Eolas is at it again

Eolas Technologies is a company that manages licensing for patents.

Eolas seeks to return value to its shareholders by commercializing these technologies through strategic alliances, licensing and spin offs. (source)

The problem is that Eolas is generally regarded as a bully trying to enforce a patent (Patent 5,838,906) that many experts feel should not have been issued.

The 906 patent, received in 1998 by the University and licensed exclusively to Eolas, describes ways that a Web browser can use external applications. (source)

(The US Patent and Trademark Office has made notoriously bad decisions relating to Internet technologies, causing many to wonder if they truly even understand the patents they’ve granted. Blackboard vs Desire2Learn is a great example; Blackboard acted much like Eolas, and their patents were eventually nullified by the PTO.)

Eolas sued Microsoft in 1999 for violating Patent 5,838,906, and in a rare show of solidarity, the Web and Open Source communities — normally very anti-Microsoft groups — rallied to Microsoft’s side. This included Sir Tim Berners-Lee, the founder of the Internet. They pleaded with Eolas to release the patent into public domain for the greater good of the global community.

Anybody in the browser field that studies the technology will see that its a very fundamental and basic patent to the World Wide Web. (source)

Despite the overwhelming negative response from the Web and Open Source communities, Eolas would not relent and forced Microsoft to modify Internet Explorer in a way that broke functionality on over hundreds of millions of web pages. Microsoft eventually forked over tens of millions of dollars in a settlement that allowed them to restore the functionality they had been forced to remove.

Other companies and products have used the same technology for years without paying royalties — Mozilla Firefox and Opera being the most well-known — but were not sued by Eolas, who chose to focus on the deep-pocketed Microsoft. (An initial jury verdict in 2003 awarded Eolas $521 million, but an undisclosed settlement was reached in 2007 after the case went through several appeals.)

This week — a year and a half after settling with Microsoft — Eolas has gone on the attack again, filing suit against “Adobe, Amazon, Apple, Argosy Publishing (publisher of The Visible Body), Blockbuster, Citigroup, eBay, Frito-Lay, GoDaddy, J. C. Penney, JPMorgan Chase, ‘transactional’ adult entertainment provider New Frontier Media, Office Depot, Perot Systems, Playboy Enterprises, Rent-a-Center, Staples, Sun Microsystems, Texas Instruments, Yahoo, and YouTube.” (article)

For the record, Eolas was founded by former University of California, San Francisco (UCSF) staff, and the patent they’re suing others for violating was developed at UCSF in the 90s. http://en.wikipedia.org/wiki/Eolas

I work at UCSF and am ashamed of these lawsuits.

The University of California owns Patent 5,838,906 and has licensed it to Eolas. The Regents of University of California are therefore the driving force behind Eolas’ behavior. By extension, UC is a driving force behind one of the biggest and most unpopular disruptions the Internet has known. If UC is really interested in public interests and good will — not to mention good publicity — I hope Patent 5,838,906 will be released into the public domain.

On a side note, knowing the University of California is being hit hard with budget cuts, I wonder if this latest blitz of lawsuits is an attempt at making up for budget shortfalls?

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Bollyboard?

Funny stuff. 🙂

The Adventures of Bollywood Blackboardwala
Here’s a small series of humorous episodes related to recent Blackboard and Open Source Learning Management Systems.

The mashups are made with snippets of classic Hindi Bollywood films, overlaid with user created subtitles, from a fun online tool called BombayTV from Grapheine.

The role of Blackboardwala is played by none other than Amitabh Bacchan, of course.

http://metamedia.typepad.com/metamedia/2008/04/the-adventures.html [link no longer available]

[from e-Literate]

Blackboard: Spoke too soon?

Alfred Essa posted this tidbit today:

An Important Correction to the Blackboard Patent Story
A number of us, including this blog, have gotten this story wrong. It’s time for a correction.

The USPTO has NOT invalidated the Blackboard patent. Instead the USPTO is proposing to invalidate the patent and has issued some preliminary documents for review and comment. At the end of the day the USPTO still might uphold the patent as valid.

Let’s hope this is just a matter of semantics, and that the USPTO will continue along their current path towards invalidating Blackboard’s patents. *fingers crossed*!

PTO sets Blackboard straight

All 44 of Blackboard’s patent claims have been thrown out by the US Patent & Trademark Office. It’s not 100% official (this is the first step in the process), but things are looking up… for everyone except Blackboard. I really think they shot themselves in the foot by trying to establish a monopoly via patents and lawsuits. The negative PR will haunt them for years.

Desire2Learn’s response (visit site)

On March 25, the U.S. Patent & Trademark Office issued its Non-Final Action on the re-examination of the Blackboard Patent. We are studying the document, found here, but in short, the PTO has rejected all 44 of Blackboard’s claims. We caution that this is a NON-final action; both Blackboard and Desire2Learn will have an opportunity to comment before a final action will issue, and after that, the decision will be subject to appeals.

However, we’re still pleased.

T.H.E. Journal article: USPTO Rejects Blackboard Patent Claims (visit site)

Blackboard’s e-learning patent looks to be going down. The United States Patent and Trademark Office this week sent out a “non-final” determination on the reexamination of Blackboard’s patent in which all of the claims on the patent were rejected. Blackboard still has a period of two months to respond to the determination.

We spoke with representatives from the two parties that filed for the reexamination of the patent: Desire2Learn and the Software Freedom Law Center. Their comments follow. Blackboard itself chose to release a statement (approximately 3:30 p.m. PDT) rather than speak directly with us today, although we might have additional comments next week. [ read the article ]

Michael Feldstein’s reaction (visit site)

Now, in addition to the fact that Blackboard will be able to argue against the ruling with the USPTO, there are a number of questions regarding how this affects the court case. Will the damages finding still stand? Will the USPTO ruling render moot D2L’s post-trial motion before the judge regarding invalidity? If not, will it imact that ruling? What happens to the issues of royalties and injunction going forward? [ read the article ]

Blackboard loses marketshare, moodle makes gains

Michael Feldstein also wrote a very interesting blog entry about LMS market shares, and how Blackboard is in steep decline while moodle appears to be booming.

The American Association of Community College’s Instructional Technology Council (ITC) has just published its 2007 Distance Education Survey Results, covering data from 154 U.S. community colleges.
[…]
Blackboard lost 7% market share in this segment over the past year. Even worse for them, it looks like this trend is accelerating … Blackboard could easily lose 20% market share over the next 3 years.
[…]
Clearly, Moodle is a winner, having gone from less than 4% market share to more than 10% (in this segment) in a year’s time. Moodle is now the only non-Blackboard LMS with a double-digit market share in this segment.
[ Read entire post ]

More on the Blackboard vs Desire2Learn verdict

Here are some great blog posts regarding the Blackboard vs Desire2Learn lawsuit.

Michael Korcuska (Executive Director of the Sakai Foundation):
Blackboard-Desire2Learn Verdict

This is certainly not either the end or, frankly, the most important part of the ongoing patent dispute. Completely separate from the Bb-D2L lawsuit, the US Patent Office will be re-examining the validity of Blackboard’s patent. The Sakai Foundation has always believed this re-examination will be the critical activity in ensuring the patent does not have a continued deleterious affect on innovation and openness in the community.
[ … ]
The Sakai Foundation and our colleagues at the SFLC will continue to challenge the patent at the USPTO and monitor developments elsewhere. One of the main reasons the Sakai project was started in the first place was to provide more choice for the higher education community. We hope that D2L will continue to offer its product in the United States. We do not want to see this verdict result in less competition and fewer choices in the marketplace.

Michael Feldstein (Principal Product Manager for Academic Enterprise Solutions at Oracle Corporation):
An Eye-Witness Account of the Trial

With all the coverage of the Blackboard v. Desire2Learn case, most of us (including me) have very little insight into the actual trial process. And with emotions running high about the case, it’s easy for people to jump to extreme conclusions about the process and everyone involved in it. That’s why I’ve asked Jim Farmer to write a first-hand account of the portion of the trial that he attended. In addition to being a knowledgeable observer of the legal system as a former expert witness in the U.S. Tax Court on behalf of the California State University in Los Angelese and in District Court in Denver on financial aid software, Jim is also a gentleman’s gentleman. I knew that he would give an account that is fair-minded and charitable to all parties involved. And that’s what he did.

Michael also quote Jim Farmer in another blog post: Blackboard By the Numbers

Using industry-average data, the cost of selling a Blackboard enterprise learning system is estimated to be $259,000 per sale. This cost compares to an estimated cost of $78,000 per sale for commercially-marketed open source software and $450 to $1000 for community-building for the uPortal product.

Scott Leslie was as incredulous as me when reading Jim Farmer’s account of the trial.
From Scott’s post Jim Farmer’s Eyewitness Account of the Blackboard Patent Trial

It is not difficult to see a picture here (and I want to be clear here, because I think Jim did a fine job being as impartial as possible, that these are my interpretations) of not just “Justice for Sale” but “Patent Law Judgements as Economic Diversification Program.” It’s bad enough to have to read this about Blackboard’s (god how I even cringe to write that name) expert witness:

Expert witnesses always are asked about their fees. When asked how much he had earned, Mark Jones was unable to give an answer. He said he had spent “hundreds of hours” and gave his rate as $325 per hour. (I thought he said $375, but court documents have the lower amount). He also said he had received $170,000 in fees from Blackboard before the end of 2007 as his [IRS Form] 1099 showed. It is likely he will have been paid more than $300,000 for his testimony when the trial is complete.

You may also be interested in visiting http://noedupatents.org/, which has a bunch of information about the case as well as links to many blogs on the topic, and blackfate, which is “a source of information and resources on the issue of Blackboard’s patent and the intellectual property issues of e-learning technologies in general.”

Not surprisingly, most LMS vendors have been suspiciously quiet about the verdict.

Blackboard wins (unfortunately).

Blackboard won its lawsuit against Desire2Learn. This really bums me out! I wonder if Desire2Learn will appeal (please say yes) and if Blackboard will start going after other LMS vendors?

Excerpt from the jury instructions:

Now, the patent in this case is United States Patent Number 6,988,138, also referred to as the ‘138 patent. The plaintiff, Blackboard, Inc., contends that the defendant, Desire2Learn, Inc., directly infringes and contributes to and induces direct infringement by others of claims 36, 37, and 38 of the ‘138 patent by performing the steps of the method covered by the patent in the United States. Blackboard states that it is entitled to damages for the alleged infringement in the form of a reasonable royalty and lost profits. Desire2Learn denies that it is infringing the ‘138 patent.

Desire2Learn also contends that the ‘138 patent is invalid. Invalidity is a defense to infringement; therefore, even though the PTO examiner has allowed the claims of the ‘138 patent, you, the jury, have the responsibility for deciding whether the claims of the ‘138 patent are valid.

The patent claims being enforced by Blackboard and contested by Desire2Learn (copied from the US Patent Office):

36. An method for providing online education method for a community of users in a network based system comprising the steps of: a. establishing that each user is capable of having redefined characteristics indicative of multiple predetermined roles in the system and each role providing a level of access to and control of a plurality of course files; b. establishing a course to be offered online, comprising i. generating a set of course files for use with teaching a course; ii. transferring the course files to a server computer for storage; and iii. allowing access to and control of the course files according to the established roles for the users according to step (a); c. providing a predetermined level of access and control over the network to the course files to users with an established role as a student user enrolled in the course; and d. providing a predetermined level of access and control over the network to the course files to users with an established role other than a student user enrolled in the course.

37. The method of claim 36 wherein at least one of the course files comprises a course assignment, further comprising the steps of: e) the student user creating a student file in response to the course assignment; and f) the student user transferring the student file to the server computer.

38. The method of claim 37 further comprising the steps of: g) the instructor user accessing the student file from the server computer; h) the instructor user reviewing the student file to determine compliance with the course assignment; and i) the instructor user assigning a grade to the student file as a function of the determination of compliance with the course assignment.

I still feel that the patent shouldn’t have been issued. Not only because there were people creating LMS systems prior to Blackboard’s existence, but also because the topics mentioned in steps 36, 37 and 38 are so generic to networking and online courseware that nobody should be granted a patent. It’s silly and has a negative effect on education around the world.

It’s like someone trying to patent how a library checkout system works: “Hey, I patented the concept of checking a book out from a librarian! You need to pay me a royalty for every book that you’ve ever checked out!”

Umm… I don’t think so.

Additional link: Desire2Learn’s blog also provides a link to a video produced by the Federal Judicial Center titled An Introduction to the Patent System. Interesting stuff.

This 17-minute video is designed to be shown to jurors in patent jury trials. It contains important background information intended to help jurors understand what patents are, why they are needed, how inventors get them, the role of the Patent and Trademark Office, and why disputes over patents arise.

Blackboard vs Desire2Learn

Blackboard‘s lawsuit against Desire2Learn just went to trial.

http://chronicle.com/free/2008/02/1630n.htm [link no longer working]

This lawsuit has the potential to bring a lot of LMS vendors to their knees. Blackboard’s patent claims are so broad that just about every LMS product can be considered to be in violation of Blackboard’s patents. [ You can read case files and see Desire2Learn’s opinions at their patent blog. Blackboard’s “Patent Pledge” is located here. ]

In Blackboard’s Patent Pledge, they basically try to give open-sourcers (such as Moodle and Sakai) some comfort. They state they won’t sue open-source projects, which implies they’ll go after any and all commercial ventures. It begins with:

Blackboard hereby commits not to assert any of the U.S. patents listed below, as well as all counterparts of these patents issued in other countries, against the development, use or distribution of Open Source Software or Home-Grown Systems to the extent that such Open Source Software and Home-Grown Systems are not Bundled with proprietary software.

The patent

The abstract of Blackboard’s main patent reads:

A system and methods for implementing education online by providing institutions with the means for allowing the creation of courses to be taken by students online, the courses including assignments, announcements, course materials, chat and whiteboard facilities, and the like, all of which are available to the students over a network such as the Internet. Various levels of functionality are provided through a three-tiered licensing program that suits the needs of the institution offering the program. In addition, an open platform system is provided such that anyone with access to the Internet can create, manage, and offer a course to anyone else with access to the Internet without the need for an affiliation with an institution, thus enabling the virtual classroom to extend worldwide.

This is jaw-dropping BS if you ask me. Could the patent possibly be more broad? Did the patent office seriously think no one else had been working on this concept at the time? This is a (well-publicized) recurring issue with software and technology patents, as the number of patent applications has increased, yet the ability of the patent office to keep up with technology and thoroughly investigate patent claims has stagnated. The patent office should never have granted this patent.

Forget about the patent: what about product quality?

I haven’t used Desire2Learn, but when we were looking for a new LMS at work about a year ago, I got a chance to read up on their LMS. I will freely admit that of the dozen or so LMS solutions I reviewed, Desire2Learn was my personal favorite. I was nothing but impressed. They adhere to standards (Desire2Learn has employees on the SCORM workgroup), and their products seem much better planned and executed than Blackboard’s products. Everything felt ‘cleaner’ to me.

Conversely, I’ve used Blackboard as a student at San Francisco State University, and I can honestly say it kinda sucked. We had nothing but problems in our courses. Our professors went so far as to find other free online resources we could use instead of Blackboard, even though SFSU had already paid for Blackboard. Eventually, SFSU decided they’d had enough with Blackboard and switched many courses over to the open-source Moodle. (I’m not sure if they still have a contract with Blackboard or not.)

Blackboard’s acquisition of WebCT (for $180 million) also made many WebCT users I know nervous… WebCT wasn’t exciting, but at least it had some stability. Blackboard’s acquisition of WebCT made users nervous that WebCT installations would be switched to Blackboard, which (to my knowledge) no one really wanted. Blackboard’s website gave a promise to keep WebCT installations intact [link no longer working], so I’m not sure what came of that.

Regardless, you can’t deny customers have issues with Blackboard’s LMS. Considering the sheer cost of a Blackboard installation and annual maintenance/licensing fees, you’d think they’d make a better product. When considering the unhappiness of many users, one has to wonder how much business Blackboard stands to lose simply because of its lousy product. Consumers have a choice! … or do they?

Blackboard’s Patent Pledge and lawsuit against Desire2Learn illustrate their willingness to stomp out competition. (BTW, we’re not talking chump change here — Blackboard is suing Desire2Learn for $17 million in lost profits.) My question is “who’s next?” SumTotal? Saba? Knowledge Planet?

Good luck, Desire2Learn. Hope you win!