No Patience about Patents: 'Biggest' IP Issue by 2014

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Patent wars will trigger “the biggest debate two from now” in the intellectual property arena, says Christine Varney, the former Assistant Attorney General for Antitrust and Federal Trade Commissioner.

She puts patent battles into the same contentious category as piracy and privacy, and bluntly declared “Patent wars are coming,” during her keynote address at the annual “State of the Net” conference, run by the Congressional Internet Caucus.

Varney’s views on looming patent battles weigh heavily on the cable and communications industries, which are living through high-profile and expensive patent cases — with the likelihood of more to come. The much-anticipated Apple TV project is expected to have network digital video recording capabilities, according to Apple patents that recently surfaced. New Comcast patents for program recommendation engines and interactive overlays, including personalized suggestions, are being field tested.

While these specific patents may not be challenged, cable companies’ recent record of intellectual property litigation augurs a combative environment living up to Varney’s expectations. Tivo continues to sue companies that allegedly infringe its DVR patents; it has beat Dish and AT&T and has a lawsuit pending against Verizon. In an International Trade Commission ruling, Cablevision Systems prevailed against a Verizon assault regarding its use of Cisco set-top boxes for interactive TV programming. In a series of summer and autumn rulings, a federal court found that Verizon violated ActiveVideo Network patents for video-on-demand and remote control access.

Amongst suppliers of interactive services infrastructure, Invidi Technologies Corp. is accusing Visible World and Cablevision of infringing on its patents for advanced advertising technologies.

The complexity and nuances of digital technologies — and their broad deployment — promise to keep the patent issue prominent, and to feed lawyer’s coffers.

Hence Varney’s comments take on great significance. Varney, now a partner in the Cravath Swaine & Moore law firm’s antitrust practice, stressed the privacy and piracy issues - timely amidst this month’s brouhaha about SOPA and PIPA (the now-stalled Stop Online Piracy Act and Protect Intellectual Property Act). But she waxed most emphatically on the patent issue.

She cited the complications of patents “in the global [landscape] where commerce knows no bounds.” Varney also insisted that patents will be “particularly problematic” and predicted that lawsuits will be used both offensively and defensively. Cautioning that “it will be very hard” for some cases, given the potential differing viewpoints “of the U.S. Congress and World International Property Organization in a world without borders.”

Varney expects that companies will aggregate patent rights, and she wondered aloud if such accumulation itself “becomes a market.” She cited recent activities in the pharmacology industry as a model for what may happen in the information technology and communications sectors.

With the clamor for “innovation” and the avalanche of “me-too” products and services, operators and technology suppliers better be ready to lawyer-up for an era of prolonged patent battles.

Gary Arlen is president of Arlen Communications LLC in Bethesda, Md., and a long-time interactive TV enthusiast. Reach him at GArlen@ArlenCom.com

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