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Patents, Innovation and the Law


Jeff Wexler

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It looks like they've taken the approach that they know the patent is valid only in the US, so have also made a version with limited functionality for the US market

Right, like Sonosax. Too bad for the US customers then.

I wonder how many more brands need to 'cripple' their technologies for the US market before Zaxcom is completely loved by everyone in the US?

 

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Hey! It's a free market and the patent rules are there no matter what you say. I think the patent system in the US is a bit bonkers. On the other hand, if you're actually allowed to protect you inventions from being pirated or copied, why wouldn't you?

So maybe the patent rules and general capitalism is the real culprit and not so much Zaxcom, who are just playing by the rules. In the US.

And that's the bottom line, this is local to the US. Both Glenn or Jacques could be not telling the whole truth and we wouldn't know. I'm finding it hard to believe that there'd be any real conflict if there wasn't a little truth in Zaxcoms allegations and Sonosax's creation of a US only unit. Unless there's a language misunderstanding..?

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Hey! It's a free market and the patent rules are there no matter what you say. I think the patent system in the US is a bit bonkers. On the other hand, if you're actually allowed to protect you inventions from being pirated or copied, why wouldn't you?

 

So maybe the patent rules and general capitalism is the real culprit and not so much Zaxcom, who are just playing by the rules. In the US.

 

And that's the bottom line, this is local to the US. Both Glenn or Jacques could be not telling the whole truth and we wouldn't know. I'm finding it hard to believe that there'd be any real conflict if there wasn't a little truth in Zaxcoms allegations and Sonosax's creation of a US only unit. Unless there's a language misunderstanding..?

 

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Sure its free, I can't argue with that and yes it is a bit bonkers, to the extent that the line between protecting inventions and possibly just grabbing opportunities to end competition has disappeared. 

Edited by Erkal Taskin
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 I'm finding it hard to believe that there'd be any real conflict if there wasn't a little truth in Zaxcoms allegations and Sonosax's creation of a US only unit.

The truth is that Jacques hates to spend his time (and money) on lawyers, he has been there and know what this means. Today, he puts all efforts to get the best tool in the hands of his customers. Not that he wound't have any chance to win the battle but this will take him 2 years and ten's of thousands of US$. Now would anyone go the short route and buy a license to this company, knowing how this was "proposed"...? 

Lawyers battle is not what makes Sonosax team what it is. It's actually incredible what amount of passion and time is put in their sound equipment. IMHO, Jacques sees building another machine more interesting than going to an US court fighting a US patent.

There is a long list of threatened companies by this patent holder. So, in the industry, when you recieve a request by this company, you know what this implies. Be sure they wound't spend their money if there wasn't any $ interestet.

This is the base for the cration of a monopole situation or a system that captures the customer (think of Apple with their Iphone/Mac/Itune...) Some are happy to embrace it, good for them.

It's a free market, good we still have the right to choose!

Pat

Edited by Patrick Tresch
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I also find it hard to believe that Glenn would put up such a facade. Why would he do that? This industry is so small that that would be apparent anyway. So if he's lying then I'm truly baffled and won't ever get my hands in Zaxcom. I hate that sort of behavior. I was bullied myself my entire childhood so it just makes me sick. And lying about it... Wow.

I'd be very interested to see this conversation in the open.

Both companies are doing their best, I'm sure, but allegations are one thing, and laws another. As I said if Jacques wasn't infringing on the patent he have no problem and no lawyers. Right?

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And I'm not saying that Jacques is lying, or that Glenn is either. I just find this conflict interesting. And I think it's only fair to ask for honesty from both camps

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It is not right in my opinion that Jac has chosen to make a private request on my part for technical information into this big deal. His post on this matter seems to be more about complaining about the patent system and the fact that a Zaxcom invention is preventing him from using that technology and selling it to the USA market as his own. I work very hard to be fair and honest in all facets of my life. I have Emails to back up all communications in this matter. This should not be a topic on social media because it is between Sonosax, the US distribution and Zaxcom. Since it is now a topic, I will be vocal on setting the record straight where needed. 

As a comment on some of the posts from yesterday, no one was or has been threatened with legal action in this matter. References to an implied threat are over reaching. However if someone is going to steal or commit a crime then there is always the threat of legal action. No matter the context.  The availability of a product in any market should not be determined by the threat of legal action and penalties but by the fact that selling technology that has patent protection is simply not the right thing to do.

Glenn

Edited by glenn
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The issue is not the use of the dual a to d converters. The issue is how the signals are combined. If there is no infringement issue why wouldn't Jacques just supply Zaxcom with the information that they requested? There is no law suit it's just an inquiry from zaxcom.

If Sonosax does provide the information, and the methodology is different then there is no issue here. And Sonosax can sell with no restrictions in the US and every one moves on. If there is infringement then Sonosax has the option to sell it here with limitations or they can license the technology from zaxcom.

It's as simple as that.

But what really annoys me is everyone making Zaxcom the bad guy here. Forget about your personal feeleing for Zaxcom, forget about your feelings for Glenn. The issue is Zaxcom did create a system that the US patent office deemed patentable and issued zaxcom a patent on the technology. That is the reality of the situation. Like it or not. Zaxcom, or any company that has a patent, needs to defend the patent or they can loose the patent and the time and money spend on research and development. It's akin to you recording audio and someone takes your audio without asking and without paying

There are other companies who caterers to our small market that hold patents and trademarks on the technology that we use - should they not defend them self in a similar situation? When Lectrosonics had an issue with Sony did anyone bash Lectro? Is this just another reason to hate Zaxcom? 

 

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First of all, thank you to all of you for posting in this Patent topic heading --- this is the right place for those who wish to continue this conversation.

Now, to Patrick who has said: "There is a long list of threatened companies by this patent holder" would you care to share this list with the rest of us? I think probably not as it is clear that your agenda is to further propagate mis-information that will serve to support the notion that Zaxcom is the bad guy here.

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Attempting to phrase this without accusation to either parties.

I guess I don't see a compelling reason to suspect that Sonosax is infringing on Zaxcom's patents. I know that the R4+ is using multiple ADs to increase dynamic range, but by the admission of all parties this is not patented and not inherently an infringement. If this published spec of increased dynamic range is the only evidence of infringement, I don't think it is reasonable to expect a competitor to voluntarily divulge how they accomplished it. I think that is what many of the "Sonosax defenders" are responding to. If Zaxcom has other reasons to suspect infringement, then their position is much more reasonable and sympathetic.

Of course I am sure there is much to this story outside of the postings on this forum (as expected).

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I have taken the time to do some more careful research on issues which I already knew quite a lot about, historically issues involving some of our most beloved and important companies to our industry. I have extracted from several sources a great deal of information regarding invention, innovation, intellectual property, legal battles and marketing, specifically things used in our world of sound recording. I will put some excerpts from my research at the end of this post (it will end up being a very long post so just ignore all of this if it is of no interest). Specifically, it should be known that Kudelski (Nagra) patented Neopilot sync (neo-pilotone) and aggressively defended that patent. This is one, but only one, of the reasons Nagra dominated the recording sync sound for picture marketplace. I will point out that it is only one of the reasons for Nagra's dominance --- Kudelski dominated because they made a wonderful machine. Did the patent help avoid competition? Probably, but so what? I will add that today, Kudelski Nagra has well over 700 patents and recently negotiated deal with both Apple and Netflix, two companies that had infringed on Nagra patents. Should Netflix users be up at arms for Nagra defending its long standing patents?

The other case that I will post here regards the Betamax vs. VHS format. Reading about all of this should help everyone have a clearer historical perspective on the current issues we have been discussing in this topic.

So, here goes (lots of reading for those who want it):

OpenTV, Nagra Pile Another Patent Suit On Netflix As They Gear Up For Apple Fight

Online video services from the likes of Netflix and Apple may represent the future of the TV business because of their popularity with consumers intent on watching video on a variety of screens beyond the large console in the living room, but today OTT video is proving fertile ground for another kind of enterprise: IP litigation.

Netflix has been served with another patent suit by OpenTV and sister company Nagra in the U.S. District Court for the Northern District of California, this one covering four patents related to digital TV services.

The news comes less than a week after the same two plaintiffs, both owned by Swiss company Kudelski, also filed a patent case against Apple. That latter case concerns five different patents. As with the Netflix suits, they are in connection with Apple’s digital media content services, covering both video and music as well as other services.

The most recent Netflix suit, and the Apple suit from last week, are both embedded below.

This latest case appears to be at least the third patent case filed by Kudelski against Netflix, with the first dating back to December 2012, and another from October 2013 in the Netherlands (where Netflix launched services last year). Given Netflix has operations in other countries, this could point to Netflix seeing legal heat from Kudelski elsewhere, too.

A spokesperson for the Swiss company has declined to comment. It’s not clear how much in damages it is seeking, but Kudelski itself is valued at around $770 million.

The patents in question in this latest case are as follows:

7,305,691: “System and Method for Providing Target Programming Outside of the Home”
7,644,429: “Broadcast and Reception, and Conditional Access System Therefor”
8,332,268: “Method and System for Scheduling Online Content Delivery”
8,621,541: “Enhanced Video Programming System and Method Utilizing User- Profile Information”
As with many patent suits, it looks like the case against Netflix, at least in part, is being used as a stick to get Netflix closer to cutting a licensing deal with Kudelski.

“On December 15, 2011, OpenTV wrote to Reed Hastings, CEO of Netflix, and notified him of the existence of The Kudelski Group patent portfolio generally. OpenTV explained that its technology may be relevant to several aspects of Netflix’s services, and invited Mr. Hastings to contact OpenTV to discuss the matter further,” the suit notes. “Hastings did not contact OpenTV to discuss the matter further.” After some discussions around licensing, the suit notes, no conclusions were ever reached.

Much of Kudelski’s activity appears to be directed by Joe Chernesky, SVP, Intellectual Property, at Kudelski, who Reuters notes company hired away from well-known patent holder/litigator/licensee Intellectual Ventures in May 2012.

But while many patent cases are described in the context of “patent trolls” who serve no purpose beyond collecting licensing fees for IP that they own, this appears to be more of a directly competitive case for OpenTV. The company is considered an early mover in the world of digital television and collectively Kudelski holds over 3,000 related patents, with 800 of them at OpenTV itself (which was spun out of tech originally at Thomson Mulitmedia and Sun Microsystems).

The company says it has some 120 pay-TV customers worldwide taking a combination of content protection, digital TV and advertising solutions.

………………………………………………………………………………………………

The Polish-born Mr. Kudelski was an engineering student at a Swiss university in 1951 when he patented his first portable recording device, the Nagra I, a reel-to-reel tape recorder, about the size of a shoe box and weighing 11 pounds, that produced sound as good as that of most studio recorders, which were phone-booth-size. Radio stations in Switzerland were his first customers.

The bigger breakthrough came seven years later, when Mr. Kudelski introduced a high-quality tape recorder that could synchronize sound with the frames on a reel of film. Mr. Kudelski’s 1958 recorder, the Nagra III, weighed about 14 pounds and freed a new generation of filmmakers from the conventions and high cost of studio production.

Mr. Kudelski received Academy Awards for his technical contributions to filmmaking in 1965, 1977, 1978 and 1990, and Emmy Awards in 1984 and 1986.

In the 1960s, Mr. Kudelski’s firm also began making miniature recorders for what its online catalog calls “surveillance and security” work. The first of these pocket-size machines was the SN “Serie Noire,” which the company’s Web site boasts was “originally ordered by President J F Kennedy for the American secret services.”

The Nagra’s value to customers like those was generally classified. But it received acclaim by consensus from professionals in the radio, television and film industries. By the early 1960s, Nagras were the standard recording equipment in all three industries. They remained dominant until the advent of digital audio recorders in the 1990s. The company now makes digital recorders, as well as some analog tape devices, but does not rule the market as it once did.

…………………………………………………………………………

By the early 1960s Nagras were standard in all three industries until the 1990s, when digital audio recorders came on to the market. The company now produces digital recorders, though competition from the Far East means they no longer dominate.

According to Chris Newman, a four-time Academy Award-winning sound engineer, "There was virtually no film made from 1961 until the early 1990s that did not use the Nagra."

Kudelski's first device, a reel-to-reel portable tape recorder called the Nagra I, created in 1951 while he was still a student, captured the imagination of Swiss radio stations before spreading farther afield. However, it was the recorder's third incarnation, the Nagra III, which set him on the road to revolutionising Hollywood as well as the British and French film industries.

Before the Nagra, film sets required sound recording devices that took several people to carry and maneuver them and usually had to be transported by truck. Coinciding with the portability and reduction in camera sizes, the introduction of the Nagra, weighing between 3.5-9 kilos depending on accessories, suddenly gave directors a new freedom from the conventions and high cost of studio production.

………………………………………………………………………………..

According to Carsten Diercks,[1] camera operator and filmmaker at West-German Nordwestdeutscher Rundfunk (NWDR) during the 1950s, pilottone was invented at the NWDR studio in Hamburg-Lokstedt, West Germany by NWDR technical engineer Adalbert Lohmann and his assistant Udo Stepputat in the early 1950s for single-camera 16mm TV news gathering and documentaries. The first program featuring the use of pilottone was the documentary Musuri - Es geht aufwärts am Kongo ("Musuri: Upstream/progress at the Congo"), shot in early 1954 in Africa and first broadcast on ARD on March 31, 1954. The new technology required new editing suites, and Musuri camera operator Diercks turned to a small nearby 6-man workshop named Steenbeck. The subsequent success of priorly shunned 16mm for TV program gathering facilitated by the pilotone system turned Steenbeck into a multinational corporation.

Neo-pilottone was invented in 1957 by Stefan Kudelski with the Nagra III tape recorder and subsequently patented as a means for achieving piloting synchronization utilizing a proprietary sync head for ¼" full track magnetic tape.

………………………………………………………………………………….

Before Napster and LimeWire, before Megauploads and the Pirate Bay, media companies’ epic struggle against copying, piracy and generally losing control over their creations can be traced to a legal fight more than 30 years ago over a device that has long since passed on to the great trash heap in the sky: the Sony Betamax.
When the Betamax videocassette recorder hit American living rooms in 1976, consumers, for the first time, could tape their favorite TV shows and watch them later. Hollywood hated it.

“The VCR is to the American film producer and the American public as the Boston strangler is to the woman home alone,” Jack Valenti, the garrulous head of the Motion Picture Association of America, told Congress.

The Supreme Court almost bought the argument that because it was illegal to copy shows without the copyright holder’s consent, the Betamax must be an accessory to crime. At the last minute, however, Justice Sandra Day O’Connor changed her mind. In a 5-to-4 ruling in 1984, the technology survived.

……………………………………………………………………………………

By 1976, the year following the launch of Betamax, the Vietnam War had ended and North and South Vietnam were reunified. Sony celebrated its 30th anniversary that year, and Morita proudly announced the birth of the post color television era, the video age. The introduction of the home-use VCR had caused the biggest stir and created the greatest expectations for Sony since the launch of the Trinitron. Sony sales branches throughout Japan were buzzing about Betamax, and how to launch it in their regions became their number one priority. From the pre-launch stage, study sessions and training seminars explaining how to connect a Betamax to a television were frequent. At that time, however, annual domestic demand for VCRs was still less than 100,000 units. Morita was brimming with confidence when he made his announcement about the upcoming video age. Would home-use VCRs become popular? The industry had its doubts. At any rate, full-scale production of Betamax looked ready to roll. However, in the same year, something happened which took Sony by surprise.

In September 1976, JVC announced the VHS-format VCR to compete head to head against Betamax. With this announcement, the VCR format battle began. The JVC product boasted two hours of recording time twice that of Betamax. The year before the Betamax release, Sony had approached Matsushita and JVC, its two partners for the U Format, about unifying product specifications. At that time, Sony had disclosed information regarding the Betamax specifications and technology to the two companies. In response, Matsushita and JVC delayed any decisions about unifying standards for a year. After Sony announced the advent of the video age and followed this with an aggressive sales drive, JVC began its own highly effective advertising campaign.

Sony took a closer look at the VHS format and everyone was aghast. The technology and know-how that Sony had willingly disclosed when it proposed the unification of the U and Beta formats was incorporated in the VHS format. Although Sony had freely given the two companies access to its basic, patented technology, it was impossible for Sony to hide its shock and surprise.

Even though Sony's Beta format and JVC's VHS format were technologically similar, the cassette sizes were different. Sony had patented the Omega wrap scheme for tape handling across a helical scanning head. To use of this technology, any company other than Sony would have to pay a license fee to Sony. JVC, wishing to market a similar video cassette, invented the VHS format and utilized an M-wrap, thus circumventing the need to pay Sony a license. The two were not compatible. The fact that there was more than one format foretold a grueling struggle for leadership in the home-use VCR market and a deepening fight for market share. The last thing either side wanted was to inconvenience the user. But the VCR war had begun and everyone was running for cover. Sony had worked very aggressively towards a unification of videocassette format, not so much as to insure licensing revenue, but rather to achieve uniformity in the marketplace for home video taping with the format that Sony had developed (that was clearly superior in all respects to the VHS format, the only exception being the recording and play time).

 

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Jeff, you have too much time on your hands. I love you man, you know that. 

I dont think zaxcom or glenn need all this and neither do sonosax really - because as a manufacturer having been around so long they too would know what to do if they wanted to do something. 

If you were doing this for the sake of the many people posting here, i'd say i miss Senator more than ever...

-vin

 

 

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Thanks to Chris for fact checking.

Glenn

I would ask Patrick to clarify his relationship but it would appear that he and Jac have co designed a product so clearly have some sort of working / personal relationship together considering he has been somewhat aggressive towards Zaxcom I think that may explain his one sided stance.

Link has the details.

http://www.mecasax.ch/products/fanplate

Sent from my Nexus 6 using Tapatalk

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The patent IS so specific and coincidence doesn't even figure into it. Even if Sonosax developed a manner in which the gain is handled without any knowledge of the specific way that Zaxcom does it (and patented the process), and that process is coincidentally the same as Zaxcom's, it is potentially a patent violation.Ignorance of a patented or proprietary technology does not give you the right to use it. We have to assume that the engineers at Sonosax know what they have designed and they have determined that it infringes on Zaxcom's patent in the US. There are 3 ways that this could have been resolved: 1. Sonosax could re-design their input to handle the gain in a manner that is not the same as Zaxcom's specific and patented process, 2. Zaxcom could license the patented technology to Sonosax for use in their recorder sold in the United States, or 3. Do not market the recorder in the US. Sonosax appears to have opted for number 3.

Whilst I broadly agree with most of what you say Jeff, I would like to make a few points, if I may.

I believe that Glenn's patent is for a 'virtual multitrack recorder', not for a recording transmitter as such. In his patent, the recording transmitter is a part of the system. This is not necessarily the same as having a patent for a recording transmitter.

The US Patent system is widely reported as being extremely broken. There was an excellent radio programme on BBC Radio 4 a year or two ago, see the article associated with it here http://tinyurl.com/mokxvng. It is no longer on their listen again site, but I will try to find it - it covered iirc amongst other things such absurdities as companies taking out patents for the colour orange!!

My good friend, who invented a brilliant led based ringlite for cinematic use, was run around the patent court in Marshall, Texas (see the article above) by a prominent US company who make 1x1 led panels, lets call them slightpanel, who claimed that they had a patent for ringlites. My friend, in response to their initital salvo, replied that this was clearly absurd, as amongst other evidence, he had a copy of American Cinematographer from the 1950's, showing how a DoP had made a ring of light around the lens to make a ringlight. This is called 'prior art' in patent legal speak. My friend spent about 2 days a week dealing with the case, as his was a startup company and he had no spare ££ at all to spend on patent lawyers. He also pointed out, really early on in the case, that slightpanels patent was actually for the bracket which they used to mount their ring of leds around the lens.

At one point it was suggested that slightpanels had a patent on using led lights to light for photography and filming (now think of the led that lights up when you turn the video camera on on your mobile phone - that could have been an interesting case). The case ran for over two years, keeping my chum out of the US market, and costing his company about 30% of all his time that should have been spent creating new innovation, and raising finance for the company. In the end, it was settled at the court steps, and I believe that each company paid their own fees and lawyer bills. One party had spent many, many hundreds of thousands of $$, and the other about a third as much. Nobody 'won', and each company agreed to not bother each other again, BUT ONLY OVER THESE PARTICULAR PATENTS AND PRODUCTS.

My point is that these cases can keep a party out of the US market, and can cost hundreds of thousands of $$, possibly far more than a company will ever make by being in that very same US market. I suspect that both Jaques and Kish (Audio Ltd) have taken pragmatic views as to the viability of the US market, and have simply chosen to not go there (to the US market, or to the patent courts). I can quite understand that in both cases, they may feel that their innovation is not infringing any US patents, but their actual choices are...

1 Start spending tens of thousands of $$ on legal expenses, not knowing if you will win, or even end up paying your own legal fees. Think how many units you will need to sell (dont forget that its not the over the counter price that will pay the legal fees, it is only the profit element that will pay them off).

2 Pay a licence fee when you may genuinely feel that you dont deserve or need to do so (this may well make the US selling price uncompetitive)

3 Dont sell the controversial product in the US, avoiding both scenarios 1 and 2.

 

I can see why on niche products such as we are discussing, option 3 may well be a good one.

Kindest regards to all,

Simon B

 

 

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The issue is not the use of the dual a to d converters. The issue is how the signals are combined. If there is no infringement issue why wouldn't Jacques just supply Zaxcom with the information that they requested?

 

Maybe he is waiting on his own patent... (:

*update*, seems Patrick has a close working relationship with Jac so I think it's safe to say he might be slightly bias ;-)

In the spirit of transparency Jack Norflus works for Glenn.

Edited by RadoStefanov
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