Showing posts with label Freedom of Speech. Show all posts
Showing posts with label Freedom of Speech. Show all posts

Tuesday, November 29, 2022

Elon Musk threatened war on Apple's app tax, then deleted his tweet, but the gauntlet is out of the bag: he can win this, just needs to separate antitrust issues from advertising budget allocation

After repeatedly criticizing Apple's app tax and even raising the prospect of a Tesla Phone, Elon Musk crossed an important line yesterday by giving Apple the choice between exempting Twitter from the App Store's usurious app tax or an outright antitrust war. In a series of tweets taking Apple to task over different issues, Mr. Musk shared the following image (but later deleted the tweet):

A near-simultaneous tweet about the app tax can still be found:

Actually, Mr. Musk was "generous" in the sense that Apple's app tax even exceeds 30% (except for those who fall under the Small Business Program, but that's a negligible share of total App Store revenues). Apple passes on parts of its taxes (which app developers would not owe in most cases if they could transact directly), makes app discovery ever more expensive, and Apple makes billions just with its base developer program fees (charging about four times per year as Google charges Android developers as a one-time fee). And some believe--credibly so--that Apple will soon run its own in-app ad platform on iOS, meaning Apple would take a cut of in-app ad revenues as well (after kneecapping the existing networks).

Mr. Musk can win this war if he has to wage it. There is only one concern--not a huge one, but worth mentioning: conflation of issues can backfire.

Yesterday's tweets addressed a trio of issues: the app tax; Apple's app review (from a freedom-of-speech angle); and Apple's decision to slash its Twitter advertising budget. The first two are reasonably closely related, and would be remedied the same way: by means of alternative app stores and direct installs ("sideloading"). Apple allegedly threatened to Twitter with ejecting its app from the App Store, but didn't clarify over which issue or set of issues:

So I would agree that app review and app tax are manifestations of the same problem of monopoly abuse. But the third issue--ad spend--is the odd man out. It is easy to predict that in a hypothetical scenario where Mr. Musk takes that highway exit to the war zone and seeks a temporary restraining order and preliminary injunction to have the Twitter iOS app reinstated on the App Store, Apple is going to hold it against him that he started his Apple criticism yesterday with a reference to advertising budget allocation:

Apple will then foreseeably tell the court that a few weeks before, Mr. Musk had threatened renegade advertisers with a "thermonuclear name & shame":

Arguably, Apple is now the first company to have been exposed as a company reducing its ad spend on Twitter. Apple may have been Twitter's single largest advertiser until then. But other companies even withdrew entirely.

I'm not saying that Apple could reasonably spin all of this as "he's suing us over the App Store because we exercised our right to advertise where we want." Mr. Musk could point to his long-standing criticism of the app tax. The hypothetical removal of Twitter from the App Store would raise far more important issues, and any judge or juror could easily see what the case is really about: Apple's monopoly abuse. But there would be an unnecessary smokescreen for Mr. Musk's lawyers to deal with.

As an app developer who brought his own complaints over Apple's and Google's tyrannical censorship, I obviously hope there will be further escalation and that Apple (and preferably also Google) will be sued, just like I can't wait to see a cross-platform Microsoft app store compete with the incumbents as well as other future entrants like an Epic Games Store.

The attention that the App Store monopoly would get if Mr. Musk went to war would far exceed what Epic Games' "Project Liberty" achieved in the summer of 2020. Mr. Musk and Epic's founder and CEO Tim Sweeney would be perfect comrades in arms. An anti-monopoly-abuse alliance made in heaven. In fact, after last year's district court judgment, Mr. Musk expressed sympathy for Mr. Sweeney's fight. Where? On Twitter, of course.

Friday, January 6, 2017

Could a patent attorney (prosecution or litigation) lend pro bono help to Techdirt's Mike Masnick?

This morning I have just become aware of a Hollywood Reporter article on a defamation lawsuit (complaint, PDF) against the company behind and the principal author (Mike Masnick) of the Techdirt website brought by Dr. Shiva Ayyadurai, whom Techdirt has attacked over his claims to have invented email.

I have not communicated with Mike or anyone close to him in years and don't have any intention to do so. The only instance I remember was in 2012 or 2013: a brief exchange on Twitter regarding the monopoly power conferred by standard-essential patents. I don't remember for sure but it's possible that, whether or not my name was mentioned, I got attacked by him over my pro-copyright positions (Oracle v. Google). Also, far be it from me to endorse the way he wrote about this subject in general and Dr. Ayyadurai in particular. If I had taken an interest in the subject, I'd have done it differently.

The plaintiff is seeking damages of "not less than [$15 million]" plus punitive damages on top, a public retraction, and an injunction.

The attorney representing Dr. Ayyadurai, Charles J. Harder, previously obtained a $140 million verdict for Hulk Hogan against Gawker. While Peter Thiel had a hand in that case, I don't see any indication so far that Mr. Thiel has any involvement with the action against Techdirt. I would caution everyone against baseless speculation, and I'm saying so not only because I'm deeply grateful to Mr. Thiel for his support of Donald Trump's campaign and his service on the Trump transition team. He decided to swim against the Silicon Valley tide. By now, even liberals acknowledge that Silicon Valley has started to like Donald Trump's plans.

There must be enormous pressure on Techdirt to settle, which Dr. Ayyadurai would be able to portray as an indication of his claim of email inventorship being legit. Primarily, Techdirt needs help from a defamation lawyer. However, I believe Techdirt's defense would benefit immeasurably from the early involvement of a patent prosecution attorney or patent litigator. The key legal question will be whether or not the freedom of speech covers Mike's accusations, and that means the question of whether the plaintiff actually "invented email" will be at the heart of the case.

Patent law is the law of inventions. Even though the defamation question here will not come down to a patent validity analysis (there is no patent in play, just a copyright registration and earlier documents), I believe patent professionals are in the best position to perform the inventorship-related analysis that is needed for Techdirt to defend itself or, hypothetically speaking, to realize that there's no reasonable alternative to a settlement. Patent attorneys know how to determine whether the prior art fully anticipated something or whether any delta is (non-)obvious (and to compare this to what is nowadays deemed to constitute email). Even courts would likely be receptive to references to certain principles of patent law in this context.

In the ideal scenario for Techdirt, the case for total anticipation would be so strong that the case might be resolved in their favor even without a jury trial. If there was only partial anticipation, it would come down to whether the delta (if any) justified a claim of having invented email or whether it would only have supported a narrower claim such as (whatever may be the case here) having invented a particular feature or having independently come up with something that existed before.

The complaint cites all sorts of credit that was given to Dr. Ayyadurai, who has every reason to be proud of what those people said, but what is needed--and lacking so far--is a solid, professionally-crafted feature-by-feature analysis of the relevant prior art (see this email for a starting point) and the claimed invention. Also, it's a typical patent law question to determine what a person skilled in the art would have considered essential characteristics of "email" at the relevant point(s) in time.

In case any of you would like to help, please contact Techdirt directly. I wanted to help bring the truth about email inventorship to light by making this call and I'll be interested in the outcome of the case, but I won't play any role in it. If Mike made indefensible accusations, he should retract them and accept the consequences, but if other people, such as potentially Ray Tomlinson, deserve credit for having invented email, then the truth should be told in the further proceedings. And that's a question of facts, not of the color of one inventor or the other. Let's focus on the technical facts.

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Sunday, December 18, 2016

From software patents to Apple's tax case, the European Commission has been a premier source of fake news

The political establishment on both sides of the Atlantic still can't deal with the fact that Donald Trump won because voters rejected corrupt, incompetent and unprincipled "all talk, no action" politicians for all the right and left reasons. One of the transparent attempts to delegitimize a historic victory for common, hardworking and law-abiding people is centered around so-called "fake news." Very worryingly, we may even see legislation in Germany and other parts of Europe aiming to impose fines on social networks for not playing their part in the political establisment's censorship efforts led by a future equivalent of what George Orwell already envisioned to be a "Ministry of Truth" in his novel "1984." I'll take a closer look at such Orwellian initiatives some other time.

In reality, the political establishment in Europe, which has been committing treason against European citizens for some time and continues to do so, just hates the fact that the truth about its failures spreads virally. They say that "fake news" about crimes commmitted by "refugees" leads people to vote for "populists," but there simply are cases of rape committed by so-called "refugees" on a daily basis in Germany, and those cases are not merely reported by anti-establishment websites but by reputable, local newspapers. Those articles go viral on Facebook, but "viral" isn't necessarily "fake." The victims range from young children (8-14 years of age) over men in their thirties to women in their seventies or eighties. Those numerous incidents just don't make it into national news because leftist journalists don't want the truth to come about how misguided their ideology is and because politicians don't want citizens to realize how terrible the situation has become, much less in a pre-election year.

The Austrian government replied to a parliamentary inquiry about rape cases involving "asylum seekers" and stated 91 suspects in the first nine months of 2016. Considering that Germany has about ten times the population size of Austria and, just in terms of a power of ten, also about ten times as many "asylum seekers," this means a couple of cases per day in Germany. If politicians don't like those news, they have to change their migration policies, but instead of protecting citizens against crimes, they complain about "fake news" and seek to regulate social networks.

If anyone truly wanted to drain the "fake news" swamp in Europe, Brussels would be a good place to start. While I agree with the European Commission on some issues and disagree on others, I view the institution's public statements with utmost skepticism and believe Brussels-based journalists are all too often misled by what comes out of the Berlaymont building.

Just a few examples of EU Commission "fake news":

EU software patent directive: the CII lie

In 2002, the EC proposed a "directive on the patentability of computer-implemented inventions." It claimed back then and throughout the years of the legislative process (which ended when the bill got thrown out by the European Parliament in 2005, which is exactly what I had been campaigning for) that patents on "computer-implemented inventions" weren't software patents. The examples that the supporters of the proposal gave all the time were about computer-controlled washing machines, automated braking systems, and airplanes. They said that the whole plan was only to ensure that innovations in those fields could be patented but software patents? No, they said that our movement was totally wrong since software "as such" was going to be excluded.

It was nothing but a damn lie. A damn lie propagated by the Commission, by the equally-mendacious national governments of the EU member states, large corporations (also including their industry bodies, of course), the European Patent Office (with respect to its credibility, let me just refer you to Dr. Roy Schestowitz's great work concerning what is going on there), and patent attorneys in private practice.

What frustrated us the most was not even that those who directly or indirectly stood to gain from software patents were dishonest. That was very bad for sure, but the worst part was that news agencies and the general press kept propagating those lies--not merely in the form of quotes but in ways that portrayed the Commission position as the truth and our position as an opposing view by "open source" people. And when we talked to them, they often just referred us to what the European Commission was saying--no matter how much of a lie it was.

With only one exception, the Brussels-based journalists who covered that legislative process weren't particularly sharp. By comparison, I met far more receptive and intelligent people a few years later in connection with some competition cases. But, to be fair, it wasn't easy for the general press to figure out something at the complex intersection of law, technology, and economics. The proposed directive appeared to focus on "technical" inventions except that its definition of what is "technical" was purely tautological. It also didn't help that we had some lunatics in our movement who pursued a radical anti-IP agenda. Still, reasonably intelligent and committed journalists could have figured things out if they had made an effort:

  • The easiest-to-understand indication that should have given anyone except the most obtuse people pause was SAP's public support (at government roundtables, conferences, etc.) and its claim (which it even made in an advertisement in a Brussels publication shortly before the decisive vote) that the proposed directive would provide SAP with protection for its innovations. SAP never made washing machines, automated braking systems, airplanes, or any other hardware. There you had a pure software company saying that this directive would afford it patent protection.

  • While the Commission's original 2002 proposal did not allow so-called "program claims," a clause that allowed patent claims of "a computer program, characterized by [...]" kind made its way into the proposal as the European Council (where the governments of the member states meet and decide) got involved, but the Commission nevertheless kept saying the directive wasn't going to result in patents on software "as such". A patent claim defines the scope, and anyone who practices what the claim describes is an infringer. If the claim is on a "computer program," then it's obviously a software patent claim (and not a washing machine claim). For example, if the software that optimizes the fuel consumption of an airplane is covered by a program claim, then it's also infringed by a flight simulator that uses the same formula.

Unitary patent propaganda: first published, then taken down

Last year, the IPKat blog dismantled the Commission's ridiculous propaganda for its unitary patent package (including the Unified Patent Court). Then the Commission pulled its statement, almost certainly due to the IPKat's competent criticism.

Juncker: "When things get serious, you have to lie"

The Euro currency is one of the EU's top three failures. Economists had warned politicians that a common currency was doomed to fail without a common fiscal and economic policy, but Mitterrand wanted the euro in order to prevent Germany from becoming too powerful after reunification and Kohl just wanted to make history no matter what damage this would do in the long run.

In connection with the EU's sovereign-debt crisis, Commmission president and former Eurogroup chief Jean-Claude Juncker said: "When it becomes serious, you have to lie." You can read this in Bruno Waterfield's article, and the quote has been widely reported by other media as well.

So how can anyone trust the Juncker Commission anymore? I, for one, can't.

This YouTube video featuring Juncker may be part of what certain politicians would like to ban as "fake news."

Apple's "state aid" tax case

When the Commission's Apple tax ruling becomes public, I'll look at it in detail, but even before all details are known, it's already clear that the Commission can't really be trusted in this context.

The first issue I have is that the Commission has tried to manufacture a "state aid" case. Article 107 of the Lisbon Treaty defines "state aid" as follows:

"any aid granted by a Member State or through State resources in any form whatsoever which distorts or threatens to distort competition by favoring certain undertakings or the production of certain goods"

There is no distortion of competition here. I would agree with the Commission if this were a case of Ireland giving Apple subsidies that Apple would use to undercut its competitors. However, Apple has never undercut anyone. It took almost ten years after the launch of the iPhone for a company not to undercut Apple (Google, with its Pixel phone).

It's not competition that the Commission is concerned about. All major tech companies do the same. There's a populist agenda in play here.

The following claim by Commissioner Vestager fails to pass even the most basic plausibility check:

"[T]his selective treatment allowed Apple to pay an effective corporate tax rate of 1 per cent on its European profits in 2003 down to 0.005 per cent in 2014."

Nobody has ever denied that Apple paid approximately $400 million in Irish taxes in 2014 (Tim Cook disclosed that number in a radio interview on September 1, 2016). So, obviously, Apple's overall tax rate was a whole lot higher than 0.005%. Otherwise Apple would have had to generate profits in Ireland of 20,000 times $400 million, which would be $8 trillion!

Again, I'll try to find out more, but so far this looks like just as ridiculous as saying that a proposed piece of patent legislation doesn't cover software "as such" when SAP said it did.

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Thursday, December 10, 2015

Why would a patent office be afraid of bloggers? Only if it has something to hide. Like the EPO.

Over the years I've learned not to take things personally, but there are situations when it's hard. I did take it personally when I faced a shitstorm in 2012 after a totally erroneous decision by a judge who still doesn't correctly state the law on the copyrightability of declaring API code. And this morning I saw something that is just absurd. I'm talking about the last bullet point in the following quote from the EPO's official allegations against Elizabeth Hardon, a staff union leader they're now trying to fire:

"(1) actively cooperated with the campaign conducted by C [suspended in-house judge] against the EPO, members of the Administrative Council, and individual EPO staff members.

Specifically, the evidence demonstrates that she:

  • discussed with C the strategy for his campaign and provided instructions to him;

  • provided C, on at least one occasion, with non-public contact details for all delegates of the Administrative Council, which C used to send anonymous defamatory email messages;

  • was in personal contact with at least one blogger habitually attacking the EPO, Mr. FM of FOSS Patents, which resulted in the publication on FOSS Patents of attacks regarding alleged corruption of delegates of the Administrative Council;"

First, I don't disclose sources unless they wish to be disclosed. Also, I sometimes get messages from anonymous sources. Therefore, I can neither confirm nor deny any allegations of someone having been in contact with me, regardless of how truthful or untruthful an allegation is. As for "personal contact", I can generally say that no SUEPO (staff union) person has ever met me or even talked to me over the phone--I listened to some of their speeches at demonstrations in Munich, without approaching them. I only talked to two persons at an EPO demo. I asked one guy to let me take a picture of a banner, and I said hello to an EPO in-house judge I happen to know for a reason that has nothing to do with the labor dispute.

Second, I comment on the EPO situation from time to time (not even very frequently), but "habitually attacking the EPO" is really not the way I view it. On one major issue I even agreed with the president of the EPO (though an expert on suicides tends to agree with SUEPO).

Third, regardless of who my sources are, none of my sources even tried to persuade me to allege "corruption of delegates of the Administrative Council [of the European Patent Organization]." The closest thing to corruption--and "closest" is an overstatement--that I wrote about was that the EPO allegedly pays for the visits of its supervisors (especially those from relatively poor countries) to Munich doctors. I wrote about this because I heard it at a SUEPO demo. I remember that Mrs. Hardon was among the speakers, but I also remember with certainty that the thing about medical care was mentioned by a male speaker at a demonstration about a year ago. Apart from that, I merely mentioned that Administrative Council delegates often hope to become EPO president or vice president, and that this ambition appears to prevent at least some of them from doing their supervisory job right.

Actually, it's only after the above reference to "corruption" in an official EPO document that I start to wonder whether the EPO leadership's hypersensitivity may have a factual reason that I don't know about yet.

Getting back to the first point: even if one wanted to assume arguendo that Mrs. Hardon had communicated with me, there wouldn't be anything wrong about it. Managing Intellectual Property magazine put me on their list of the 50 most influential people in IP in five of the last ten years, and Canadian IP lawyers and blogger Barry Sookman once listed FOSS Patents among the top three patent law blogs in the world. SUEPO must have the right to communicate with someone like me, just like BMW or Allianz couldn't prevent their staff representatives from talking to the general press.

The EPO leadership is just paranoid about bloggers who criticize what's wrong with the way that organization is run. But those EPO folks don't appear to understand that they're only making things worse by the day. They threatened legal action on at least four occasions against TechRights author Dr. Roy Schestowitz, who is still the most prolific writer on the EPO labor dispute. Now they blame a staff representative for my commentary without a factual basis.

What do they have to fear? They must have something to hide.

If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or follow me on Twitter @FOSSpatents and Google+.

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Tuesday, November 24, 2015

Shame on the European Patent Office for its legal threats against TechRights author Dr. Roy Schestowitz

The European Patent Office is the last dictatorship on Central European soil. Local police cannot allowed to enter the EPO's facilities without an invitation from the president. National court rulings cannot be enforced; compliance is voluntary. Employees and visitors are subjected to covert surveillance. And if employees are fired (or "suspended"), which just happened to several staff representative, they won't get their day in court for about ten years.

The EPO's leaders have a rather selective attitude toward the law. When it's about their wrongdoings, they want their organization to be a lawless, autocratic island that disrespects human rights. But when the rules of the world around the EPO come in handy, the leadership of the EPO tries to leverage them against those who dare to criticize it.

A Munich newspaper reported last week that the EPO even tried to get a staff union lawyer disbarred. And today World IP Review has reported on legal threats by the EPO against Dr. Roy Schestowitz, author of the TechRights blog (temporarily the link was broken, but at the time of publication, it worked). In July it became known that the EPO blocked access from its local network (which examiners use for prior art searches) to TechRights. I strongly criticized that move, and found it futfile. But the EPO leadership stops at nothing, and is now trying to silence its fiercest and most frequent critic in the entire blogosphere.

Dr. Schestowitz had mentioned this on Twitter, but he had not revealed any specifics before the WIPR article. You can find his commentary on the WIPR story--and information that purports to indicate a publisher has also been threatened--here.

TechRights has always been an opinionated, rather combative blog. Still, with almost 20,000 blog posts, Dr. Schestowitz had not received a legal letter before an EPO lawyer sent him one.

Many thousands of TechRights posts took aim at Microsoft, and typically not in diplomatic terms. But Microsoft, which has a huge and sophisticated legal department, never thought it prudent to send a cease-and-desist letter. Nor did any other company that was criticized, and there were many (though Microsoft used to bear the brunt of TechRights' criticism).

The EPO leadership must be very afraid of TechRights. It should be. Dr. Schestowitz is doing a first-rate job at keeping track of developments at and around the EPO. He doesn't miss a beat. I don't mean to say that I would always use the same terminology, but the EPO should respect the freedom of speech. If the EPO leadership wants more positive press coverage (and not just from its "media partners" like Les Échos), then it should tackle the underlying issues.

If the EPO ever sued Dr. Schestowitz, I would contribute money and lend an endorsement to a crowdfunding effort to finance his defense.

If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or follow me on Twitter @FOSSpatents and Google+.

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