Is The US Navy Using Patents To Shake Down Companies?

from the something-doesn't-seem-right-here dept

The latest example of how problematic our patent system has become, involves a series of patent infringement lawsuits against a bunch of banks based on a patent that is the property of the US Navy. It turns out that the Navy licensed the patent out to a small company in exchange for 30% of any profits from any patent licensing or litigation. It certainly looks like the Navy is encouraging questionable patent lawsuits. The Navy gets a patent for security authentication, using taxpayer money, and then hands it off to a small company to sue a bunch of banks and generate more revenue for itself. That doesn't seem right. It certainly doesn't help promote the progress of science or the useful arts. The story gets even more ridiculous when you compare it to a story we had a few years ago where an unnamed government agency (possibly the Navy) used a "states secret" claim to avoid having to license a patent. So, basically, the government can use whatever patents it wants without licensing them, but when it comes to its own tax-payer-funded patents, it hands them off to companies to sue others on its behalf. I'm sure that's exactly what Thomas Jefferson pictured when he worked out the details of our original patent system.
Hide this

Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.

Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.

While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.

–The Techdirt Team

Filed Under: patents, us navy


Reader Comments

Subscribe: RSS

View by: Thread


  • identicon
    Anonymous Coward, 16 Jan 2008 @ 1:38pm

    I hanker for a bunch a bunch of cheese!

    reply to this | link to this | view in chronology ]

  • identicon
    Awkward Coward, 16 Jan 2008 @ 1:44pm

    Generate revenues?

    I'm less concerned about the Navy taking in monies from the licensing of patents as I am about "some small company" reaping 70% of the monies off that patent.

    Who chose the company and on what criteria?
    What are the complete terms of agreement between this government agency and this private company?

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 16 Jan 2008 @ 1:44pm

    as long as all the proceeds go to fund the school system, I'm fine with it :)

    reply to this | link to this | view in chronology ]

    • identicon
      Thomas, 16 Jan 2008 @ 2:22pm

      Re: Schools?

      I am trying to figure out why settlement funds generated by patent infringement litigation should benefit anyone but the Navy or it's parnet organization, the Department of Defence? But I must be stupid.

      reply to this | link to this | view in chronology ]

  • identicon
    Danny, 16 Jan 2008 @ 1:53pm

    the government can't own a patent, can it?

    State secrets aside (a completely different can of worms), I don't see how the Navy can hold a patent.

    I've done software development work under DARPA grants before (as probably several readers of this blog). Everything we created that was turned over to the government was in the public domain. (Other games are played where one tries to write the contract to permit the developer to retain rights to software - but that is a third can of worms.)

    How can the Navy get a patent???

    reply to this | link to this | view in chronology ]

  • identicon
    George, 16 Jan 2008 @ 1:58pm

    How?

    State secrets! Need to know!

    reply to this | link to this | view in chronology ]

  • identicon
    dorpus, 16 Jan 2008 @ 2:13pm

    Make a blog, Techdirt will believe anything

    Techdirt has a long history of linking to activist blogs or scammy "science" sites and calling it news.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 16 Jan 2008 @ 2:50pm

    Military Trolls

    Cue military trolls in 3, 2,...

    reply to this | link to this | view in chronology ]

  • identicon
    I. Got some insight into this..., 16 Jan 2008 @ 4:43pm

    How the Navy gets a patent

    The Federal Government (Defense Department, EPA, etc.) employees scientists and engineers that work in the Service or Agency R&D laboratories. These federal employees create technologies that are then patented, which the Federal agency the employee works for own the rights.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 16 Jan 2008 @ 4:52pm

    I'm with Poster #2. Who the hell is the small company that is actually doing the litigation? They get to pocket 70% of all the money from litigation about infringement on a patent they DONT EVEN OWN.

    This is flat out bullshit. At the MOST the US Navy should be able to 'go after' the companies not paying the license fee to use the patent (don't like that either, but it's what should be allowed in the current system).

    This is like me renting some construction equipment, it getting stolen, and then ME claiming my 40,000 dollar tractor was stolen. It's fraudulent!

    Personally, I don't see how the Navy or any other arm of the government can own patents. To me, if something is invented by the US Navy, it should be available for all US Citizens to use without having to pay some asinine fee. The point to the government is to "provide for the good and welfare of the people" and I don't see how this kind of thing is helping me.

    reply to this | link to this | view in chronology ]

  • identicon
    whiner, 16 Jan 2008 @ 5:04pm

    often these patents are generated by the small company doing the work under a contract for which the navy gets ownership of the patent. so the small company that the gov't "hands" the patent to is the company that often developed the technology in the first place . . . it just didn't get the "ownership" of the patent because taxpayer dollars funded the Navy's or DoD's investment.

    by the way to #4 - a patent *is* public domain. public domain just refers to the publishing, but doesn't give the public the right to compete w/ the owner of the patent

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 16 Jan 2008 @ 8:45pm

      Re:

      so the small company that the gov't "hands" the patent to is the company that often developed the technology in the first place

      That's your assertion, but do you have any evidence? And even if it were true, why should a company that was already paid for a product be given back the product it provided? Talk about a sweetheart deal.

      it just didn't get the "ownership" of the patent because taxpayer dollars funded the Navy's or DoD's investment.

      And it shouldn't. Or the benefits of ownership. Those should go to the taxpayers who paid for it.

      I figured some covert military "communications officers" might show up to defend this practice. Are you one?

      reply to this | link to this | view in chronology ]

  • identicon
    Village Peeps, 16 Jan 2008 @ 5:49pm

    Heh

    In the navy
    Yes, you can sail the seven seas
    In the navy
    Yes, you can put your mind at ease
    In the navy
    You can shake down da banker
    In the navy
    You end up lookin like a wanker
    In the navy

    reply to this | link to this | view in chronology ]

  • identicon
    Lee, 16 Jan 2008 @ 8:17pm

    I work at a Navy R&D lab. The proceeds from ideas that we patent are used to help fund further research - thus saving the tax payers money. First we save money or lives by inventing a better solution, then we enable industry to commercialize the solution (feeding the economy), then we use a portion of that money to pay for more research to invent more stuff that saves lives and money. Your complaint is?

    reply to this | link to this | view in chronology ]

  • identicon
    Joe, 17 Jan 2008 @ 2:21pm

    Hold up with my tax dollars!

    If they paid for R&D with my dollars then I am an investor and owed money back for any licensing!

    reply to this | link to this | view in chronology ]

  • identicon
    Clueby4, 17 Jan 2008 @ 2:58pm

    Don't you knees hurt !?!

    Government agencies/ employees don't get copyright protection. (well state gov is fuzzy but only if your ethics are). So why should they get patent protection.

    Government exist only thru the public's sufferance, claims of "saving money" or even more dubious claims of "saving lives" is just pathetic rationalizations for the abuse of the publics trust. I'd hate to see the state of the knees of people who find this scam acceptable.

    reply to this | link to this | view in chronology ]


Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here



Subscribe to the Techdirt Daily newsletter




Comment Options:

  • Use markdown. Use plain text.
  • Remember name/email/url (set a cookie)

Close

Add A Reply

Have a Techdirt Account? Sign in now. Want one? Register here



Subscribe to the Techdirt Daily newsletter




Comment Options:

  • Use markdown. Use plain text.
  • Remember name/email/url (set a cookie)

Follow Techdirt
Special Affiliate Offer

Advertisement
Report this ad  |  Hide Techdirt ads
Essential Reading
Techdirt Deals
Report this ad  |  Hide Techdirt ads
Techdirt Insider Chat
Advertisement
Report this ad  |  Hide Techdirt ads
Recent Stories
Advertisement
Report this ad  |  Hide Techdirt ads
.

This site, like most other sites on the web, uses cookies. For more information, see our privacy policy. Got it
Close

Email This

This feature is only available to registered users. Register or sign in to use it.