At Knewton, we prepare future lawyers and business leaders through our LSAT prep and GMAT prep courses; here’s hoping a few of them will be able to come to the defense of small businesses and sane patent law in the future.
Yesterday, Brad Burnham — a partner at Union Square Ventures — made a plea to create an Independent Invention Defense for patent cases. I would like to support Brad’s plea using a recent specific example: Klausner vs. Everybody.
Patents essentially give inventors the right to a monopoly on their inventions in exchange for publicly disclosing them. For an invention to be granted a patent it has to be useful, novel and non-obvious. However, at today’s pace of invention and information dissemination, certain types of patents (specifically software patents) no longer make sense. What is non-obvious at the time of a patent’s initial disclosure may become obvious at the time of a later invention — without subsequent inventors having any idea of an existing patent.
A significant source of risk for many small businesses (like Knewton) is Patent Trolls. Brad states that “almost a third of [Union Square Venture's] portfolio is under attack by Patent Trolls.” Patent trolls maintain a patent portfolio for the sole purpose of licensing the patents to other companies. They create additional costs to consumers through these licensing fees without providing any real additional value.
In July 2006, Klausner Technologies sued my former company Vonage for infringement of a 25 year-old patent on a Telephone Electronic Answering Device. The general idea of the patent is that answering machines basically suck. No one wants to listen to every single message to get to the one they care about, and most people only listen to the messages again to get the call back number. Klausner’s “revolutionary” invention was basically a printing calculator you attach to your phone that printed out the phone number of the caller and the time they called on a receipt.
That idea may have been novel in 1979, but not as much in the age of digital voicemail. By 2006 Vonage, AOL, Apple, eBay, AT&T, Verizon, Embarq and even Google were accused of essentially stealing Klausner’s idea. Is it possible that anybody at those companies happened to stumble upon Klausner’s patent? The answer is almost certainly no!
By 2006, the idea of accessing your voicemails out of order was as blindingly obvious as Amazon’s infamous 1-click patent. The Klausner patent was a clear combination of two other mainstream technologies: caller ID and digital storage. Given the broad application of Klausner’s patent, he probably could’ve sued every CD manufacturer for giving people the ability to randomly access audio files instead of needing to listen through all of them. He might even have had a case against the album Tommy Tutone 2, which contains the track “867‒5309/Jenny.” Random access audio? Check. Phone number? Check. Name? Check. Dependent claims met, sue ‘em!
An Independent Invention Defense, as Burnham proposes, would keep patent trolls like Klausner from undeservedly soaking up valuable time and money from other businesses and their customers. If you’re interested in supporting this effort, another VC, Brad Feld, is organizing entrepreneurs and investors in software innovation around the idea of an Independent Invention Defense.
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