Crowdsourcing Firm Puts $20k Bounty On App Patents

An American commercial patent research company says it plans to seek out “prior art” to invalidate a patent being used by MacroSolve to sue Apple (NSDQ: AAPL), Android and BlackBerry app developers, and has invited developers to join in the search, the Guardian can reveal.
Anyone who discovers earlier information that leads to the patent’s withdrawal could win between $5,000 and $20,000 from Article One Partners, which is leading the search.
MacroSolve is one of two companies known to be suing app developers at present; the other, Lodsys, filed a number of lawsuits earlier this week against a number of Apple developers and one Android developer over the technology for in-app purchases.
MacroSolve, which holds a patent relating to collection and transmission of data for online questionnaires, filed suit against 10 companies in April.
Article One Partners, based in New York, uses crowdsourcing techniques and pays rewards of thousands of dollars to people who can uncover “prior art” – demonstrating that the methods claimed in a patent have actually been used before.
Such examples invalidate a patent and therefore make any lawsuits, and payments related to the patents, null and void. It counts Microsoft (NSDQ: MSFT) among its clients, and has recently begun an invalidation search against Interval (NSDQ: IILG) Licensing, which is claiming infringement by Microsoft, Apple and Google.
“We believe the Article One model benefits more than just the clients. This study is a prime example of how different parties – application developers and the general public – can participate in solving a potentially costly problem that impacts the burgeoning mobile app marketplace,” said Cheryl Milone, chief executive of Article One Partners, in a statement to the Guardian.
Patent threats against smartphone app developers have emerged as a serious threat to the burgeoning ecosystem, because many are small businesses which do not have the finances or time to contest a patent claim, and could be put out of business by large demands for licencing fees from patent holders.
Invalidating such patents, or threatening to do so, may turn out to be app developers’ most useful weapon if more examples of patent threats emerge against them. Striking out patents would destroy the revenue model of so-called “patent trolls” who own patents and wait for companies to emerge which apparently infringe their technology and demand a licence fee.
A separate analysis by M?¢Cam, an asset management firm, suggests that MacroSolve’s patent may not be as broad as the company is claiming in its lawsuits, because other patents filed in 1997 and 1998 appear to overlap it. One of those was filed by Jeff Hawkins, inventor of the Palm (NYSE: HPQ) Pilot, while at 3Com. M?¢Cam also lists more than a dozen other patents, many held by IBM, which precede MacroSolve’s and would significantly narrow its applicaability.
M?¢Cam’s analysis of Lodsys’s patent, meanwhile, suggests that there are patents dating back more than a decade, and so still in force, which could either invalidate it or limit its validity to app developers. It also identifies 18 patents filed over the past 20 years by organisations as diverse as the US government and AT&T (NYSE: T) that could constitute prior art.
Article One distributes its challenges to more than 1 million people worldwide to research the validity of patents, and says that it had awarded $1.36m to people who have helped in its prior art searches since it set up in 2008.
In December it launched another “invalidation” crowdsourcing attempt against NTP, a company which successfully sued BlackBerry maker RIM (NSDQ: RIMM) and gained a $612m settlement in 2006. Since then it has filed suit against 13 other companies, including Apple, Microsoft, Google (NSDQ: GOOG), Yahoo (NSDQ: YHOO), AT&T, Motorola (NYSE: MMI) and Palm.
MacroSolve – based in Montreal, Canada – holds three US patents gained in 2003.
Article One Partners did not say on whose behalf, if anyone’s, the prior art search is being carried out.
Prior art does not have to be a pre-existing patent claim; it is sufficient under US and European law for the methods that the patent represents to have been published anywhere in the world and in any language, including newspaper reports, textbooks, or public documents.
People who are considering filing patents are always warned not to document them publicly before filing for them because of the potential for invalidation in future; even a conference report can be sufficient for a challenge.
However, the US Patent Office has had serious challenges simply processing the number of patent filings submitted in the past 20 years, and is known not to be exhaustive in its search for prior art.
That leaves space for companies such as Article One Partners to find evidence that can shoot down patents and save companies facing lawsuits significant amounts.
?¢ People who want to join the search can register at Article One’s site, and view its patent study online.

This article originally appeared in MediaGuardian.