dial-up Dinosaur”.

The mystery deepens.

Patent infringement.

IP Myth: Technology moves too quickly for patents to be important.

IP Fact: All major tech companies, from Airbnb to Zoom, are investing in patents.  They don’t believe this myth, and neither should you.  Well-planned patents are as valuable as ever.

We discovered previously that it’s the patent claims that define what’s protected. Think recipe, with ingredients. The patent owner can “veto” others from using the recipe.

A patent is violated [infringed] when someone, without permission, uses all of the elements of a patent claim. Everything in the recipe.

Notice that I said “a” patent claim. Infringement requires only that all the ingredients of one claim are present. (A patent has many claims, or recipe variations, just to improve the odds.)

So, infringement may involve only one claim – but requires all ingredients of that claim.

If anything is missing, it’s probably not infringement (but substitutions can complicate things). Having extra ingredients won’t avoid infringement if all listed ingredients are still present.

Summing up, patent infringement requires all elements of at least one claim.

Patent enforcement.

IP Myth: The patent office will prevent others from infringing my patent.

IP Fact: Patent owners have the responsibility of ensuring others respect their patents.

There are no patent police. IBM had to sue. Which brings us back to our mystery: how could Airbnb infringe a “Dial-up Dinosaur”?

But now you know the answer. You don’t even need me anymore.

We look at the claims…yes!!!

Ok, you’re the judge. Your Honour, please turn to Claim 1 (bottom of 2nd-last page): “A method for presenting advertising obtained from a computer network… to communicate with users…through a device…having a visual screen…” (etc.)

Are all of the elements of this claim present, Your Honour?

  • Airbnb definitely “presents advertising” – condos for rent. Check.
  • Airbnb uses a “computer network” – the web is a computer network. Check.
  • Airbnb has users using devices with screens – smartphones. Check.
  • And so on.

That’s how it works. Compare something to a claim to see if all ingredients are present.

It doesn’t matter if what’s described in the patent is different than the infringer uses, or even if the infringer’s approach is better.  For infringement, only the claims matter.

Patent lawsuits result when parties disagree whether all the ingredients are present. A settlement before trial means they prefer a negotiated business deal instead of letting the courts decide.

IBM and Airbnb settled their dispute, confidentially. Perhaps IBM agreed to a contract authorizing Airbnb’s use [patent license].  Maybe Airbnb had to pay some money [license fees, or royalties], or perhaps as payment IBM instead obtained permission to use Airbnb’s patents [cross-license]. These are typical ways infringement lawsuits are settled.

More importantly, the mystery is finally solved!  You now understand how a Dial-up Dinosaur might be relevant today. There aren’t many people who can say they understand that. Good job!

In the end, patent infringement all comes down to ingredients, and recipes.

But before you go: take a moment to think about how the IBM patent claims stayed relevant despite fast-moving changes in tech.  They did it by having claims focused on function, and not just the technology of the day. We’ll come back to this essential patent concept in a future post.

In our next post, we’ll take a much-deserved break from patents to discover that copyright might already be protecting aspects of your business – without you even knowing it!

Takeaways.

  • A patent claim is like a recipe, with ingredients.
  • Patent infringement requires that someone has all elements of at least one claim.
  • Only the claims matter to patent infringement.

*Todd is Chief IP Officer at Scale AI, and a lawyer, patent agent and IP strategist with 25 years’ experience helping startups, SMEs and multinationals protect and commercialize their IP.

Please Note: Concepts discussed here have been simplified to facilitate learning. You should consult a qualified IP lawyer or agent to discuss your unique IP needs. Protecting your IP should not be a do-it-yourself project.

Scale AI is Canada’s AI Supercluster, investing in AI supply chain projects, acceleration and talent development across Canada. Visit us at www.scaleai.ca to see how we can help your business grow.

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