Patent lawyer offers advice to Lodsys targets

Intellectual property expert and patent attorney Patrick T Igoe has some sage advice for anyone facing an accusation of patent infringement from IP-holding outfit Lodsys.

The company has been firing letters off to iOS and Android developers saying they were infringing patents it had acquired from inventor Dan Abelow.

The company is demanding 0.575 per cent of any revenue generated by apps allegedly using the patented technologies, which some have erroneously suggested relate to in-app purchases. Lodsys disputes Apple's assertion that its third-party developers are covered by its own licensing agreement with the company.

Writing for Groklaw, Igoe's primary advice is, of course, to speak to a lawyer on the matter, but says being in possession of all of the facts before engaging counsel is probably a good idea.

He also says that developers should ignore the ill-informed witterings of the blogosphere and read the relevant patents instead.

"It should go without saying, but do not believe everything you read on the Internet, especially about patent cases," he writes - of course, not referring to thinq_

"It appears, especially with patent coverage, that the desire to post quickly or mold the story to fit an agenda often trump factual analysis."

Igoe maintains that most of the coverage over recent weeks has been at best misleading and at worst dangerously flawed.

He also suggests that Lodsys' money making model relies on ill-informed developers coming to the conclusion that paying a relatively small percentage of their income to Lodsys will be easier and cheaper than taking the case to court.

Igoe doesn't say it out loud, but it sounds to us like the kind of speculative invoicing scam perpetrated by the likes of ACS:Law, the scabrous UK law firm forced into closing by its own incompetence after its evidence-light copyright infringement cases collapsed under the scantest legal scrutiny.

"The success of a Lodsys-like business model, collecting small amounts from a large number of companies based on questionable claims of infringement, requires a low transaction cost for each collection. Targets that roll over without a fight, even when they are not infringing, keep transaction costs low and enable the business model," writes Igoe.

With Apple stepping into the ring to defend developers, Lodsys is unlikely to come out on top, but the last thing people should do is roll over, say Igoe.

"If transaction costs rise through legitimate defenses or declaratory judgment actions, the business model is strained. Lodsys needs developers to think it is cheaper to settle than it is to fight," he writes. "Developers should consider, however, whether filing a declaratory judgment action in their own district might have the possibility of creating a less costly and more satisfying resolution.

"With a declaratory judgment action, it is Lodsys that is faced with a dilemma. For a small or medium-sized target, it may be more economically sensible for Lodsys to drop the demand for the small licensing fee even if they somehow feel they could win. It may be especially compelling if major weaknesses are identified in the infringement case, as I believe they could be here."

For a deeper analysis of the case, and links to loads of pertinent information, head on over to IgoeIP.

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