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Big Stick

We’ve always loved that saying “speak softly and carry a big stick.”  Wetro Lan has met the big stick and, by dismissing its case, dodged a potential legal pummeling in its suit against Kaspersky.

     The Register just published a delicious article about Kaspersky’s “win” against patent plaintiff Wetro Lan (although the case was dismissed Wetro Lan had to pay Kaspersky $5k to agree to dismiss the case).  We’ll be adult about it and not bandy about the term “troll” (see e.g. Judge Lucy Koh’s admonishment here).  But, it seems that Wetro Lan might be just another NPE and we were pleased to see that Kaspersky called Wetro Lan’s bluff and forced Wetro Lan to actually litigate its own case.

     Kaspersky did the world a favor. The “trollish” genre of commercial warfare is particularly hard on small businesses who don’t have the resources to employ a team of patent litigators racking up  billable hours. So, sadly, patent troll victims (large and small) usually pay up so that they can just move on.

     Also, troll victims often lose customers and don’t close pending deals because those potential customers don’t want to deal with the litigation risk to their own companies.   It’s par for the course that a patent troll will determine the identity of the victim’s customers and, once the complaint is filed, send those customers a scary letter. And once that happens, as far as customers are concerned, it’s as if the defendant company has the bubonic plague.

      What is really Kafka-esque, however, is that many trollish plaintiffs do not have have the intention or desire to actually litigate their complaint to a final decision. For one, a forward moving case puts the continued validity of the troll’s patent(s) at risk. So, in some cases the plaintiff drags out the litigation by putting off key dates in the court’s scheduling order. That way, they put off the patent validity determination while still having the ability to use the pending litigation to scare off the victim’s potential customers. This puts further pressure on the victim to settle with the troll.

    In June 2015, Daniel Nazer of Electronic Frontier Foundation wrote a great article (entitled Stupid Patent of the Month…”) setting out key aspects of Wetro Lan’s U.S. patent at issue (U.S. Patent No. 6,795,918). Even for the non-nerdy among us, it’s a great read. In discussing the ‘918 patent (which allegedly covers firewalls broadly), Daniel says:

The patent also hedges its bets by claiming a system that is “substantially free from user adjustment,” whatever that means. Even if that was a new idea in 2000, this is not actually a technological improvement. It’s kind of like putting a padlock on the front hood of a car and then saying you’ve invented a new kind of car.

As Daniel notes in his article, Wetro Lan’s business model is, sadly, not uncommon and thus fee-shifting becomes all the more important.  A while back, we wrote about fee-shifting in the O2Micro/Monolithic Power Systems case (posts are here and here) and the Octane Fitness/Icon Health case (post is here).

Although, Wetro Lan’s case was dismissed before a decision (and thus fee-shifting in its true sense did not come into play), we’re very pleased that Kaspersky managed to win at least something towards its legal fees.