Legal Pad

Yahoo IP Veteran Starts Patent Management Shop

How come I feel like I’m caught in a nerdy version of 1850’s San Francisco? Because the gold-rush into patenty businesses just won’t quit.

Today, Joe Siino, the former head of IP at Yahoo, resurfaced with his own IP asset management biz called Ovidian. The Berkeley firm, which at this point includes Siino and Berkeley IP law professor Rob Merges, will manage patent portfolios for companies, advise IP investors, consult on building IP legal departments, and, get this, develop and buy patents for itself.

See here and here, for other examples of patent lawyers leaving the comfy confines of law firms for the wild west of patent businesses. But first follow the jump to see how MoFo figures in this latest scheme.

Could Qualcomm Have Prevented Costly Broadcom Battle?

In the category of “What ifs,” this is a winner.

Back in 2002, Broadcom bought a grip of patents from a little-known company called Unova for $24 million. Broadcom ended up using some of them, like wireless technology patents 6,389,010 and 5,657,317, to sue rival Qualcomm and had success, winning damages and an injunction. On Sunday, Qualcomm agreed to pay Broadcom $891 million to settle those and other patent fights around the globe. So you see, those little patents helped Broadcom win the battle against the Big Q.

Here’s the thing: rumor has it that Unova (now known at Intermec) also offered to sell them to Qualcomm. Industry experts say that it would be natural for anyone selling wireless patents to offer them to both Qualcomm and Broadcom to drive the price up. “Whenever you get a really good wireless patent you call those two guys up,” said Ron Laurie, an IP consultant, noting that a settlement between the two might put a damper on future wireless patent sales.

Although Qualcomm GC Don Rosenberg said he didn’t know whether Qualcomm actually had a chance to buy the Intermec patents, he said he suspected that they were probably shopped to Qualcomm. Asked what would’ve happened if Qualcomm had bought them instead, he said: “If they hadn’t bought those patents…” before deciding that it would better if he didn’t answer the question.

— Zusha Elinson

Wilson Grills GC Over Unsettled Settlement

When is a settlement not a settlement?

That’s the issue being hashed out at a rather interesting bench trial in Alameda County Court this week before Judge Steven Brick.

The dispute is between two Asian semiconductor foundries: China-based foundry Semiconductor Manufacturing International Corp. and its rival, Taiwan Semiconductor Manufacturing International Corp. SMIC agreed to pay TSMC $175 million to settle a pretty serious trade secret theft case in 2005, but TSMC claims that SMIC breached the settlement terms by continuing to use the stolen information. SMIC claims that TSMC changed the terms of the settlement on them and that there was no official settlement.

SMIC is represented by Wilson Sonsini Goodrich & Rosati, and the company’s CEO Richard Chang (who’s on the stand as we write this) flew in from China. Wilson lawyers showed Chang a good time taking him out to the tony Village Pub in Woodside on Monday night — the night before the trial started. Carmen Chang (no relation), a corporate partner who represents SMIC, was there. So was David Steuer, who’s heading the trial team. “I told David he could only have one drink,” Carmen Chang joked on her way to the courtroom.

Wilson puts TSMC GC Dick Thurston on the stand, after the jump.

Former In-House Sets Up Outsourced GC Shop

It’s the middle of a recession. Law firms have been falling apart left and right. Not a great time to start your own shop, right?

But Laura Peter, former GC at Immersion, has just launched her own legal biz called Global General Counsel and says it’s the perfect time.

“It hits the niche of these particular times where the smaller companies can’t afford to spend the bazillions but still need high-quality legal work,” Peter told Legal Pad on Tuesday.

Peter is targeting smaller tech companies that can’t afford a general counsel and don’t want to pay big-firm rates for all their legal services. She’ll be like an “outsourced general counsel,” billing at the rate of a senior associate or junior partner at a big law firm.

An IP lawyer by trade, Peter left San Jose’s Immersion earlier this year as the company changed management and started to veer away from its focus on IP litigation. Before that she was an in-house lawyer at other companies in the Valley.

So how’s the business faring in its first few weeks of existence? Peter said she’s got a “few nibbles,” but expects business to pick up after the holidays.

— Zusha Elinson

Rounsaville: Who Needs a Schlep Like This?

In-house luminary Guy Rounsaville Jr. joined The Doctors Company with great fanfare in August.

The fanfare was deserved: Rounsaville was general counsel for more than 20 years at Wells Fargo Bank with a stint as Visa’s GC. But just a few months later Rounsaville, 64, resigned from the Napa medical malpractice insurer. Legal Pad caught up with Rounsaville to find out why he left so suddenly.

“It’s a great company and it has very good people the only problem was the location,” he told us.

Former GC Leaves Troubled Tech Company

There’s a big ol’ mess going on over at Cadence Design Systems in San Jose — and the company’s longtime former GC has resigned.

Cadence, which makes tools used to produce integrated circuits and the like, announced last week that it had a revenue recognition problem and would have to make a restatement. Apparently, $24 million that the company counted as revenue from sales contracts in the first quarter of 2008 should’ve been recorded over the life of the contracts.

Resignations and class actions, after the jump:

Facebook Users Riot Against Newly Named GC

Facebook hearts its new General Counsel Ted Ullyot, a Republican lawyer who worked for George W. Bush and Alberto Gonzales in D.C.

Or click for the screengrab

Facebook’s users? Not so much.

About a dozen Facebook groups have formed overnight with names like “Sack Ted Ullyot! No Bush lawyers for Facebook” or the more subdued “Ted Ullyot for FB General Counsel? Please.” Search for “Ted Ullyot” on Facebook if you don’t believe us.

The groups are gaining popularity. One called “Demand that Facebook General Counsel Ullyot Resign” has over a thousand members. Writes Dick Sattler, a Missoula, Mont., Facebooker and member of the “Ted Ullyot for FB General Counsel? Please.” group:

“I am thoroughly appalled that Facebook would even consider employing this war criminal and traitor. If this goes forward I will be forced to abandon Facebook for its tacit support of torture, war crimes, shredding the constitution, and abuse of executive power.”

Will a popular uprising of Facebook users cause Zuckerberg and Co. to throw Ullyot overboard? Unlikely, but the poor guy ain’t gonna be getting a lot friend requests anytime soon. Plus, even though Ullyot told us Monday that he'd signed up for Facebook, we can't find his page anywhere. 

—  Zusha Elinson

New Facebook GC: A Republican in Dem Territory

So what does Facebook, a company run by the young and the liberal, think about new GC Ted Ullyot having some very strong Republican ties (clerked for Scalia, worked for Bush and Gonzo)?

“I think it’s always good to have different voices,” said Facebook spokesman Larry Yu, noting that second-in-command Sheryl Sandburg was chief of staff at the Treasury during the Clinton administration.

The Democrats control Congress … maybe Facebook is placing a bet against Obama being able to win the White House, too.

But still, Ullyot would be the first Facebook employee this election cycle to donate to the Republican effort to keep the White House.

And just in case you were wondering whether Ullyot was involved in the whole U.S. Attorney firing scandal that took down his former boss Alberto Gonzales, that was a year after he’d left his post as the DOJ’s chief of staff. Ullyot said he still holds “Al” Gonzales in high regard. Yup, he calls him Al.

—  Zusha Elinson

Swing-and-a-Miss on Billion-Dollar IP Damages

Last year, Alcatel-Lucent convinced a San Diego jury that it deserved $1.5 billion (yes, with a ‘b’) from Microsoft for infringing on a couple of little patents. It was the biggest patent damage award in history.

Although the patents only covered MP3 audio technology used in Microsoft Windows media player, the huge verdict was calculated by taking a percentage of each computer sold with the software on it. That made many IP lawyers question the wisdom of the so-called “entire-market value rule,” which basically means that a victim of patent infringement should get a royalty based on sales of the whole product, even if the patent only covers a tiny part.

The verdict was set aside by U.S. District Judge Rudi Brewster of San Diego, but IP litigators everywhere were hoping that an appeal to the federal circuit by Lucent would clarify the entire-market-value rule. Maybe the Federal Circuit U.S. Court of Appeals would put an end to even the possibility of billion dollar verdicts?

“People looking to rein in demands thought this was the best case,” said Sean DeBruine, an IP litigator with Alston & Bird in Palo Alto. “It seemed like the poster child.”