Patent Law

Catch-22 for TomTom?

By Lawrence B. Ebert, Esq.

A bit of background is helpful here. When the Free Software Foundation drafted version 2 of the GPL, it included a clause saying that if a vendor is forced to place restrictions on downstream redistribution of software covered by the GPL (due to a per-unit patent licensing agreement, for example), that vendor loses the right to distribute the software at all. This clause acts as a kind of mutual defense pact, because it prevents any firm in the free software community from making a separate peace with patent holders. A firm's only options are to either fight to invalidate the patent or stop using the software altogether. This clause of the GPL actually strengthens the hands of free software firms in their negotiations with patent holders. A company like Red Hat can credibly refuse to license patents by saying "we'd love to license your patent, but the GPL won't let us."

This creates a problem for a company like Microsoft that wants to extract licensing revenues from firms distributing GPLed software. Ordinarily, a patent holder sues in the hope that it will be able to get a quick settlement and a nice revenue stream from patent royalties. But the vendor of GPLed software can't settle. And if the patent holder wins the lawsuit, the defendant will be forced to stop distributing the software, depriving the patent holder of an ongoing revenue stream. Either way, the trial will generate a ton of bad publicity for the patent holder.

IPBiz notes: if the patent holder wins, and gets an injunction, it's easier the next time. Check out the early years of the litigations by the Wright Brothers. And, yes, there was bad publicity. But, the lower courts nominally follow the law, even if the Supreme Court follows the election returns.

Tim Lee predicts a patent fight:

Regardless, TomTom is now stuck between a rock and a hard place. The GPL has left the firm with only two options. It must either fight Microsoft's patents to the death (literally) or it must settle with Microsoft and immediately stop distributing GPLed software. Given how deeply-entwined GPLed software apparently is in TomTom's products, that second option may be no option at all. So expect a long and bloody fight in the courts.

One likely result will be to create a serious PR problem for Microsoft. Some people might remember the infamous GIF patent wars of the 1990s. When Unisys tried to collect patent royalties on the GIF format, the Internet community responded by switching in droves to the PNG format. In the process, Unisys earned a ton of bad press and a terrible reputation among computer geeks who care about software freedom. Microsoft risks a similar fate if it pursues this litigation campaign against Linux. And given that Microsoft is in a business where innovation is king, it's probably not a good idea to become a pariah in a community that includes many of the world's most talented software engineers.

Hmmm, what did Tim say about the Eolas patent?

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Also

TomTom denies Microsoft's patent infringement assertions

reminding us that non-infringement can be an alternative defense to invalidity.

Full post as published by IPBiz on March 18, 2009 (boomark / email).