There are few people more disliked in the world of gadgets and computer software than the patent troll: an individual (or company) whose sole purpose is to obtain patents from investors and companies who don’t realise the true potential of their invention — and then sue large, wealthy companies for patent infringement.
So far, due in part to the nature of the automotive industry, patent trolling hasn’t been the major issue it has been for silicon valley startups and big-name development powerhouses alike. But as 9to5Mac explained yesterday, Intellectual Capital Consulting changed that this summer when it filed a massive lawsuit against a large number of automotive and software companies — including Apple, Samsung and pretty much all of the automotive industry — over a patent it claims governs the use of a smartwatch to control a vehicle.
Unless the defendants pay around $2 million per year in licensing fees, the claimant asserts, their patent is being infringed and due process will be followed in the courts.
The patent in question was filed in 2003 and issued in 2006, and describes what Intellectual Capital Consulting says is the functionality offered today by many different smartwatch apps designed to allow control of an electric car remotely. Here’s what the actual text of the patent says in its concatenated form.
A remote watch design for a car security system, comprising of a display screen and base with keypad. A user of the remote watch will not only be able to keep track of the time but also will be able to arm/lock, disarm/unlock and remotely start their vehicle by pushing specific buttons on the watch. It is common for people to lose or misplace their keys along with the keyless remote that is attached to the keys.
Having glanced over the patent ourself (and we’re no experts) we’d have to say that the general scope of the vehicle is focused more on vehicular security than extended monitoring of vehicular state of charge, setting the climate control or programing the satellite navigation. Additionally, the patent’s original inventors described a system of control whereby buttons or keypads on the watch would be used to arm or disarm a vehicle security system, start the engine, or trigger a panic alarm.
More importantly, we note that the patent describes the use of a transmitter embedded into the watch which interfaces with the car directly, a point which could save the claimants from a seriously large legal bill. In modern smartwatch apps that communicate with a car, communication is done via several different intermediary stages, including a data connection to the owner’s mobile telephone and then to a cloud-based data centre. The command, once verified by that data centre, is then sent to the car via a mobile LTE or 3G modem embedded in the car.
Putting aside our layperson’s interpretation of this particular patent however, Intellectual Capital Consulting is causing something of a headache for the companies it has embroiled in this particularly nasty patent troll battle. Alongside the larger companies listed, one of the smaller defendants is Allen Wong, developer behind the highly popular Radio Police Scanner app, Regio Apps, and an Apple Watch app that lets you duplicate the functionality of Tesla’s official iPhone app using just your voice.
While the case was filed originally on June 1, it wasn’t until Wong recently began to detail his troubles on the Tesla Motors Club forum that anyone outside the involved companies was even aware of the case.
Wong announced the legal action a few days ago, when he apologized on the popular forum that the impending legal action was preventing him from offering further updates to his popular app until the case had been resolved. While the overwhelming support from forum participants means Wong won’t have to worry about lost revenue or upset customers, perhaps the worst bit of news comes courtesy of where the legal action has been filed: the state of Texas.
Intellectual Capital Consulting is actually based hundreds of miles north of Texas in Denver, Colorado, but the Texas Eastern District Court, where the action has been filed, is a popular haunt of patent trolls. That’s because of all of the states in the Union, Texas is the most favourable to this kind of legal challenge.
As Wong himself explained, the education of the jurors in that small East Texas town means that patent trolls get the upper hand.
“Only 20 percent of them have a college degree,” he said. “Most will not understand what’s going on in the trail. And that’s why patent trolls love that courthouse, because they rule in favor of them around 78-88 percent of the time versus the national average of around 59-68 percent. Not only that, [but] the judges tend to pass out huge rewards in the hundreds of millions of dollars.”
While Wong has done fairly well for himself as a consequence of his coding prowess — and has an impressive garage of supercars and a Tesla Model S to prove it — he notes that he “doesn’t have that kind of money.”
“Even just hiring a lawyer for consultation is wiping out the revenue that Remote S generated,” he complained. As for writing to the judge to try and get the case dismissed? That will cost him an estimated $15,000-$20,000.
For now, Wong and the rest of the defendants, including Apple, Samsung, Hyundai, BMW, Audi, Volkswagen et all, will have to continue fighting this case in the courts. Until then. we’ll keep an eager eye on this one to see if any other smartwatch app developers become embroiled in this nasty case of patent trolling at its worst.
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