We’ve been having a bit of fun with the eBay v. MercExchange case over at IP Memes, the Technolawyer newsletter that I write with Steve and Doug. A few weeks ago, we posted a tongue-in-cheek look at the case from a patent troll’s perspective. In this week’s edition of Memes, we present the case from an infringer’s point-of-view.
The folks at Technolawyer are kind enough to allow me to reproduce this particular meme below. If you’d like to read the newsletter regularly, head over to Technolawyer to sign up for your free account and select the ‘IP Memes Newsletter’ when configuring your account.
We hope you’re able to laugh as much as we have at these brief interludes of humor. Comments are open…so let me know if you laughed or cried. Enjoy!
eBay, from an infringer’s perspective
The setting is a telephone interview between a beat reporter looking for a few “money quotes” from an infringer following the Supreme Court’s decision in eBay v. MercExchange.
Ring … Ring …
Reporter: C’mon … please pick up, don’t send me into voicemail again …
Infringer: Hello?
Reporter: Ah … hello Mr. Bin. My name is Jones, Cub Jones. I’m with the Times … I’ve left you several messages over the last several weeks. I’d like to ask you a few questions about the recent Supreme Court decision in eBay v. MercExchange. Do you have a few minutes?
Infringer: Oh, yeah. Sure. I did get your messages and have been planning to call you back. Sorry. It’s just been so hectic around here. I’m the Chief Operating Officer of this outfit, and I’ve been a little busier than normal since that decision was announced.
Reporter: Busier? How so?
Infringer: How so? Oh man, if only you knew. I had marathon meetings with the lawyers immediately after the decision was announced. Two days later, I signed off on no less than six (6) memoranda ordering plant retoolings and general ramp-ups in production for projects that were, ummm, on hold.
Reporter: What do you mean by “on hold?”
Infringer: Um … let’s just say that they’re not on hold any more. Do the math, kid.
Reporter: So, eBay comes out, and several projects are “not on hold anymore.” Is my math correct? Can I quote you on that?
Infringer: Yep. 2+2 is 4. And, yes, you can quote me. After all, it’s the law of the land.
Reporter: You seem pretty confident. Seems odd, since eBay doesn’t explicitly give anyone permission to infringe. I don’t get it.
Infringer: They must not teach you journalists the math that they gave us in B school. Here goes … It’s not about permission … it’s about the penalty. Listen up … those six projects … they each had, um, patent issues, let’s say. We didn’t want to retool and ramp-up because the patent holder might have been able to shut us down with a pesky injunction. Infringement wasn’t crystal clear, but the threat of the injunction was scary enough that we didn’t want to invest the cash in new equipment and people only to lose the investment in that product later. Get the math now?
Reporter: I do. Thanks for the lesson. But you could still be found guilty of infringement and have to pay damages, right? Doesn’t that concern you?
Infringer: Ahhh … the math lesson is not complete, grasshopper. Damages we don’t care too much about. We’ve done a risk assessment on the infringement issue for each project. The projects that get a, uh, high score have a hidden royalty priced into the product. We build a war chest, so to speak. When, er, I mean if we’re found guilty of infringement, we just write a check from the chest. No skin off our back. But the shut-down … now that peels skin off of our back. It hurts, bad.
Reporter: How so?
Infringer: Believe me, I’ve had to explain to some of your colleagues about plant shut downs and layoffs, all while ducking questions about executive compensation. That, my friend, is not fun. Like I said … it hurts. Do Not Quote Me on That!
Reporter: Got it. I appreciate your candor. Time for a couple more questions?
Infringer: Sorry, kid. I can’t stand around and teach you business math all day. I’ve got those six projects rolling, and two new ones have surfaced. The lawyers told me they “walked away from the bargaining table” with some patent holder and that “we’ve got the green light” on those projects as well. Not sure what it means yet, other than I’ve got to write two more retooling orders, higher another several hundred people to manufacture the things, and ask the Chief Financial Officer to open another coupla chests.
Reporter: Ok … thanks. I’ll be sure to show you the article before it goes live.
Infringer: Don’t bother, kid. I’m too damn busy. We’re making stuff, here.
Excellent. I know that the meme was meant to expose how arrogant and bullying the infringer could be, but I come away feeling great — the big bad company creates a bunch of new jobs, products, and revenue, and the poor little patent holder gets paid out of the war chest too.
Hell, even the lawyers win! In order for the troll to get money, they’re going to have to sue (not much different than before), and that’s going to end up as BMW money for the attorneys.
Seriously, what’s not to like about the Supreme Court’s decision?
Thanks for the comment Ben.
Actually, we didn’t intend for the meme to be one-sided. It’s packed with a lot of subtlety that was intended to expose the nuances of the case from several sides.
What’s not to like? Consider this part of the meme – When talking about his busy schedule, the infringer said “The lawyers told me they “walked away from the bargaining table” with some patent holder and that “we’ve got the green light” on those projects as well.”
There’s a subtle point in there that patent holders, I think, would point to as the main problem with the eBay case. The bargaining table has shifted. Big time. The threat of an injunction has been dealt a major blow, which will likely translate into less bargaining power for patent holders and more for infringers and other potential licensees. This has likely already reduced the value of many patents, particularly those in certain technology areas.