11/02/2006

More "Patent Parking" Extortion Slimeballs

Back in 1994, Richard Snyder, chairman and CEO of Forgent, said, "Forgent is committed to developing all of its assets and technologies to maximize shareholder value. We believe we will prevail in this litigation, as the '672 Patent is valid, enforceable and infringed."

In 2001, Forgent retained Jenkens & Gilchrist, a national law firm, to assist Forgent in protecting its intellectual property from infringement through licensing and, if necessary, litigation, including those claimed in U.S. Patent No. 4,698,672 (the '672 Patent). On October 27, 2004 Forgent formally terminated its relationship with Jenkens & Gilchrest and retained Godwin Gruber to advise it in connection with the patent licensing program.

Essentially what this company did was to embark on a professional extortion program with it's various patents, attempting to get revenues that way, since nothing else they
were doing was making any money for the shareholders.

The defendants identified in the Forgent lawsuit read like a Who's Who in Technology. Named defendants include Adobe Systems, Agfa, Apple Computer, Axis Communications, Canon USA, Concord Camera, Creative Labs, Dell, Eastman Kodak, Fuji Photo Film, Fujitsu Computer, Gateway, Hewlett-Packard (NYSE: HPQ) , IBM (NYSE: IBM) , JASC Software, JVC, Kyocera, Macromedia, Matsushita, PalmOne, Panasonic, Ricoh, Broderbund, Savin, Thomson S.A., Toshiba and Xerox.

The claim to the JPEG standard has long been a bone of contention with the Joint Photographic Experts Group committee, which has worked to create standards related to the JPEG file format since it was devised in 1986.

When Forgent first staked its claim to JPEG compression technology, the JPEG committee denounced attempts to derive fees from the standard and expressed disappointment at Forgent's attempts to do so.

Today Forgent said it will receive $8 million to settle lawsuits against Microsoft and two dozen other companies over claims its patent covered the main technology for digital-image compression on computers. For patent parking, that's small change. Eolas won something like $500 million for its little extortion scheme, forciing Microsoft and others to jump through hoops to make browsers comply, and making a lot of consumers (including me) very, very mad.

The company's ability to get more money from the patent is "substantially concluded," Forgent said in a regulatory filing Monday.

In June, U.S. District Judge Jeremy Fogel in San Jose, Calif., sided with computer companies in ruling Forgent's patent covers only video compression, not the still-data compression standard known as JPEG. The company had collected more than $100 million in settlements before Fogel's ruling, making up almost all of its revenue for the past five years.

Thankfully, it looks like they are now out of the extortion business for a while.

I've written about this abominable practice of what I call "Patent Parking" before -- companies who sit on various patents, never developing any products with them, only using them as legal fodder to extort huge sums from other organizations that do. These slime are no better than the small-time Mafioso who extorted payola from the shopkeepers in Brooklyn so that "nothin' bad will happen to yer store". The only difference is that these scum are doing it with public shareholder money in the public arena, taking advantage of a Patent & Trademark Office that doesn't have the resources to supervise correctly in the marketplace.

N.B. I recently noticed that good friend (and developer extraordinaire) Brent Ashley had his original "JSRS" (Javascript Remote Scripting) technique, which I consider to be the "true father" of AJAX Remote Scripting, "lifted" by some outfit that essentially immorally stole his open-source code and proceeded to obtain a patent on it. Will the horrors never end? Brent, I'd be pissed too. They have no couth. Don't kid yourself. This "Patent extortion" scheme is becoming big business, and its a reality. (my other post about this)


FTC Nails Spyware Vendors

In other news, the FTC nailed 180 Solutions and came out with the first real definition of "Express Consent" for downloading on the part of the consumer:

“Express consent” shall mean that, prior to downloading or installing any software program or application to consumers’ computers: (a) Respondents clearly and prominently disclose the material terms of such software program or application prior to the display of, and separate from, any final End User License Agreement; and (b) consumers indicate assent to download or install such software program or application by clicking on a button that is labeled to convey that it will activate the download or installation, or by taking a substantially similar action.

This is probably the most important part of the CONSENT decree, since it sends a very clear message to the rest of the spyware slimeballs what standards the FTC intends to use. Good Riddance, WebTards!