A Modern-Day SOPA Opera: SOPA, OPEN, PIPA Oh My!

Posted: February 10, 2012 by Jeff A. Curran in SOPA
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Listen up, all you internet users (which is basically everybody but my mother, who still views the Internet as the work of the devil, and will quote from the book of Revelation in support of her theory). Three bills you need to be aware of, because they may change the way you view (or more correctly, the way you are allowed to view) the Internet. and from what I’m reading, there are some pretty darned big sites and companies that are ready to either “go dark” in protest (Wikipedia, for example, which is where I do most of my legal research) or lend a big supporting hand to the protests of the current bills being considered (Google is one – who can live a day without Googling something? I mean for cryin’ out loud the Company has made itself into a verb!!). Those bills are:

1. Stop Online Piracy Act (or “SOPA”).

2. Preventing Real Online Threats to Economic Creativity and Theft of Intellectual Property Act (PROTECT IP or PIPA, which is easier but less descriptive. I’ve never seen a bill with a name so long it requires not one but two abbreviations).

3. The Online Protection & ENforcement of Digital Trade Act (or “OPEN” Act – again- what is it with thinking up names for these acts? But I guess “OPAENDTA” doesn’t quite roll off the toungue).

Sounds simple enough, right? I mean, who doesn’t want to stop people from stealing stuff and using the Internet to get away with it? Uh, hold on–not so fast there, scooter. Here’s a quick overview, along with the pretty darned serious problems that exist. The main thought is that there is a serious problem (which there really is) regarding piracy on the Internet. As paraphrased from the OPEN site (http://keepthewebopen.com) the problem can be illustrated like this: downloading a movie from a foreign website is like buying a foreign product, but there really aren’t any trade laws equipped to deal with the online purchases from foreign sites.

The SOPA bill allows the Department of Justice and copyright holders to seek court orders against websites accused of enabling or facilitating copyright infringement. The court order could include barring online advertising networks and payment facilitators from doing business with the allegedly infringing website, barring search engines from linking to such sites, and requiring Internet service providers to block access to such sites. The bill would make unauthorized streaming of copyrighted content a crime, with a maximum penalty of five years in prison for ten such infringements within six months. The bill also gives immunity to Internet services that voluntarily take action against websites dedicated to infringement, while making liable for damages any copyright holder who knowingly misrepresents that a website is dedicated to infringement.

Proponents of SOPA say it protects the intellectual property market and corresponding industry, jobs and revenue, and is necessary to bolster enforcement of copyright laws, especially against foreign websites. Opponents say that it violates the First Amendment, is Internet censorship, and will threaten whistle-blowing and other free speech actions. A number of protest actions have been planned, including boycotts of companies that support the legislation, and major Internet companies “going dark” for a day (coinciding with hearing dates).

PIPA (or ‘PROTECT IP”, or whatever else you want to call it), appears to be SOPA’s twin, but in the Senate.

OPEN is, from what I can glean, a “bipartisan” bill written in response to the harsh criticism SOPA is receiving. (I always tend to squint my eyes when I see the word “bipartisan”).

Even the White House has entered the fray, with a post just a few days ago regarding the subject. Here’s a part of that post:

Any effort to combat online piracy must guard against the risk of online censorship of lawful activity and must not inhibit innovation by our dynamic businesses large and small.

And when the White House says “whoa”, you know there is likely a heckuva lot of pressure (political, economic, you name it) coming down against the proposed Act.

So who’s right? Well, everybody. Is there a lot of intellectual property piracy on the open internet seas? Absolutely. Does it need to be dealt with? No question. Do the SOPA and PIPA bills overreach and create more problems than they purport to solve? Yep. The bills do use the U.S. Court system to create a type of “internet police” as it pertains to copyrighted material. They also greatly increase the work flowing to litigators and litigation firms among other things, driving up (WAY up) the cost of doing business, which will most certainly hurt businesses generally and small businesses especially, because whether they are involved or not, others will be so involved, which will drive up the overall cost of products across the board as the increased cost is passed on to the consumer as much as possible. And how/why is it that the US Courts will be essentially graced with the responsibility of policing the Internet for the entire world?

Now that I’ve lit the fire and started the debate, feel free to discuss amongst yourselves (hey- it isn’t my job to give answers, just point out the questions).

The Patent Laws They Are A-Changin’: A User’s Guide to the America Invents Act

Posted: December 21, 2011 by Paul Rossler in Patents
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On September 16, 2011, President Barack Obama signed the Leahy-Smith America Invents Act into law.  The law is considered by many to be the most sweeping change of U.S. patent law in decades.  This article provides a summary of the changes in the law, many of which are designed to streamline patent examination or prosecution, which currently takes several years to complete, and patent infringement litigation, which has become increasingly contentious and bogged down by allegations of patent invalidity and, in particular, allegations of inequitable conduct when obtaining the patent.  Certain provisions of the new law are already in effect.  Others, such as first-inventor-to-file, will not come into effect until March, 2013.  [Read the full article]

Protecting Your Start-Up’s Intellectual Property without Going Broke

Posted: October 26, 2011 by Paul Rossler in General Intellectual Property Information
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For many companies, intellectual property rights in the form of trade secrets, patents, trade names, trademarks and copyrights are their most valuable assets, but such value exists only because those companies took the necessary steps to protect their rights in the assets.  Intellectual property rights are similar to the rights associated with any other property—e.g. with respect to real property, if a fence is not built around it, others wouldn’t have notice to “keep out” and will unknowingly trespass (and perhaps take up residence) with ease.  Therefore, from Day One, a start-up company needs to think about protecting its technology and technological advantages, its branding and business goodwill, and to prepare a budget for such protection. Depending on the type of intellectual property involved and how much legwork the members of the start-up company are willing to do, the budget can be quite modest relative to the amount of protection obtained.  Some suggested steps follow, many of which require little or no direct, out-of-pocket expense and may provide effective protection of the intellectual property. Read more . . .

Boy, Oh, Boycott (Revisited)

Posted: October 4, 2011 by Paul Rossler in General Intellectual Property Information, Patents
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Paul E. Rossler, GableGotwals

The saga continues.  As we had earlier reported in June 2011, the Iraqi Patent Office had summoned our client’s Iraqi patent counsel to a meeting in which counsel was told that the Office now required patent applicants to sign the “Boycott Declaration with Israel.”  Two things were clear.  First, not signing the Declaration meant abandonment of patent rights.  Second, signing the Declaration ran afoul of U.S. “antiboycott” laws and meant significant fines and possible jail time.  (See Boy, Oh, Boycott for an overview of the Boycott Declaration and a brief review of the U.S. antiboycott laws).  Needless to say, our client refused to sign.

The U.S. State and Commerce Departments intervened on behalf of our client — and on behalf of about 15 or so other “targeted” U.S. companies — but to no avail.  Apparently, a higher power is guiding Iraq’s Ministry of Planning and that power requires the Declaration be signed.  The antiboycott laws haven’t received the same endorsement.

Given all the other issues in Iraq, this particular one is unlikely to receive much attention by U.S. officials or the press.  The first two (of our client’s many) patent applications have now gone abandoned.  More are likely to follow.  Looking on the bright side of things, this could be Iraqi democracy in action.  That said, the U.S. has spent billions of dollars and lost more than 4,000 U.S. service personnel in rebuilding Iraq only to hear the doors of Iraqi commerce slammed shut.  Those closed doors not only damage U.S. companies, they close off economic opportunities to Iraqi citizens and weaken the nation’s economic development.  And here we thought that Iraq’s patent system was supposed to do just the opposite.

Debunking the Grassy Knoll Theory of Business Method Patents

Posted: September 9, 2011 by Paul Rossler in Patents
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It almost goes without saying that credit card fraud was around long before Internet shopping, but Internet shopping has been a boon to fraudsters, helping increase the scope, scale, and (perhaps) ease by which they ply their trade.  Credit card processing companies, which depend a great deal on preventing this type of fraud, not only try to outwit the fraudsters but also one another by coming up with new and better fraud detection schemes or methods.  One of those companies, CyberSource Corporation (“CyberSource”), thought its method of fraud detection was so new and inventive that it applied for, and subsequently received, a patent on it.   However, getting a patent is one thing, enforcing it is another, and whenever a patent holder sues an alleged infringer, the patent is placed at risk of being declared invalid.  This is especially true of patents like the one CyberSource held because it was directed to a “business method.”  What the Federal Circuit Court of Appeals decided about the validity of this patent is instructive about what is, and what is not, patent-eligible subject matter when it comes to business methods. (Read more)

What’s a Poor “Body” to Do? Invention by Embodiment

Posted: August 11, 2011 by Paul Rossler in Patents
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A “bedrock principle of patent law” is that the claims, not the written description, define the patented invention.   That bedrock, which lately has been showing signs of cracking,  might now have a tamperproof retractable syringe permanently lodged in the crack. (Read more)

When Patents Attack!

Posted: July 27, 2011 by Paul Rossler in Patents
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Patent trolls on steroids?  Mafia-style shakedowns?  Attorneys travelling in packs?  Mumble jumble that no one understands?  This week’s episode of This American Life is a fine example of investigative reporting and well worth a listen.  If you can’t set aside a full hour to listen to the entire episode, at least check out one of its parts (Prologue, Act One, Act Two) or read the transcript.

The Debate Over Form Versus Function Continues . . . Trademark-Style

Posted: July 11, 2011 by aliciajedwards in Trademarks
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What do Betty Boop, license plate covers, key chains, and fishing reels have in common?  They all have key features that raise the issue of trademark protection.  Because trademarks are meant to identify the source of goods and services, features of those goods and services that are merely functional are not entitled to protection.  However, the line between function and identification can be blurry and has been the subject of much debate.  This article reviews the general rules for determining functionality and then describes representative cases, including one about Betty Boop which dramatically changed the test for aesthetic functionality.  The article concludes with some considerations for trademark owners. (Read more…)

Down(loaded) and Dyslexic? The Difference between “No” and “On”.

Posted: June 29, 2011 by Paul Rossler in Patents
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What does “disable” mean? That was the $200 million dollar question. After seven years of expensive, time-consuming, contentious patent infringement litigation between TiVo and EchoStar, the Federal Circuit Court of Appeals had to decide whether EchoStar’s redesigned software was “so different” from its already-to-be-found-infringing digital video recorder software that EchoStar should not be held in contempt of a court-ordered permanent injunction. EchoStar’s conduct, and the Court’s decision, has implications for design-around efforts intended to render an infringing device non-infringing. (Read article…)

Boy, Oh, Boycott: Sign, Get Patent, Go to Prison

Posted: June 23, 2011 by Paul Rossler in General Intellectual Property Information
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Paul E. Rossler & Lori L. Sears, GABLEGOTWALS

On June 3, 2011, Secretary of State Hillary Clinton spoke at the State Department’s “Business Forum Promoting Commercial Opportunities in Iraq.” She proclaimed Iraq “open for business,” and urged U.S. companies to invest there. Three days later, one of our clients, who already does business in Iraq and has patents pending there, received a demand from the Iraqi Patent Office. That demand made “open” look like “closed.”

Over the past year or so, there have been sporadic news reports of Islamic hardliners gaining influence in Iraq. There’s apparently some truth to those reports at least as far as the Iraqi Patent Office is concerned. The Office summoned our client’s Iraqi patent counsel to a meeting and told counsel that our client must submit a new power of attorney. Failure to comply would result in the loss of intellectual property rights. Being required to submit a new power of attorney is not, in and of itself, unusual. What made this request (highly) unusual was that the power of attorney included a document titled, “Boycott Declaration with Israel.”

The Boycott Declaration with Israel, which stems from the Arab League’s 60+ year-old official boycott of Israeli companies and Israeli-made goods, asked the following questions of our client:

1. Do you now or ever have had a branch or main company, factory, assembly plant in Israel or have you sold one to Israel?

2. Do you have now or ever have had general agencies or offices in Israel for your Middle Eastern or International operations?

3. Have you ever granted the right of using your name, trademarks, royalty, patents, copyrights, or that of any of your subsidiaries to Israeli persons or firms?

4. Do you participate or own or ever have participated or owned shares in Israeli firm or business?

5. Do you render now or ever have rendered any consultative services or technical assistance to any Israeli firm or business?

6. Do you represent now or ever have represented any Israeli firm or business in Israeli or abroad?

7. What companies in whose capital are you shareholders? Please state the name and nationality of each company and the percentage of share to their total capital?

8. What companies are shareholders in your capital? Please state the name and nationality of each company and the percentage of share to total capital?

The questions are quite shocking. So are the penalties for completing the Declaration, even if the “wrong” answers from the Arab League’s perspective are given.

The U.S. has “antiboycott” laws which are intended to address the exact situation that our client found itself in: being asked to participate in another nation’s economic boycott that the U.S. government does not sanction. Under those laws, a “knowing” violation carries a fine of $50,000 (or five times the value of the exports involved, whichever is greater) and imprisonment of up to five years. Lesser violations can result in fines of up to $11,000 per violation and denial of export privileges. Even receiving a request like the one our client received triggers a duty to report the incident to the Bureau of Industry and Security’s Office of Boycott Compliance.

Our client is not alone. The Office of Boycott Compliance provides a rather long list of illegal boycott compliance requests reported to it by U.S. companies. To see this list, along with additional information about antiboycott compliance, click here.

For more information about the Arab League Boycott of Israel, see Martin A. Weiss, The Arab League Boycott of Israel, Congressional Research Report for Congress, click here (updated Aug. 27, 2008).

We have informed Iraqi patent counsel that our client will not comply with the request and we and our client have reported the incident to the proper U.S. authorities. Secretary Clinton’s Assistant Deputy at the State Department has been quite helpful, as has the U.S. Department of Commerce, which notified the U.S. Ambassador to Iraq. The Ambassador has sent a diplomatic letter to Iraq’s Ministry of Planning, Central Board for Standardization and Quality Control. The letter raises concerns about the Iraqi Patent Office’s demand and requests a meeting to resolve the matter. We remain hopeful that good sense and justice will prevail, but until the issue of the “Boycott Declaration with Israel” is resolved, companies desiring to do business in Iraq need to consider what “open for business” entails.

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