Bloomberg News

Daimler, Facebook, Goldman Sachs: Intellectual Property

October 23, 2013

Daimler AG (DAI)’s contention that a patent covering sleepiness detection for vehicle operators is invalid, a federal appeals court said, upholding a lower court ruling.

The German automaker was sued for patent infringement in federal court in Newark, New Jersey, in October 2010. Ibormeith IP LLC of Longview, Texas, claimed that Daimler’s Mercedes-Benz Attention Assist driver drowsiness detector infringed patent 6,313,749.

The patent, issued in November 2001, was acquired by Ibormeith LLC in August 2010, and then transferred to Ibormeith IP LLC the same month the suit was filed.

Ibormeith is named for the Irish princess Caer Ibormeith, who would change into a swan every other year. According to court filings, the company is one of the entities that make up Medici Portfolio LLC, a patent firm begun by Michael Connolly, a former partner in Chicago’s McDermott Will & Emery LLP.

In September 2012, U.S. District Judge Faith S. Hochberg ruled the claims in the patent were too indefinite. Ibormeith then filed an appeal with the Washington-based U.S. Court of Appeals for the Federal Circuit.

The appeals court said yesterday that the lower court’s ruling was correct. The patent didn’t disclose enough information to make it possible to understand how the technology would work, the court said.

The patent application was handled by Young & Thompson of Alexandria, Virginia, according to the database of the U.S. Patent and Trademark Office.

The case is Ibormeith IP LLC v. Mercedes-Benz USA LLC, 13-1007, U.S. Court of Appeals for the Federal Circuit. The lower-court case is Ibormeith IP LLC v. Mercedes-Benz USA LLC, 10-cv-05378, U.S. District Court, District of New Jersey (Newark).

BlackBerry Bidders Weigh Patent Hoard Valued at Up to $3 Billion

Even as BlackBerry Ltd. (BB)’s sales tumbled in recent years, the company continued amassing patents, building an intellectual-property hoard that’s now central to its effort to entice bidders.

The struggling smartphone maker received 986 patents last year, a 49 percent increase from 2011, according to figures compiled by the Intellectual Property Owners Association. BlackBerry’s patents are valued at from $1 billion to $3 billion, depending on how many have been licensed out, analysts and patent experts estimate.

Working in BlackBerry’s favor: The patents cover similar technology as Apple Inc. (AAPL:US)’s intellectual property, and much of the portfolio is only a few years old. The downside is that the market for such assets has cooled. Previous patent buyers such as Apple and Google Inc. amassed broad portfolios in patent deals two years ago.

“This is an incredibly volatile market,” said Ron Laurie, managing director of Palo Alto, California-based Inflexion Point Strategy, who advises companies on patents. “It all depends on perceived demand and strategic value.”

Lisette Kwong, a Waterloo, Ontario-based spokeswoman for BlackBerry, declined to comment.

For more patent news, click here.

Trademark

Samsung’s Trademark Application Points to Extended Warranty

Samsung Electronics Co. (005930) filed for a U.S. trademark that may indicate the Korean maker of mobile devices is planning to compete with rival Apple Inc. over extended warranties.

Both companies manufacture smart phones and are presently involved in a patent dispute in federal court in San Jose, California.

Samsung is seeking to register “Samsung Protection Plus” as a trademark for “providing extended warranties on consumer electronic products and appliances,” according to database of the U.S. Patent and Trademark Office. The trademark application was filed Oct. 15.

Apple Inc.’s extended warranty is known as Applecare Protection Plan. The Cupertino, California-based company was sued by a Belgian consumer group in January over its extended warranty practices.

The lawsuit alleges that Apple misled consumers by advertising that its products had a one-year warranty and then selling a two-year extended warranty. European Union customers have an automatic two-year warranty on products they buy.

Facebook Tells Developer to Dismantle BreakYourFacebook site

Facebook Inc. (FB:US) sent a cease-and-desist e-mail to the developer of a tool that allows users to take scheduled breaks from the social media site.

The developer, Cody Romano, said on his blog that he received the e-mail from the Menlo Park, California-based company objecting to the web app he created, “Break Your Facebook.” He said he created the tool in the wake of recent revelations about the National Security Administration’s alleged snooping into users e-mail and social-media accounts, and the “frenetic pace” and “poor quality” of Facebook’s News Feed feature.

In the e-mail, Facebook said that Romano’s breakyourfacebook.com domain name infringes the social media company’s trademarks, and demanded that he quit using the name “Break Your Facebook” and disable the website.

The company also warned him not to “sell, offer to sell, or transfer” the domain name to a third party, and told him he should let his Internet domain name registration expire.

Romano said on his website that he knows he has to “break my app and let the domain die” because he lacks the resources for a legal battle with Facebook. He did take issue with the tone of the cease-and-desist letter, saying that he was “turned off” by the e-mail’s language.

For more trademark news, click here.

Copyright

Norwegian Director Plays Trick on Potential Infringers of Film

A Norwegian director is having the last laugh at those who are downloading a copy of his film through a website that uses the BitTorrent file-sharing protocol, according to the TorrentFreak anti-copyright news website.

Johan Kaos uploaded a copy of his film “Pornopung” to the Pirate Bay website, saying he thought the movie would end up there anyway and he wanted to have some fun with those who used the site to download and share it without authorization, according to TorrentFreak.

The film is a comedy about two men who give a third man advice about how to be attractive to women, with one of their tips involving removal of body hair from his genitals, TorrentFreak reported.

Kaos said the film he uploaded to PirateBay starts with 10 minutes of the film just as he made it, with the remaining two hours showing only an image of a shaven scrotum, according to TorrentFreak.

For more copyright news, click here.

Trade Secrets/Industrial Espionage

Goldman Ordered to Advance Ex-Programmer Fees for N.Y. Case

Goldman Sachs Group Inc. (GS:US) must advance computer programmer Sergey Aleynikov the legal fees he needs to fight New York state charges that he stole confidential source code from the company, a federal judge ruled.

Goldman Sachs at this time doesn’t have to pay the fees Aleynikov incurred defending federal charges that led to his conviction and imprisonment before the verdict was overturned, said U.S. District Judge Kevin McNulty in Newark, New Jersey. He said the two sides must engage in a pretrial exchange of evidence on that question.

“Immediate advancement of fees is required, subject only to an unsecured undertaking to repay them if the applicant is unsuccessful in the underlying litigation,” McNulty said in an opinion made public yesterday.

Aleynikov was convicted in federal court in Manhattan in 2010 of stealing hundreds of thousands of lines of code and sentenced to 97 months in prison.

He was ordered freed in February 2012 when the U.S. Court of Appeals in New York reversed his conviction. In August of that year, he was arraigned in Manhattan on state charges of unlawful use of scientific material and duplication of computer-related material. He was the subject of a sympathetic profile in Vanity Fair magazine.

Goldman Sachs, which employed Aleynikov from May 2007 through June 2009, argued that it didn’t have to pay his fees in a state prosecution because he wasn’t an officer of the company, even though he was a vice president.

McNulty disagreed.

“It may be the case that Goldman (or the industry of which it is a part) has been profligate in conferring the title of vice president,” the judge wrote. “If so, Goldman must bear the consequences of that profligacy. Goldman might easily have chosen to be more sparing with job titles, or to confer them in some other way.”

Michael DuVally, a spokesman for New York-based Goldman Sachs, declined to comment on the ruling.

The case is Aleynikov v. Goldman Sachs Group Inc., 12-cv-05994, U.S. District Court, District of New Jersey (Newark).

IP Moves

Article One Partners Names Marshall Phelps CEO

Article One Partners hired Marshall Phelps as chief executive officer, the New York-based provider of crowd-sourced patent research said in a statement.

Phelps is the former corporate vice president of IP policy and Strategy at Microsoft Corp. (MSFT:US) and former corporate vice president of IP and licensing at International Business Machines Corp. (IBM:US) He is the author of “Burning the Ships: Transforming Your Company’s Culture Through Intellectual Property Strategy.”

He has an undergraduate degree from Muskingum College, a Master of Science degree from Stanford Graduate School of Business and a doctorate from Cornell Law School.

To contact the reporter on this story: Victoria Slind-Flor in Oakland, California, at vslindflor@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.


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