Since posting yesterday about Pat Choate‘s lawsuit against Intellectual Ventures, I’ve been hit with a number of calls and emails with questions, the answers to which are largely, “I don’t know.” Very little information (as far as I can tell, no information) has become public beyond the complaint filed earlier this week.
That said, the information in the complaint itself is highly detailed, particularly for an opening shot. Since most lawsuits are
not about the money, one fairly common practice is to file a “vanilla” complaint, give your adversary a chance to come to their collective senses, and pony up whatever it is you’re owed. If that doesn’t happen on the time-table that the plaintiff is comfortable with, a far more detailed complaint usually gets filed, filled with all kinds of “embarrassing” information.
Choate’s lawyers have jumped right to step 2, so the lawsuit itself may not have been a surprise for the leadership at IV. On that note, despite reaching out to IV’s press contact yesterday, I’ve yet to receive a response. Meanwhile, Mr. Choate confirmed that my original post was accurate, but otherwise offered no new information.
For its part, IV might have been wise to simply pay Choate his fee, even if they felt he was no longer entitled to it. Recall last year, I noted:
Because of their size, and the mystery that shrouds their operations, IV has more at stake than a typical NPE ...
Why? Dan McCurdy’s comments also quoted in the post above summed it up:
As you know IV has operated since the beginning in great secrecy under the cloak of non disclosure agreements. Details on who has financed them, who has taken licences and for how much, their purchase practices, prices they have paid for purchases, sharing arrangements if any with patent sellers, accounting and tax treatment of revenues, licensing techniques and practices, the extent of patent holdings, subsidiaries and affiliates, and other details may all be relevant to the defence. Obviously the case will be closely watched.
Choate’s lawsuit gives IV’s litigation opponents an entirely new area to explore in discovery requests and deposition of key IV personnel, including positions it advocated with respect to patent policy, codification of damages provisions and the value of intellectual property in general. Admittedly, some lobbying information might be protected from discovery (evidently a function of the First Amendment that I had never heard of until a couple of years ago), but IV will only be able to stiff-arm discovery for so long.
For Choate’s part, it’s up to him to actually prove up the allegations in his complaint, and information I received today suggests that individuals other than Choate and IV operatives were primarily responsible for spearheading the education of labor unions to rally against patent reform.
In general, however, everyone I spoke with today seems to agree that, if not for the AFL-CIO’s staunch, last-minute opposition to patent reform, a far more pernicious reform bill would have passed several years ago.