Hacker News Reader

Comment by jamra | Hacker News Reader

Each glaring victory in these patent battles are only eclipsed by the crushing defeats of losing a patent lawsuit.

New Egg losing one case and potentially having to pay out millions is devastating.

What do you do as a startup if one of these companies targets you? What do you do as a company that's been around for a while? Amazon pays out. You would have to as well. What if you can't pay? America will lose its foothold as the place for software companies to be grown and nurtured if parasitic behavior isn't removed from the tool belt of its own corporatations.

View on HN

Let's wait for the appeal before we declare any crushing defeats, but you aren't wrong that software patents are killing innovation.

I think if you're a startup and you don't plan to do VC funding, don't incorporate in the US. I guess the US courts could enforce an injunction against your company if you sell to their citizens, though.

If you do business inside the US then incorporating outside of it will not protect you.

Ultimately, the only way to avoid these lawsuits in the US is to not do business in the US.

Would the US actually be able to enforce a court decision beyond injunction against a foreign business located abroad?

France and Germany do it all the time against Google/MS.

Google and Microsoft have local offices and funds in France and Germany. That makes them soft targets.

A troll is unlikely to go to the effort to chase a foreign company with no local presence. They'd probably have to go after your customers one by one if they could find some way to even identify them.

Which is true, but then most international corporations, in other words the ones with money, tend to have local offices in country's with big markets.

But, you have to think long term, you sue the company with no local presence. If the court goes along with it and you win then that company will have problems waiting for it if an attempt is ever made to incorporate within the country.

Doubtful, unless there is some sort of agreement with the host country. But that wouldn't necessarily stop the troll because if that company ever wanted to expand into the US, which is still a big market, then they'll have to deal with the troll sooner or later.

I would abandon the US market until I had the funding to fight trolls or they get responsible legislation going. Once foreign corp. X have got the funding I don't know what would stop a mysterious new US corp. Z from buying access to the X userbase and APIs with the express purpose of doing the exact same thing as X but domestically. And then, once the patent business has been cleared up, merge them. It might have to be as convoluted as X -> unsullied foreign corp. Y -> Z to launder the relationship but I bet it's possible.

New Egg losing one case and potentially having to pay out millions is devastating.

Worse than that, winning a patent lawsuit costs NewEgg about a million dollars. There is no loser-pays rule in the USA and you have to fight your case in both district court (probably the inconvenient and biased East Texas district) and appeals court in DC. Losing costs that million dollars and whatever penalty and fine they are assessed.

What do you do as a startup if one of these companies targets you?

If they want cash, you pay it. If they want you out of business so that they can have the field to themselves, you either quit or sell out to a larger company that can fight.

Reply on news.ycombinator.com