The Linux Foundation is deepening its existing partnership with Unified Patents, a membership organization that assists companies in battles against ‘patent trolls’. The Cloud Native Computing Foundation (CNCF) is now a full partner in this collaboration. This collaboration is much needed, says Mike Dolan of the Linux Foundation, because cloud-native applications are the new cash cow for trolls abusing patent law.
The partnership allows both Linux Foundation and CNCF members, more than 1,300 companies and organizations, to use Unified Patents (UP) services. Provided they become members of UP, of course. Those services include comprehensive risk and portfolio analyses, which UP uses to check, for example, whether an open-source project is at risk of falling victim to a known patent being abused. The company or organization behind the project can then take measures to stay ahead of a future suit.
Striking down questionable patents
Participation is available in several tiers. Platinum members get access to the PATROLL programme, through which UP (upon request) tracks down questionable patents and attempts to have them struck down, sort of like a bounty hunter. A recent case is the challenging of a particular Kubernetes patent. Such actions do not immediately invalidate the patent but build toward it and give affected parties more ammunition should the case eventually get to court.
Members can also choose to sponsor such campaigns, a bit like crowdsourcing to provide collective financial support for these often protracted cases. It also happens that UP buys up orphaned patents (that are up for grabs after the original patent holder has gone bankrupt) to prevent them from falling into the hands of patent trolls. Unified Patents itself does not provide legal advice.
These trolls are all too real
Patent trolls, also called non-practicing entities or NPEs in legal jargon, are individuals or companies that hold patents but do not use them to develop products or services. Instead, they sue other companies that allegedly infringe these patents.
‘Allegedly,’ because, in the words of Mike Dolan of the Linux Foundation, they are usually patents of little value. “The NPEs often buy up such patents from the estates of bankrupt companies. So they haven’t even developed the idea behind such patents themselves.” What makes the patents qualitatively bad is that they describe a particular idea in vague or very general terms.
If an NPE buys such a patent and does a little homework, it can always find companies supposedly infringing upon the patent. Whether such a case stands a chance in court is another matter, but many companies that fall victim to such a patent troll do not want to drag out legal proceedings. And so they decide to pay up.
Paying up to keep a case out of court
Chances are that the idea or technology has now become commonplace, and the original patent is obsolete. That makes the claim technically worthless, but not everyone has the stomach or financial power to challenge it. Moreover, there is always a small chance that a court will uphold the claim despite everything.
“A claim by a patent troll doesn’t always lead to lengthy litigation,” Dolan tells us. As Senior Vice President and General Manager of Projects and Legal on behalf of the Linux Foundation, he acts as spokesperson for the collaboration with Unified Patents. “A patent troll figures out the cost of a lawsuit to the company they’re targeting. They often demand an equal amount to keep the case out of court.”
Smaller companies are vulnerable
“There may then be some negotiation about the exact amount,” he continues, “but either way, these are not things you want to get involved with as a company. It’s also often not the largest companies that are victims of these practices; smaller companies without an army of lawyers at their disposal are particularly vulnerable.”
According to Dolan, going into battle quickly costs around 2 to 3 million dollars (1.8 million to 2.7 million euros). Proactively eliminating a weak patent—that is, before it ever comes to a trial—costs an average of about 400,000 dollars or over 360,000 euros. That’s not cheap either, but much less expensive, especially if several shoulders carry this burden. According to Dolan, the success rate for such a course of action is 90 percent.
The Linux Foundation’s collaboration with Unified Patents dates back to 2019, with the creation of an Open Source Zone specifically focused on protecting open source projects from patent trolls. This collaboration has now deepened and offers multiple levels of services.
Consultancy and analysis
Platinum members will have access to the full suite of support, including the ability to contribute to the PATROLL programme to actively eliminate abused patents (and, for example, put a bounty on a weak patent of their choosing). The higher tiers also entitle members to consulting and analysis tools. All members receive insight into the latest developments, standards and policy changes, get a risk analysis and may attend events such as the IP Forum in Munich.
According to Dolan, CNCF’s entry into this program as a full member is much needed. He says patent trolls are increasingly targeting projects that involve cloud-native technologies, such as Kubernetes and containerization. “You see the focus shifting from Linux components and databases to this kind of technology,” he said. Some patent trolls even manage to secure funding for their ‘business model,’ so working together is needed to have sufficient financial and organizational clout against such parties.
Mike Dolan, a lawyer himself and from the U.S., admits that most of these cases happen in America. Yet European parties are also regularly victims, although he says he does not know how often when compared to American companies. “But consider that these are components or technologies used everywhere. So even if it’s more often about American players, in Europe you can certainly feel the effect.”