Ask industry professionals who are the biggest parasites in the videogame industry and you might get a surprising answer. It may not be pirates, cynical bloggers, overzealous forum posters or even unethical developers and publishers. This week, at least, it may be a company like Hillcrest Labs.
On Wednesday, Hillcrest Labs filed a complaint with the International Trade Commission as well as a federal lawsuit against Nintendo claiming that the gaming giant infringed on four of its motion sensing patents. Hillcrest is the latest in a long legacy of lawsuits filed against major console manufacturers, lawsuits that have cost companies like Microsoft, Sony and Nintendo millions of dollars in penalties and legal fees. As recently as 2006, Microsoft alone was facing 35 to 40 patent infringement lawsuits company wide.
Over the past few decades, patents have become a tool in the arsenal of companies looking to aggressively manipulate the market or swing a quick buck. Being awarded a technology patent, which seems to now be as difficult as ordering a Happy Meal, has become the equivalent of buying a corporate lottery ticket, a Powerball for entrepreneurial opportunists. After all, you don’t necessarily have to do any work, any complicated R&D, any expensive marketing or distribution. You just have to wait until your patents are vaguely similar to obvious technology that a company like Nintendo might use, and then you bide your time until it chalks up quarterly profits of $996 million and fire your tactical nuclear patent infringement strike.
Hillcrest Labs, whose claim to fame seems to be that it has similar technology that uses motion sensing for remote controls, follows nipping at Nintendo’s heels only a month after the House That Mario Built was ordered to pay $21 million in damages and $2 million in prejudgment interests to Anascape Ltd., for – wait for it – patent infringement used in the Nintendo Wii’s motion sensing controller.
Of course, Anascape took the long-view and tossed a nice patent infringement suit at Microsoft for its Xbox 360 controller as well for good measure, just another drop in the bucket of litigation that MS is dealing with. Hillcrest, which appears to not have noticed that Nintendo has been infringing on its patents since 2006, has strictly put the crosshairs on the Big N.
We have gone from a nation that awarded an average of 80,000 patents a year in the 90s to nearly 200,000 patents awarded annually now. And, it appears now the only practical cap on the number of patents released each year is an issue of manpower, as the PTO is wading through a backlog that could take years to complete.
This inflation of patents is a result of a number of changes over the past two decades that arguably began when the Patent Trademark Office moved to a fee-funded basis, but didn’t really hit its stride until the government office redefined the idea of what constitutes a patent. With the liberalization of what defines patents, where methods and ideas can be patented for everything from billing systems to instant messaging, the least scrupulous abusers of the system need only look at existing technology and explore whether the ideas as well as the technology employed have been properly documented. This is among the ways you end up with companies like Interlink Electronics Inc., which in 2006 sued – wait for it – Nintendo for infringing on patents when it created the Wii Remote.
It’s hard to think of Hillcrest Labs’ claim as particularly legitimate. It is the third small, largely unknown company to take a swing at Nintendo for daring to actually produce a product rather than just writing “INNOVATION” in crayon on a sheet of graph paper, submitting it to the PTO and waiting in the tall grass until a likely target chalked up a billion dollars in a single quarter. Even giving Hillcrest the benefit of the doubt on not noticing that Nintendo has been apparently infringing on their clearly documented genius for years, how can we be sure that it didn’t infringe on Anascape or Interlink in creating its own technology?
Apparently all three came up with the idea of the Wii Remote first.
In fact, I’m hoping that these companies eventually turn on each other like the pack of rabid hyenas they seem to be, and file lawsuits and counter-lawsuits against each other in a patent infringement feedback loop orgy. Unfortunately, scavengers don’t really work that way. They are hunters of opportunity, working in packs to assail that which is vulnerable before picking the bones clean while snarling at each other with blood-soaked lips. And once the bones lay dry and desiccated on the savannah floor, they return to the tall grass where they lie quiet and still until the next target of opportunity wanders past.
Sean Sands is a writer, co-founder of www.gamerswithjobs.com and most recently the patent holder for being sarcastic in articles about videogames on the internet. Bloggers be warned!