Intellectual Ventures sues AT&T, Sprint and T-Mobile

Verizon Wireless escapes unscathed, curiously enough (actually, there's nothing curious about it)

Intellectual Ventures, a self-described defender of inventors that is more commonly known as the patent troll founded by former Microsoft CTO Nathan Myhrvold, today filed suit against AT&T, Sprint and T-Mobile.

Melissa Finocchio, IV's chief litigation counsel, says in a statement: "The wireless communications networks of AT&T, Sprint and T-Mobile use a variety of important technologies covered by Intellectual Ventures' patents.  We previously attempted to discuss licensing options with each of these companies, but none were responsive. We filed a complaint for infringement today in the U.S. District Court of Delaware to get these three companies on a course toward compensating IV for the value of the inventions they use in delivering their wireless services."

(EFF launches 'Patent Fail' project to fight software patent abuse)

Those licensing options Finocchio mentions are likely the reason that Verizon Wireless, an IV licensee, is not named in the lawsuit. They were also a sizzling point of contention in a scathing story about IV done last summer by NPR. In that story - which if you missed I highly recommend you read - venture capitalist Chris Sacca likens those licensing options to a "mafia-style shakedown."   

Technology companies pay Intellectual Ventures fees ranging "from tens of thousands to the millions and millions of dollars ... to buy themselves insurance that protects them from being sued by any harmful, malevolent outsiders," Sacca says.

There's an implication in IV's pitch, Sacca says: If you don't join us, who knows what'll happen?

He says it reminds him of "a mafia-style shakedown, where someone comes in the front door of your building and says, 'It would be a shame if this place burnt down. I know the neighborhood really well and I can make sure that doesn't happen.' "

Sacca continues:

Here's what's funny: When I've seen Nathan speak publicly about this and when I've seen spokespeople from IV they constantly remind us that they themselves don't bring lawsuits, that they themselves aren't litigators, that they are a defensive player. But the truth is the threat of their patent arsenal can't actually be realized, it can't be taken seriously, unless they have that offensive posture, unless they're willing to assert those patents. And so it's this very delicate balancing act that is quite reminiscent of scenes you see in movies when the mafia comes and visits your butcher shop and they say, "Hey, It would be a real shame if they came and sued you. Tell you what: pay us an exorbitant membership fee into our collective and we'll keep you protected that way." A protection scheme isn't credible if some butcher shops don't burn down now and then.

In an email to us, Peter Detkin called the comparison to the mafia "ridiculous and offensive." Detkin wrote:

We're a disruptive company that's providing a way for patent-holders to recognize value that wasn't available before we came on the scene, and we are making a big impact on the market. That obviously makes people uncomfortable. But no amount of name-calling changes the fact that ideas have value. (See Detkin's full response here.)

True enough. But you can see why many people feel like lots of butcher shops have been burning.

The list of companies sued by Intellectual Ventures also includes Motorola Mobility, Symantec, Trend Micro, Dell, HP and Nikon.

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Copyright © 2012 IDG Communications, Inc.