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Comment by turbohz | Hacker News Reader

> Every time a company settles it just funds the trolls to wreak more havoc. This is especially true for companies larger than $100 million in revenue. I’m looking at you Texas Instruments, VIA Technologies, Renesas, ASUS, Caterpillar, Nuvision International, and Netgear, just to name a few of the companies that have dealt with Jason Nguyen’s Altair Logix. When you roll over and pay the trolls it hurts smaller companies terribly.

I wonder if those companies consider this a "feature"?

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That was my first thought too. In this way, it serves a similar purpose to overly strict regulation, which is also something smaller companies have a much harder time dealing with than larger ones (and encouraging regulation of a specific area is a well known tactic of larger companies to raise the bar of entry to the market).

That's not to say all regulation is bad, just that like most things that have beneficial ways to be used, it can be abused by some to negative effect also.

The company I work for also had a patent troll, who got settled by much bigger companies in the trolls favor.

They found a previous concept that would invalidate their expensive patent(s).

They tried to settle with 0€. The lawyer of HQ didn't agree and changed it so they had to pay 1 CAD.

Just because they could.

Ps. It was accepted ofc.

If the settlement were 0€, it could have been paid with a zero euro bank note: https://www.banknoteworld.com/zero-euro/

But then they would be settling for at least 1.72€!

A nominal fee is pretty common in contracts, it tends to be more binding than zero costs (because an important part of contract law is that both sides benefit from the contract).

Am I understanding correctly that you (your company) found prior art and chose to settle instead of presenting it in court and killing the patent? Any idea why? Isn't there some law that automatically awards you legal fees in the case of a frivolous lawsuit?

Finding prior art to invalidate a patent doesn't make the plaintiff's lawsuit frivolous, so they probably wouldn't be awarded atty's fees. If the court didn't invalidate the patent, then you are now stuck in a serious litigation where the plaintiff has no reason to settle.

You don't present it "to court" because that might be decided by a jury of unsophisticated people. You file an Inter Partes Review, which goes to the Patent Trial and Appeal Board, and is cheaper (note I didn't say "cheap").

The U.S. doesn't have a "loser pays" model like other countries. You can file for attorney's fees, but the barriers are higher.

It's called an invalidity counterclaim.

??? what are you disputing here? IPRs, or defending against an infringement suit, or what?

Doesn't look like a dispute? I think they were trying to supply you with a phrase that slipped your mind.

the question is the antecedent basis of "it"

You don't need to get an IPR, you just make an invalidity counterclaim. IPRs may or may not be desirable for a number of reasons.

TIL. We're talking about US law, right?

I've never heard the term "invalidity counterclaim" and I was in Google Patent Litigation where suits come in constantly. IPRs were pretty standard. Maybe the lawyers did use it and I just never heard it.

If something was going to trial, then "invalidity" was one of the possible defenses, as was "non-infringement."

Who are you making this claim TO? The court? The PTO?

I can ask the lawyer, if you want and if you can wait a day ( or more) to see the reply.

It happened during a very busy time for me and i wasn't involved, since it was a story that was shared during the weekly "covid update" that shares all the company news.

It could be that they also filed a counter lawsuit to invalidate it.

I think the main point was to defend successfully and not to attack/piss some big trolls off.

$1 is probably a peppercorn payment[1]. A contract for 0€ may well fail to be a valid contract due to a lack of consideration - both sides must offer something of value to the other for a contract to be binding.

It's possible that the rest of the settlement would provide valid consideration, but a nominal payment removes any doubt from the situation.

[1] https://en.wikipedia.org/wiki/Peppercorn_(legal)

a settlement is not a contract

Settlement agreements are contracts. No one would agree (hmm, funny word, right) to a settlement if it wasn't legally binding.

Seems wild to me to assert that a settlement is not a contract. What is the basis for this?

Peppercorn payments don't actually happen in the real world. Consideration is never an issue in actual contract litigation and in this case, settling something in exchange for any other benefit (no countersuit, etc) would suffice as consideration.

I can report that they do actually happen in the real world. I've signed two contracts in the past year that had consideration of $1 written into them (and actually made the $1 payment). Are they necessary? I have no idea, but real lawyers wrote the contracts and apparently thought it was good to have that in there.

Sure, there are plenty of bad attorneys.

There is also a Feynman anecdote about this (wherein he demanded the dollar that they neglected to pay him):

https://www.goodreads.com/quotes/7277192-anyway-smith-told-m...

Clearly those real lawyers were just trying to milk you for their % contingency fee on that $1.

I have a land lease that is literally a peppercorn per year in lease fee.

Literally? You mean you have to buy a bag of peppercorns, and hand over one of them?

If whoever-it-is actually demands their peppercorn, yes.

I offered to come by the leaser's office and hand over enough peppercorns to cover the entire lease period. They declined.

Ugly. So it's just a "protection fee" in a sense. Wouldn't surprise me if that's true.

You just won't find it written down anywhere.

A big company like TI is probably on both sides of these things, all the time, and it all washes out for them. In fact, I think you could divide the "big" companies from the "small" ones -- in this context -- not by revenue -- but by whether or not they are pursuing anyone else on patents.

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