Sun’s Art of Patent War

I am no expert in Sun Tzu’s The Art of War but I find Chapter 5 (English and Chinese versions) interesting. For example (emphasis added),

• 5. In all fighting, the direct method may be used for joining battle, but indirect methods will be needed in order to secure victory.
• 6. Indirect tactics, efficiently applied, are inexhaustible as Heaven and Earth, unending as the flow of rivers and streams; like the sun and moon, they end but to begin anew; like the four seasons, they pass away to return once more.

As Sun Microsystems‘ General Counsel, my blog friend Mike Dillon’s (here is my interview with Mike) latest blog entry “The Patent Arms Race” lays out some of Sun’s latest thinking in IP and patent strategy which I find fascinating and very sensible.

Following is an excerpt from Mike’s “The Patent Arms Race” (emphasis added),

To some degree, this topic has a very Cold War feel to it with companies growing patent stockpiles to use if attacked or as a form of “mutual deterrence”. But, at some point, a company needs to ask how many patents it really needs. And, that’s exactly what we did about three years ago. Up to that time Sun was filing well over 1,000 patent applications per year. But, in 2005, we made the decision to reduce our patent filings to the point that we had about 700 patents issued last year.

I love Mike’s and Jonathan’s frankness and desire to keep Sun as transparent as they can. I hope more companies will follow Sun’s examples.

P.S. Check out some of these links Mike provided in his article,

• IBM hopes to patent ‘dealing with chaos’
• a Live IP auction at IP Business Congress (June 25/26, 2008) - highly recommended - check out some of the 65 lots of IP assets. Wow.
• reconsidering patentability of business methods

Links: 2008-03-25

1. Patent Troll Tracker & Cisco's New Blog Policy
2. Courts Resist Using the Term Patent Troll
3. The Complexities Behind JPMorgan’s $10 Bear Offer
4. Is JPMorgan Getting Too Clever?
5. JPMorgan and Bear Test the Limits
6. Bear-JPM: Legal News and Views
7. Judges Released in Pakistan, Chinese Land-Rights Activist Jailed
8. Anti-CNN and the Tibet information war
   

Links: 2008-03-07

1. What Are the Lessons of the Blu-Ray/HD-DVD Battle?
2. A challenge from the New York Times?
3. Patent Office Will Now Require Biological Deposits Before Publication
4. The Best Defense is a Breast Defense - Too funny to ignore (smile)
5. News of two Canadian companies got picked up and some entrepreneurial insights
6. $100,000 for your thoughts - Bill Gates foundation seeking ‘unorthodox’ health ideas - interesting way to start 60 projects that can lead to ideas to prevent HIV infection or help protect against infectious diseases

Links: 2008-02-29 Conservatives bribe, End Software Patents, Avi on Al-Jazeera, Waterproof camcorder ad

1. Conservatives made million-dollar offer to MP Cadman - it is a criminal offense if a bribe was indeed offered.
2. Cadman 'bribe' furor grips Tories
3. Cadman's daughter backs up mom's bribe story - Conservatives have lots of explaining to do as this I just can't see any reason why the honourable Cadman family would tell lies like these
4. "End Software Patents" Launches With Website and Report
5. Joff Wild Responds to "End Software Patents"
   
6. Former CBC-TV host Avi Lewis begins hosting U.S. show on Al-Jazeera network (with YouTube of show)
7. Sanyo Waterproof Video Camera

Chinese Patent Law - Obviousness and Case Selection Bias

I really appreciate researcher like Santa Clara University Law student Xin Ma posting research about Obviousness under Chinese Patent Law for people to read. Understanding Chinese Patent Law is important once the more important challenge of “rule of law” is resolved. (see next paragraph)

Although some people, like patent attorney Mark Walters, consider that “Enforcing IP Rights in China: It’s Not as Hard as You Think“, I still have strong reservation and doubt if the judges in China can consistently withstand potential pressure from the Chinese government. After all, it is naive to think the judges in China have “independence” in any remote way like their counter parts in countries that have a tradition of respecting the “rule of law” backed by a government accountable to the public in a democratic manner.

Quoting the China section of the “Thomson Scientific 2008 Patent Focus Report” (PDF file, emphasis added) [hat tip: Peter Zura for the link]

During 2006, there were more patent cases filed in China than in any other country, and while 98 per cent of these involved only Chinese companies, in the two per cent featuring a plaintiff from outside the country, the foreign entity ended up victorious 90 per cent of the time.

What the report author and the above bloggers, Mark and Peter, failed to pointed out was the existence of “Case Selection” bias. In a sense, foreigners only pick the best of the best cases to litigate so no wonder they appear to win more. If foreigners (especially small businesses/inventors) go into to China to litigate their patent cases and expect the above win rate, they may face with some unpleasant surprise.

Note: The idea of “Case Selection” bias is not my own as I learned of this insightful idea from two Cornell law professors during a previous consulting engagement for a client. Here is the reference for those that like to read more.

Xenophilia or Xenophobia in American Courts? Before and After 9/11
by Prof. Kevin M. Clermont and Prof. Theodore Eisenberg, Cornell Law School

Links: 2008-02-20 Olay Ad, Review Business Method Patents, Supreme Court, US NBER, Travel Wishes

1. Olay Ad - very creative
2. US Fed. Circuit to Review Business Method Patents - good step
3. Should Canadian Supreme Court Justices get along?
4. A Changing of the Guard at the National Bureau of Economic Research
5. 20 Travel Wishes for 2008

Mike Dillon, General Counsel of Sun Microsystems, at Kempton’s Virtual Cafe

I’ve been a regular reader of Mike Dillon’s blog “The Legal Thing” since it was launched on Aug 9, 2006. Mike, a lawyer with over 20 years experiences and Sun Microsystems‘ General Counsel, has been very generous in sharing his insights and wisdom. It was my great pleasure to chat with Mike about ideas he talked about in his blog and follow up with him on a few topics raised.

You can listen to my audio chat with Mike in mp3 format (or you can download or stream the interview here). The following are the time codes with topics, including links to the related blog entries.

00:00 - 04:54 : Welcome Mike to Kempton’s Virtual Cafe and talking about Reebok Rules and Mike’s experience of being an in-house lawyer. Mike talks about writing his own updated set of rules to include new requirements from acts like SOX.

1. This should be interesting - Mike’s first blog entry. Joining 3,000 of fellow employees at Sun and their CEO to blog. Mike also explained how he got the name of his blog from the “Reebok Rules” (PDF file).
2. Thanks, ACC - This is where Mike first linked to the wonderful “Reebok Rules” for in-house counsel. Now, I think we all have something to learn from these rules even you may not be a lawyer. You may be pleasantly surprised. Reebok Rule #15 is — Do “The Legal Thing” (see page 8 of the PDF file).

04:54 - 07:25 : Not having an office and its impact. And the tools Mike uses (including SunRay and his Treo 680).

1. Where do you work? - A few more benefits are discussed here.

07:25 - 10:54 : The work to simplify contracts at Sun.

1. Mr. Edison’s Lawyer - Check out the cool Sun Grid as well.
2. Contracts with Clarity - Check out the difference between the old contract and the new and simplified one.

10:54 - 17:51 : On patents and patent trolls. And taking internal intellectual property and open sourcing it.

1. The “Tax” On Innovation
2. On Litigation … (AZUL)
3. The NetApp Litigation
4. The NetApp Litigation (Continued)

17:51 - 20:24: About Regulation Fair Disclosure and the ground breaking blog and comment exchange between Chairman Cox and Sun CEO Jonathan.

1. Reg FD - Setting some cool example.
2. Sunlight on a Cloudy Day - Cool, a blog comment from SEC Chairman Cox.
3. Free Virtualization, and Sun’s Q2 Results - Check out the bonus at the end of the “Safe Harbor Statement”. (smile)

20:24 - 24:52 : Building and evaluating leaders. Giving and sharing.

1. Building Leaders
2. Planting seeds during the holidays - Mike talks about teaching his children the idea of giving and sharing.
3. Kiva Update - an update on the “Planting seeds” entry

24:52 - 26:44 : Sun’s Project Blackbox (modular data center). About the Google patent on similar idea.

1. During the next “big one” - has a really cool YouTube video about Sun’s Blackbox (modular data center)

26:44 - 28:51 : About Sun’s diversified workforce and “Day in the Life” videos of employees around the world. I asked Mike to see if Sun will consider posting and sharing these videos which I think are very informative presentation.

1. Working to be unnoticed

28:51 - 33:13 : The issues and benefits of allowing comments in blogs. Other companies’ request of Sun’s help with respect to blogging policies, work environment, and flexible working arrangement.

1. A Nice Decision for Bloggers - good to know it is safe to have comments (at least in California (smile))
2. FYI: Here is my entry and unsuccessful effort to help CBC. “CBC Blogging guidelines“

33:13 - 34:47 : Creating online contents under licenses like Creative Commons.

1. Have a question about licenses - ask your teenager

34:47 - 36:03 : Sun’s involvement in the Peer to Patent project

1. A Different “P2P”

36:03 - End : Mike’s experiences in blogging so far and how will he blogs in the future.

Links: 2008-02-07 - RFID, Patent Troll, Poetic Justice, Myspace platform, Josh Lederberg

1. Ford truck with RFID tool tracker - good and bad (see post & comments)
2. The best offense…is a good defense. - a good piece about Patent Troll
3. Buffett Sees ‘Poetic Justice’ in Banks’ Woes - Love this quote quote: “What has happened is a repricing of risk and an unavailability of what I might call ‘dumb money,’ of which there was plenty around a year ago.“
4. The MySpace Developer Platform
5. We have lost a Giant - Vint Cerf remembers Josh Lederberg

Links: 2008-01-23

1. WordPress.comCreator Raises $29.5M
2. Privacy Commissioner of Canada sent letter expressing concerns regarding possible amendments to the Copyright Act
3. RConversation links for 2008-01-22 - good read about the problem with China
4. How To Bake a gorgeous vegan herb bread - beautiful
5. Apple cripples debugging tool to keep iTunes DRM safe - Very sad and misguided
6. US Supreme Court Dive back into Patent Waters
7. He’s Money - Royal Bank’s Gordon Nixon - Canada’s Outstanding CEO of the Year