Paypal Patent Application: Expedited Virtual Currency Transaction System(appft.uspto.gov)
appft.uspto.gov
Paypal Patent Application: Expedited Virtual Currency Transaction System
http://appft.uspto.gov/netacgi/nph-Parser?Sect1=PTO2&Sect2=HITOFF&u=/netahtml/PTO/search-adv.html&r=1&p=1&f=G&l=50&d=PG01&S1=20180060860.PGNR.&OS=dn/20180060860&RS=DN/20180060860
79 comments
It sounds like they say 'create 100 accounts with 1 coin in it', then when you want to send, say, 23 coins, you give the recipient the private keys to 23 of those accounts.
Which 1) only works if you trust the sender or 2) immediately transfer the funds out in which case you're still rate limited by the root chain.
Which 1) only works if you trust the sender or 2) immediately transfer the funds out in which case you're still rate limited by the root chain.
> or 2) immediately transfer the funds out in which case you're still rate limited by the root chain.
That's in there.
> 12. The method of claim 11, further comprising: performing, by the first user device, a respective virtual currency transaction using each of the plurality of decrypted third user secondary wallet private keys to transfer the association of predefined amounts of the virtual currency associated with respective third user secondary wallets to the first user primary wallet.
So I'm not sure how this is supposed to "expedite" anything.
That's in there.
> 12. The method of claim 11, further comprising: performing, by the first user device, a respective virtual currency transaction using each of the plurality of decrypted third user secondary wallet private keys to transfer the association of predefined amounts of the virtual currency associated with respective third user secondary wallets to the first user primary wallet.
So I'm not sure how this is supposed to "expedite" anything.
It isn't completely irredeemable in a different context. Such as if the network supported expedited operations for things. Imagine if Ethereum had a built-in or special smart contract that was a wallet contract. It has an owner that is just some address (another contract or desktop wallet). If Ethereum expedited changing ownership (where ownership changes are signed messages of the current owner so there is no trust involved), then the idea works.
Edit: wait, no, that shouldn't be much faster, if at all. Still need to get it in a block and, IIRC, Ethereum is account based so this is basically how transfers already work, just using arithmetic...
Edit: wait, no, that shouldn't be much faster, if at all. Still need to get it in a block and, IIRC, Ethereum is account based so this is basically how transfers already work, just using arithmetic...
AFAIU, Ripple handles escrow without transaction fees for multiple transactions (2016 "SusPay"); and maintains the transaction history within the distributed ledger:
https://ripple.com/build/escrow/
I included links to Bitcoin BIP32 Hierarchical Deterministic Wallets (2012) and a description in another thread here. Is this HD Wallets with different terminology? Are they talking about transferring wallets keys instead of balances? If so, do they update the AML information with the exchange? You should never share your private key(s).
I included links to Bitcoin BIP32 Hierarchical Deterministic Wallets (2012) and a description in another thread here. Is this HD Wallets with different terminology? Are they talking about transferring wallets keys instead of balances? If so, do they update the AML information with the exchange? You should never share your private key(s).
Rather than the abstract, the legality of a patent is based primarily on the claims. That's what you should be looking at to see if there's prior art. Here's claim 1:
1. A virtual currency transaction system, comprising: a non-transitory memory; and one or more hardware processors coupled to the non-transitory memory and configured to read instructions from the non-transitory memory to cause the system to perform operations comprising: identifying a first user primary wallet that is associated with a virtual currency and that includes a first user primary wallet private key; creating a plurality of first user secondary wallets that each include a respective first user secondary wallet private key; performing a respective virtual currency transaction using the first user primary wallet private key to transfer an association of predefined amounts of the virtual currency from the first user primary wallet to each of the plurality of first user secondary wallets such that at least two of the plurality of first user secondary wallets are associated with different predefined amounts of the virtual currency; receiving, subsequent to associating the predefined amounts of the virtual currency with each of the plurality of first user secondary wallets, an instruction to transfer a payment amount to a second user; and allocating a subset of the first user secondary wallet private keys to the second user, wherein the subset of the first user secondary wallet private keys are included in respective first user secondary wallets that are associated with predefined amounts of the virtual currency that equal the payment amount.
1. A virtual currency transaction system, comprising: a non-transitory memory; and one or more hardware processors coupled to the non-transitory memory and configured to read instructions from the non-transitory memory to cause the system to perform operations comprising: identifying a first user primary wallet that is associated with a virtual currency and that includes a first user primary wallet private key; creating a plurality of first user secondary wallets that each include a respective first user secondary wallet private key; performing a respective virtual currency transaction using the first user primary wallet private key to transfer an association of predefined amounts of the virtual currency from the first user primary wallet to each of the plurality of first user secondary wallets such that at least two of the plurality of first user secondary wallets are associated with different predefined amounts of the virtual currency; receiving, subsequent to associating the predefined amounts of the virtual currency with each of the plurality of first user secondary wallets, an instruction to transfer a payment amount to a second user; and allocating a subset of the first user secondary wallet private keys to the second user, wherein the subset of the first user secondary wallet private keys are included in respective first user secondary wallets that are associated with predefined amounts of the virtual currency that equal the payment amount.
Wait, so is the patent literally for just transferring wallets with currency in them?
Boiled down, it appears so.
I only read the claims, however.
I only read the claims, however.
My god, that is one of the most unclear abstracts I've ever read.
what's the point of this when there's clearly prior art[1] by almost a decade? to patent-troll and stifle competition? i doubt it would work for them; it'll only take 1 bitcoin millionaire/billionaire philanthropist (see pineapple fund) to shut them town.
[1] https://bitcoin.org/bitcoin.pdf
[1] https://bitcoin.org/bitcoin.pdf
This isn't a patent of bitcoin. It is an attempt to patent a new transaction scheme. Something similar to block-chain but with different mechanisms. They even mention in the application that virtual currencies already exist as prior art.
To appease shareholders.
I'm surprised it took this long for an innovative digital payments company to think about innovating digital payments.
Has anyone done the math on how much losing ~100% of their Ebay business will cost them?
Ebay was (and is until mid 2020) 13% of Paypal volume https://www.marketwatch.com/story/paypal-just-how-bad-is-the...
it'll cost them the opportunity to support Amazon, Alibaba, and other bigger and better markets than eBay first class moving forward :O
Mh? Why
Why should this be patentable?
This is from 2016 and original authors are no longer at PayPal..
Patents typically take several years to be examined.
Source: mine took 4 years, including various rounds of asking for re-examination.
Source: mine took 4 years, including various rounds of asking for re-examination.
The document is dated March 1, 2018. Originally filed in 2016, yes, but it seems to be current.
Urgh. PayPal is the definition of stagnant. As a merchant, the experience hasn't changed over a decade. I have over a dozen workarounds for their bad interfaces for refunds, invoices, chargebacks, tax reporting, etc, user experiences.
I'm not clear on why they move so slow.
To be fair, across that broad range, nobody else is doing better than them. It just seems like given their position, I'd see more innovation. For example, what’s their response to Stripe? They seem to be on their laurels.
I'm not clear on why they move so slow.
To be fair, across that broad range, nobody else is doing better than them. It just seems like given their position, I'd see more innovation. For example, what’s their response to Stripe? They seem to be on their laurels.
> For example, what’s their response to Stripe?
I know that PayPal is always trashed for various reasons and rightfully so, but one thing the new (or fairly new) players like Stripe haven't gotten right is fraud detection. PayPal still rules when it comes to chargebacks, Merchant protection (if you follow their protocols correctly, eg. don't sell guns, illegal stuff and read their documentation thoroughly which requires you to do some API calls to enable merchant protection) you're pretty much safe. The same isn't the experience with Stripe.
I, as a developer myself find it incredibly easy to put together something with Stripe in just a matter of few hours with Stripe vs PayPal. But, have you ever experienced a fraudulent case with Stripe? Stripe will almost always side with the customer even though you have evidence to prove you were the one scammed. I hope you never have to experience what it is like because you can't even get hold of someone over the phone when that happens.
But, as much as I hate PayPal like you, I can tell you, there were many many incidents where I got stuck with their sh*tty documentation and I was able to get hold of someone from their developer team. There were many instances where I was able to successfully win chargebacks against fraudsters by getting hold of someone on the phone and explaining the situation. Stripe simply isn't there yet, and this is one of the most important elements in this business, not just the fancy integration and documentation.
It's not Stripe's fault though, I opine that they simply don't have enough data as PayPal does to detect/prevent fraud as good as PayPal.
I, as a developer myself find it incredibly easy to put together something with Stripe in just a matter of few hours with Stripe vs PayPal. But, have you ever experienced a fraudulent case with Stripe? Stripe will almost always side with the customer even though you have evidence to prove you were the one scammed. I hope you never have to experience what it is like because you can't even get hold of someone over the phone when that happens.
But, as much as I hate PayPal like you, I can tell you, there were many many incidents where I got stuck with their sh*tty documentation and I was able to get hold of someone from their developer team. There were many instances where I was able to successfully win chargebacks against fraudsters by getting hold of someone on the phone and explaining the situation. Stripe simply isn't there yet, and this is one of the most important elements in this business, not just the fancy integration and documentation.
It's not Stripe's fault though, I opine that they simply don't have enough data as PayPal does to detect/prevent fraud as good as PayPal.
I can confirm that it's very hard to win a dispute if using Stripe as a merchant with a card-not-present transaction. However...my experience has been that's true of all payment processors, including Paypal, and I have heard a lot of horror stories about Paypal in specific.
For example, Paypal's seller protection explicitly does not cover you as a seller if the buyer claims the item was not as described; that leads to the famous brick fraud which has been going on for well over a decade. Eg https://ask.metafilter.com/77638/Can-I-trust-PayPals-seller-... or https://news.ycombinator.com/item?id=13180885.
> Stripe will almost always side with the customer even though you have evidence to prove you were the one scammed. I hope you never have to experience what it is like because you can't even get hold of someone over the phone when that happens.
There are hundreds if not thousands of stories of people having this issue with Paypal, so... :)
For example, Paypal's seller protection explicitly does not cover you as a seller if the buyer claims the item was not as described; that leads to the famous brick fraud which has been going on for well over a decade. Eg https://ask.metafilter.com/77638/Can-I-trust-PayPals-seller-... or https://news.ycombinator.com/item?id=13180885.
> Stripe will almost always side with the customer even though you have evidence to prove you were the one scammed. I hope you never have to experience what it is like because you can't even get hold of someone over the phone when that happens.
There are hundreds if not thousands of stories of people having this issue with Paypal, so... :)
> For example, Paypal's seller protection explicitly does not cover you as a seller if the buyer claims the item was not as described
My experience (I sell Bamboo chairs, ha!) is that if you can prove you have a detailed description of the item in place that specifies what is included, what isn't, what's the color, texture and everything else in sufficient detail, you can win the case. In my case I do all that plus I display my terms and conditions during checkout, so there were maybe 3 times this happened to me and I won all of these cases.
Easiest way to avoid this? Block payments/checkouts from demographics notorious of these practices - China, Pakistan, Africa, Egypt, etc. Your demographics may vary though, based on your product, your target audience, etc. Use your analytics systems to find out which ones give you a lot of high pageviews:bounce ratio and block them, especially if there are suspicious orders from them (10000 orders of a toothbrush without any prior emails, etc for example).
I use my own e-commerce platform (because Shopify sucks) to detect and trigger fraud systems. If something looks like even a 10% suspicious transaction to me, it will be flagged and pass through a manual order fulfilment. I know, I make it sound so easy, but this will probably take you atleast half a year to fine tune and you should be good.
> There are hundreds if not thousands of stories of people having this issue with Paypal, so... :)
Once again, I'm not siding with PayPal, but I think this could be because they've been much longer in the business than Stripe?
My experience (I sell Bamboo chairs, ha!) is that if you can prove you have a detailed description of the item in place that specifies what is included, what isn't, what's the color, texture and everything else in sufficient detail, you can win the case. In my case I do all that plus I display my terms and conditions during checkout, so there were maybe 3 times this happened to me and I won all of these cases.
Easiest way to avoid this? Block payments/checkouts from demographics notorious of these practices - China, Pakistan, Africa, Egypt, etc. Your demographics may vary though, based on your product, your target audience, etc. Use your analytics systems to find out which ones give you a lot of high pageviews:bounce ratio and block them, especially if there are suspicious orders from them (10000 orders of a toothbrush without any prior emails, etc for example).
I use my own e-commerce platform (because Shopify sucks) to detect and trigger fraud systems. If something looks like even a 10% suspicious transaction to me, it will be flagged and pass through a manual order fulfilment. I know, I make it sound so easy, but this will probably take you atleast half a year to fine tune and you should be good.
> There are hundreds if not thousands of stories of people having this issue with Paypal, so... :)
Once again, I'm not siding with PayPal, but I think this could be because they've been much longer in the business than Stripe?
> "Easiest way to avoid this? Block payments/checkouts from demographics notorious of these practices - China, Pakistan, Africa, Egypt, etc."
These types of blocks by country don't seem right. Why no just block by behavior?
These types of blocks by country don't seem right. Why no just block by behavior?
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Sure, but compare Braintree related HN posts to Stripe related HN posts. Something is missing.
Edit: Guess my feel that HN posts might be correlated to innovation is off? As far as I can tell, Stripe is kicking Braintree’s ass. PayPal has good market share as a whole, because it is a second form of payment. Ignore that and look at basic CC payments only, and Stripe is clearly beating Braintree in market share. Basically...what did PayPal net from this acquisition?
Edit: Guess my feel that HN posts might be correlated to innovation is off? As far as I can tell, Stripe is kicking Braintree’s ass. PayPal has good market share as a whole, because it is a second form of payment. Ignore that and look at basic CC payments only, and Stripe is clearly beating Braintree in market share. Basically...what did PayPal net from this acquisition?
I've used Braintree extensively (and have limited experience with Stripe).
Braintree has been an absolute pleasure to develop with. Their support has been excellent, we even had a conference call with their dev team in Australia regarding a new feature that they were rolling out so that we could be an early adopter.
HN gets all giddy and excited about Stripe for some reason, but Braintree is just as nice and easy to use. Stripe doesn't have anything inherently better than BT.
Braintree has been an absolute pleasure to develop with. Their support has been excellent, we even had a conference call with their dev team in Australia regarding a new feature that they were rolling out so that we could be an early adopter.
HN gets all giddy and excited about Stripe for some reason, but Braintree is just as nice and easy to use. Stripe doesn't have anything inherently better than BT.
I built one small web-app that required payment processing. I tried out both Stripe and Braintree and actually wound up going with Braintree. I was really surprised but their documentation for integration in a Ruby on Rails app at that time was a lot more complete.
HN posts are no measure of profitability or market share. Loud does not equal better.
So, how do the two do compare in market share? That is, specifically vs the Braintree product. Is this accurate? https://www.datanyze.com/market-share/payment-processing/bra...
Edit: Get the charge volume point, but 15% of top sites versus less than 1% seems to indicate something. Also, websites added/dropped going negative for Braintree. That can’t be a good thing.
Edit: Get the charge volume point, but 15% of top sites versus less than 1% seems to indicate something. Also, websites added/dropped going negative for Braintree. That can’t be a good thing.
You’d want to measure based on charge volume, not sites using each service.
My understanding is Braintree is cheaper when you get big enough.
Edit: it doesn’t cost you anything to accept Stripe on your site. Would you figure Optimizely revenue from all of its free plan users they just purged? You would not.
My understanding is Braintree is cheaper when you get big enough.
Edit: it doesn’t cost you anything to accept Stripe on your site. Would you figure Optimizely revenue from all of its free plan users they just purged? You would not.
Why charge volume? Seems like since the fees are the same, number of integrations would be a better indicator of ease of use.
Ease of use doesn’t mean profit. Volume and margins do. That's all that matters. Reddit is easy to use and makes zero profit.
Why should they be changing all the time?
Paypal already dominates the market. There's not much they need to do, and there's not much that needs to be done. It's an online payments system, not a game. It doesn't need to be innovative or different just for the sake of it.
I agree that paypal has a number of issues that need to be fixed (high fees for transactions and exchange, little/slow customer support, lack of transparency for many processess, questionable privacy agreements) but these problems have nothing to do with innovation. It would be nice for the near-monopoly to be broken, but it's adequate.
Paypal already dominates the market. There's not much they need to do, and there's not much that needs to be done. It's an online payments system, not a game. It doesn't need to be innovative or different just for the sake of it.
I agree that paypal has a number of issues that need to be fixed (high fees for transactions and exchange, little/slow customer support, lack of transparency for many processess, questionable privacy agreements) but these problems have nothing to do with innovation. It would be nice for the near-monopoly to be broken, but it's adequate.
(2016)
Bitcoin transactions support multiple inputs and multiple outputs (transactions involving multiple input and multiple output "accounts").
For example, Satoshi Nakamoto would need to use multiple accounts as inputs for any single transaction greater than 50 BTC. Those accounts were created prior to the development of the Hierarchical Deterministic Wallet spec (BIP32) [0]. From reading only the abstract cross-posted here, it sounds like the linked patent filling from 2016 is describing something very similar to the "Per-office balances: m/iH" use case described in BIP32 [1]; which is indeed prior art from 2012 [0].
With Bitcoin HD Wallets, there is no distinction between a private key and an account. With an HD Wallet, there is a private parent key and there are private child keys which are derived from the private parent key. Each private child key is a distinct "account". Multiple Bitcoin wallet softwares support the 2012 BIP32 HD Wallet spec.
[0] https://github.com/bitcoin/bips/blob/master/bip-0032.mediawi...
[1] https://github.com/bitcoin/bips/blob/master/bip-0032.mediawi...
For example, Satoshi Nakamoto would need to use multiple accounts as inputs for any single transaction greater than 50 BTC. Those accounts were created prior to the development of the Hierarchical Deterministic Wallet spec (BIP32) [0]. From reading only the abstract cross-posted here, it sounds like the linked patent filling from 2016 is describing something very similar to the "Per-office balances: m/iH" use case described in BIP32 [1]; which is indeed prior art from 2012 [0].
With Bitcoin HD Wallets, there is no distinction between a private key and an account. With an HD Wallet, there is a private parent key and there are private child keys which are derived from the private parent key. Each private child key is a distinct "account". Multiple Bitcoin wallet softwares support the 2012 BIP32 HD Wallet spec.
[0] https://github.com/bitcoin/bips/blob/master/bip-0032.mediawi...
[1] https://github.com/bitcoin/bips/blob/master/bip-0032.mediawi...
You can file paperwork to tell the examiner that you think you have found prior art. Their searches are typically scoped to existing patents.
That would require one to read the patent, which could be used as evidence of willful infringement.
If someone else could read it and file a prior art brief/notification - if appropriate - that'd be helpful.
If someone else could read it and file a prior art brief/notification - if appropriate - that'd be helpful.
I think you're getting into a bit of bush lawyering here.
Saying "oh but your honour, I know of it but I didn't actually read it" won't carry much water if it ever came to trial. If nothing else it would evidence an intent to ... willfully infringe.
Of course, I am not a lawyer, and clearly neither are you. Neither of us is giving legal advice.
Saying "oh but your honour, I know of it but I didn't actually read it" won't carry much water if it ever came to trial. If nothing else it would evidence an intent to ... willfully infringe.
Of course, I am not a lawyer, and clearly neither are you. Neither of us is giving legal advice.
re: "Supreme Court Update: New Standard for Willful Patent Infringement and Enhanced Damages Under 35 U.S.C. §284" (2016 "Halo")
https://www.omm.com/resources/alerts-and-publications/alerts...
> Though the Court’s unanimous opinion gives district courts wider latitude to apply enhanced damages under the abuse-of-discretion standard, a concurrence by Justice Breyer, joined by Justices Kennedy and Alito, suggests at least two judicial limitations to that discretion: (1) mere knowledge of the patent is insufficient to support enhanced damages; and (2) “enhanced damages may not serve to compensate patentees for infringement-related costs or litigation expenses.”
There should be no IP reason to stop using Bitcoin HD Wallets for handling multiple Bitcoin accounts due to the linked patent filing because Bitcoin HD Wallets existed four (4) years prior to what seems to be described in the patent abstract copied to this thread.
> Though the Court’s unanimous opinion gives district courts wider latitude to apply enhanced damages under the abuse-of-discretion standard, a concurrence by Justice Breyer, joined by Justices Kennedy and Alito, suggests at least two judicial limitations to that discretion: (1) mere knowledge of the patent is insufficient to support enhanced damages; and (2) “enhanced damages may not serve to compensate patentees for infringement-related costs or litigation expenses.”
There should be no IP reason to stop using Bitcoin HD Wallets for handling multiple Bitcoin accounts due to the linked patent filing because Bitcoin HD Wallets existed four (4) years prior to what seems to be described in the patent abstract copied to this thread.
Yes, the same link was at the top of my google search too. My conclusions were that (1) it's not cut-and-dried and (2) I am not a patent lawyer and I don't think it's wise to pretend I am.
Sounds like a something the EFF might be interested in.
Sad the US doesn't do anything against patents or at least software patents. I don't think patents do any good in respect to the development of mankind.
I once spent several months reading a certain set of patents. This was sanctioned by the lawyers of the company I was working for then. A few comments:
- Patents are supposed to "teach" things. Yet in every place I've worked, employees are prohibited or at least actively discouraged from reading patents, because of liability concerns. So they fail at teaching because knowledge of what's in a patent is actually dangerous.
- The first month or so of reading those patents was basically about learning a whole new language. The terminology, twisted descriptions and deliberate obfuscation again makes the "teaching" aspect of patents utterly useless. No one in their right mind says, "I'm going to go learn some new stuff, so I'm off to read a bunch of patents." Nobody does that.
Patents don't teach, they're a land grab, and are about as hostile to the actual "Progress of Science and useful Arts" as a sucking chest wound.
- Patents are supposed to "teach" things. Yet in every place I've worked, employees are prohibited or at least actively discouraged from reading patents, because of liability concerns. So they fail at teaching because knowledge of what's in a patent is actually dangerous.
- The first month or so of reading those patents was basically about learning a whole new language. The terminology, twisted descriptions and deliberate obfuscation again makes the "teaching" aspect of patents utterly useless. No one in their right mind says, "I'm going to go learn some new stuff, so I'm off to read a bunch of patents." Nobody does that.
Patents don't teach, they're a land grab, and are about as hostile to the actual "Progress of Science and useful Arts" as a sucking chest wound.
Any additional info on liability concerns?
I had a patent issued last year as sole inventor (software, but a legit invention), and I actually just found a patent doc at a company I'm working with earlier today (they have the patent number in their web app's footer). I was planning to scan through the diagrams.
To me patent text is strange compiled pseudo-legalese, but I have found some learning in the diagrams.
I had a patent issued last year as sole inventor (software, but a legit invention), and I actually just found a patent doc at a company I'm working with earlier today (they have the patent number in their web app's footer). I was planning to scan through the diagrams.
To me patent text is strange compiled pseudo-legalese, but I have found some learning in the diagrams.
Infringe a patent, and the holder of the patent can be awarded damages. We're familiar with that.
Knowingly infringing a patent can bring triple damages.
You can bet that the USPTO granted someone a patent on the linked list, or a common variant of a hash table (don't get me started on how the USPTO determines prior art -- they don't use common literature, they seem to just search the patent database). So if you accidentally read a patent on said linked list / hash table and use it in a product and you're sued for infringement, damages go up quite a bit. That's one reason companies discourage engineers from reading patents.
Back in the 1980s someone had a patent on "Network standard byte order". Didn't matter the order you chose (big or little endian, or inside-out like the PDP-11, or whatever). As long as it was a stable and common byte order used on the network, you infringed. The "inventor" was a friend of a friend, and reportedly he said, when the patent was granted, "I can't believe they gave that to me."
Yeah, patents are utterly busted.
Knowingly infringing a patent can bring triple damages.
You can bet that the USPTO granted someone a patent on the linked list, or a common variant of a hash table (don't get me started on how the USPTO determines prior art -- they don't use common literature, they seem to just search the patent database). So if you accidentally read a patent on said linked list / hash table and use it in a product and you're sued for infringement, damages go up quite a bit. That's one reason companies discourage engineers from reading patents.
Back in the 1980s someone had a patent on "Network standard byte order". Didn't matter the order you chose (big or little endian, or inside-out like the PDP-11, or whatever). As long as it was a stable and common byte order used on the network, you infringed. The "inventor" was a friend of a friend, and reportedly he said, when the patent was granted, "I can't believe they gave that to me."
Yeah, patents are utterly busted.
I hear this a lot, but a standard step in filing a patent is a patent search. You deliberately check to see if there is prior art.
Similarly, if you have a patent pending, you are required to advise the examiner as soon as you come across something that appears relevant. When I had one under examination by the USPTO I sent in a patent that I saw here on HN (which the examiner decided was irrelevant).
The point is that you have intent. Reading something and not recognising it as prior art is very different from reading something, recognising it as prior art and not disclosing it.
The rules you see about "don't read any patents" come from the professional paranoia which is universal to lawyers. It is a much tighter defence to say "it's impossible that we had knowledge and chose not to disclose, because we did not have knowledge, because we have an ironclad policy of avoiding reading patents" than it is to enter into detailed argument about who read or understood which patents on which dates.
The distinction is important. A corporate policy of "don't read patents" is not the same as the law. It is a pre-emptive defence tactic intended to deny a hostile litigant from using an expensive line of argument.
Again, I am not a lawyer, this is by no means advice. I just hope to convey that the law is generally far more comprehensive, sensible and subtle than telephone games give it credit for.
Similarly, if you have a patent pending, you are required to advise the examiner as soon as you come across something that appears relevant. When I had one under examination by the USPTO I sent in a patent that I saw here on HN (which the examiner decided was irrelevant).
The point is that you have intent. Reading something and not recognising it as prior art is very different from reading something, recognising it as prior art and not disclosing it.
The rules you see about "don't read any patents" come from the professional paranoia which is universal to lawyers. It is a much tighter defence to say "it's impossible that we had knowledge and chose not to disclose, because we did not have knowledge, because we have an ironclad policy of avoiding reading patents" than it is to enter into detailed argument about who read or understood which patents on which dates.
The distinction is important. A corporate policy of "don't read patents" is not the same as the law. It is a pre-emptive defence tactic intended to deny a hostile litigant from using an expensive line of argument.
Again, I am not a lawyer, this is by no means advice. I just hope to convey that the law is generally far more comprehensive, sensible and subtle than telephone games give it credit for.
I'm not strictly opposed to software patents, I do think that the threshold for what deserves a patent is far too low in the USA though.
Regardless, patents in general are a net good for mankind. It incentivises innovation, as the inventor gets a monopoly for a limited time on new inventions.
What's the point in inventing anything if some other company (likely with more resources than you) can just come along and steal your ideas?
Regardless, patents in general are a net good for mankind. It incentivises innovation, as the inventor gets a monopoly for a limited time on new inventions.
What's the point in inventing anything if some other company (likely with more resources than you) can just come along and steal your ideas?
> I do think that the threshold for what deserves a patent is far too low in the USA though.
A first big step forward would be to increase the threshold. The current situation is ridiculous, - I think everyone agrees on that.
> Regardless, patents in general are a net good for mankind. It incentivises innovation, as the inventor gets a monopoly for a limited time on new inventions.
I cannot entirely disagree on that, - at least from today's perspective. However, what did people think about open source software 30 years ago? They would have said something similar as you did, - which is that companies would not have the motivation to invest time and money. What do people think today?
A first big step forward would be to increase the threshold. The current situation is ridiculous, - I think everyone agrees on that.
> Regardless, patents in general are a net good for mankind. It incentivises innovation, as the inventor gets a monopoly for a limited time on new inventions.
I cannot entirely disagree on that, - at least from today's perspective. However, what did people think about open source software 30 years ago? They would have said something similar as you did, - which is that companies would not have the motivation to invest time and money. What do people think today?
Open source is not necessarily a profitable endeavour. Their are some exceptions, but presumably there would be a lot more open source options out there if it were more profitable.
Chefs and restaurants don't file patents on recipes AFAIK and they still manage. Didi basically copied Uber and the tech is still far inferior
You're comparing apples and oranges.
Imagine this case now:
I own a small company, Foo & Sons. I invent a new form of widget, that's 10% more efficient than other widgets. I can patent my new widget, and now I have exclusive right to manufacture these widgets in my factory for $1 a piece, selling them for $2 a piece.
Now, a big company, Widgets'R'Us, is capable of manufacturing these widgets for $0.50 each, as they have economies of scale. Without patent protection, they could make my widgets, and sell them for $1.50 each, putting me out of business. However, because of the patent, they'd have to pay me a fee if they wanted to make my widgets. I can now decide whether or not these royalties are more valuable tham making and selling widgets from my factory.
Imagine this case now:
I own a small company, Foo & Sons. I invent a new form of widget, that's 10% more efficient than other widgets. I can patent my new widget, and now I have exclusive right to manufacture these widgets in my factory for $1 a piece, selling them for $2 a piece.
Now, a big company, Widgets'R'Us, is capable of manufacturing these widgets for $0.50 each, as they have economies of scale. Without patent protection, they could make my widgets, and sell them for $1.50 each, putting me out of business. However, because of the patent, they'd have to pay me a fee if they wanted to make my widgets. I can now decide whether or not these royalties are more valuable tham making and selling widgets from my factory.
I guess I might have been overly broad in my comment. I guess I just wanted to point out cases where a patent feels ridiculous because the process is sufficiently difficult to replicate (e.g. cooking a recipe or doing a stand-up routine). Furthermore, the process in question needs to have sufficient demand such that an economy of scale actually has incentive to produce this product at large volumes.
I think there is a stronger case for patents for processes that can be easily replicated, reverse engineered, and made profitably at scale (this is a key factor IMO), like lightbulbs or batteries or something. Even then though, I think there are cases to be made that patents still may not provide benefit. For example, why do people still buy Advil or Tylenol over a generic brand, is it perhaps trust in the brand and confidence in the purity and safety of the product?
I think there is a stronger case for patents for processes that can be easily replicated, reverse engineered, and made profitably at scale (this is a key factor IMO), like lightbulbs or batteries or something. Even then though, I think there are cases to be made that patents still may not provide benefit. For example, why do people still buy Advil or Tylenol over a generic brand, is it perhaps trust in the brand and confidence in the purity and safety of the product?
Patents were originally invented to prevent knowledge loss due to trade secrets.
If this is the justification for patents, what's the justification for simultaneously granting legal protection to trade secrets?
Most modern pharmaceuticals would not exist without patents.
Why do you say that? Just because most modern pharmaceuticals were created with patents, doesn't mean that they wouldn't exist without patents.
Because trade secrets are virtually impossible in non-biologic drugs, the entire funding ecosystem around pharmaceuticals is driven by patents.
5 minutes of googling suggests that Penicillin was not patented and the mass production was later patented by the USDA (not some private pharma company). The entire modern funding ecosystem being patent based just means it's the most profitable business model, not that it's the only way to produce pharmaceuticals.
https://en.wikipedia.org/wiki/Penicillin#Mass_production
https://patents.google.com/patent/US2442141
https://en.wikipedia.org/wiki/Penicillin#Mass_production
https://patents.google.com/patent/US2442141
Some drugs likely would be discovered through non profit efforts. But it seems reasonable to believe that we would be quite a bit farther behind overall without the profit motive.
Of course it’s not the only way to produce pharmaceuticals, as pharmaceuticals are thousands of years old. But without patents the number of new drugs pharmaceuticals over the last 50 years would be probably 1-5% of it actually was.
Maybe we would have less but better pharmaceuticals, because it would be easier to improve the existing ones.
The way the system is set up now, there would be little incentive to make pharmaceuticals without patents. The R&D cost is insane, so to be profitable, pharmaceutical companies need exclusive rights to their drugs.
Bearing that in mind, I have no reason to believe a fully state-funded pharmaceutical system would be impossible, tied into healthcare. However, to make people complacent with that, it would have to be unbelievably transparent. Many people fear the idea of the state designing and providing them with drugs.
Bearing that in mind, I have no reason to believe a fully state-funded pharmaceutical system would be impossible, tied into healthcare. However, to make people complacent with that, it would have to be unbelievably transparent. Many people fear the idea of the state designing and providing them with drugs.
This would probably be a net positive.
If you think that you are extremely uninformed about the many useful pharmaceuticals out there and are probably thinking of a few Longreads articles about fentanyl abuse and ADD overmedication.
I'm well aware that we'd have lost millions of lives if drug inventors were not able to patent medicines like Penicillin... er wait. Other stuff...
I'm also aware that there are all sorts of great medicines that have been invented and created and help people.
And, the economic incentives and distortions created seem detrimental.
Your allusion to the opiode crisis is actually a pretty non-trivial example. The opioid crisis is deeply connected to companies trying to push drugs into the market, get people addicted, and profit off of patents. Opioides are probably killing more people now than many other drugs combined are saving.
I could do without the entire profession of psychiatry for the most part, and the actually useful drugs - psychedelics - are being brought to market by a non-profit and are non-patentable by design. HTTP://Maps.org
I'm all for curious, creative and skilled scientists making drugs to help people - I don't like the side effects of the way the current economic system behind medicine works.
I'm also aware that there are all sorts of great medicines that have been invented and created and help people.
And, the economic incentives and distortions created seem detrimental.
Your allusion to the opiode crisis is actually a pretty non-trivial example. The opioid crisis is deeply connected to companies trying to push drugs into the market, get people addicted, and profit off of patents. Opioides are probably killing more people now than many other drugs combined are saving.
I could do without the entire profession of psychiatry for the most part, and the actually useful drugs - psychedelics - are being brought to market by a non-profit and are non-patentable by design. HTTP://Maps.org
I'm all for curious, creative and skilled scientists making drugs to help people - I don't like the side effects of the way the current economic system behind medicine works.
They wouldn't be as profitable - the focus would shift: quality would increase.
Those are both really broad statements. Developing innovative software costs money as does developing an innovative product or technology. The point of patents isn't to incentivize implementation it's to incentivize innovation.
Whether OP peanut it or not, patents “incentivize” innovation with a terribly simplistic model of what that involves. The difference between “innovation” and “implementation” is like the difference between a business and it’s business plan. The motivation to regulate it is obvious but the results remain difficult to defend in light of the associated problems introduced.
I don't agree. I think that while it can be difficult to defend every instance of a patent or a particular implementation of patent law, this doesn't mean that every patent is bad or that the concept of patents is bad and needs to be outright abandoned which is what the OP was discussing.
America's patent system may not be perfect but this doesn't mean it's outright unproductive. This holds especially true when evaluated based on raw innovation. America's tech sector speaks for itself but is far from unique, America's pharmaceutical industry also comes to mind. Although widely criticized, and rightly so, the American industry produces nearly a third of the world's new molecular entities.
America's patent system may not be perfect but this doesn't mean it's outright unproductive. This holds especially true when evaluated based on raw innovation. America's tech sector speaks for itself but is far from unique, America's pharmaceutical industry also comes to mind. Although widely criticized, and rightly so, the American industry produces nearly a third of the world's new molecular entities.
Patents are far from the only factor affecting innovation, yet you seem to conclude that patents are good based on level of innovation in the US.
A logically similar argument (“fallacy of the single cause”) would be: Hawaii has a relatively low rate of gun violence yet their gun ownership is high, ergo gun ownership must be fine.
Of course some patents are good, but as market concentration increases in the US, IP has become abused by entrenched oligopolistic corporations. Most recent reputable studies find that the US patent system has probably been a net negative on innovation of late [1].
[1] https://www.economist.com/node/21660559
A logically similar argument (“fallacy of the single cause”) would be: Hawaii has a relatively low rate of gun violence yet their gun ownership is high, ergo gun ownership must be fine.
Of course some patents are good, but as market concentration increases in the US, IP has become abused by entrenched oligopolistic corporations. Most recent reputable studies find that the US patent system has probably been a net negative on innovation of late [1].
[1] https://www.economist.com/node/21660559
The title here is clickbaity and misleading.
Patents are hard to read, and very easy to believe (especially for lay people) that they claim far more than they actually do. What you need to do is ignore everything but the claims. I am by no means an expert (I'm still somewhat confused as how relevant dependent claims are, for example), but the starting point is still easy.
Reading the first claim, the nexus of the claim is that it's a virtual currency system were you send money from wallet A to wallet B by routing it through distinct subwallets. There also seems to be an element that the subwallets are effectively fixed-size wallets (e.g., each subwallet represents a different coin as physical currency would have), but I would not bank a legal case on that. The other independent claims are effectively repetitions of this idea.
So, at best, this could be construed as a patent on tumblers, and definitely nothing wider-reaching than that. Even the claim that it would cover tumblers is somewhat stretching it, I think.
Patents are hard to read, and very easy to believe (especially for lay people) that they claim far more than they actually do. What you need to do is ignore everything but the claims. I am by no means an expert (I'm still somewhat confused as how relevant dependent claims are, for example), but the starting point is still easy.
Reading the first claim, the nexus of the claim is that it's a virtual currency system were you send money from wallet A to wallet B by routing it through distinct subwallets. There also seems to be an element that the subwallets are effectively fixed-size wallets (e.g., each subwallet represents a different coin as physical currency would have), but I would not bank a legal case on that. The other independent claims are effectively repetitions of this idea.
So, at best, this could be construed as a patent on tumblers, and definitely nothing wider-reaching than that. Even the claim that it would cover tumblers is somewhat stretching it, I think.
It sounds like a way of PayPal holding in escrow. This doesn't solve transaction speed except for example repeat transactions (known amount long beforehand). You need a new wallet per every transaction, also?