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iOS developers face legal threats over Apple's in-app purchase system

post #1 of 45
5/13/11 at 10:54am
Thread Starter 
A number of iOS developers were hit with legal threats this week, alleging patent infringement through utilizing Apple's in-app purchasing feature for App Store software.

Developers were first sent legal complaints this week accusing them of patent infringement, according to TUAW. Developers have not yet been sued, but were informed that they have 21 days to license technology related to in-app purchases.

The maker of "PCalc Lite," James Thomson, as well as Chicago-based developer Patrick McCarron were both sent letters via FedEx claiming patent infringement related to iOS software.

The complaints stem from patent holding firm Lodsys, and are related to U.S. Patent No. 7222078, entitled "Methods and Systems for Gathering Information from Units of a Commodity Across a Network, MacRumors discovered on Friday. The original patent was filed in December 2003, but dates back through continuations to earlier applications as old as 1992.

The invention is credited to Dan Abelow, though his portfolio of patents were sold to Lodsys in 2004. It is Lodsys that has threatened legal action against iOS developers.

So far, there is no evidence that Apple has been targeted in the complaints sent out. Apple controls the App Store for iOS devices, including the iPhone and iPad, as well as the in-app purchasing protocol.



In-app purchases were first introduced in 2009, when Apple release iOS 3.0 for the iPhone. Though the feature was initially restricted to pay software, later that year Apple granted creators of free applications the ability to charge for add-ons and additional content.

Just like purchases made directly through the App Store, in-app purchases are charged by Apple to a user's iTunes account. Apple takes a 30 percent cut of all transactions made for software on iOS devices.
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post #2 of 45
5/13/11 at 11:04am
Doesn't this seem a big odd? Going after the developer? Wowzer. Probably due to the fact they know legal action with the smaller people would be less of a struggle than dealing with apple and their billions?

So odd.
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post #3 of 45
5/13/11 at 11:08am
Damn, can Apple do anything nowadays without being sued?

I know the story says there isn't any evidence so far that Apple has been sued for this, but I guarantee they have been.
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post #4 of 45
5/13/11 at 11:13am
I wonder how generic those systems for data collection are. If the patent is one of those mindless ones where they describe something obvious which gets thrown out of court, then this company may just be trying to scare developers into submission, knowing that Apple would kick their asses.

I hate these patent sitters and the lame patent office that doesn't understand IT or what is and is not innovation.

Many of the most important software concepts were invented in the 70s and forgotten in the 80s.

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Many of the most important software concepts were invented in the 70s and forgotten in the 80s.

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post #5 of 45
5/13/11 at 11:22am
This is obviously an extortion racket, with the "patent holder" going after app developers rather than Apple with the expectation that they'll be able to force them to pay for licensing to avoid the legal costs.
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post #6 of 45
5/13/11 at 11:23am
Quote:
Originally Posted by guch20 View Post

Damn, can Apple do anything nowadays without being sued?

I know the story says there isn't any evidence so far that Apple has been sued for this, but I guarantee they have been.

Guarantee? How?

It's likely a deliberate strategy to go after developers and not Apple. Pretty smart
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post #7 of 45
5/13/11 at 11:26am
I wonder if developers could circumvent the patent troll by registering their entity in another country and operating from there. Then said troll would have to sue Apple for providing the content infringing on the patent and that's not going to happen.
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post #8 of 45
5/13/11 at 11:27am
Dear Patent Troll,

I appreciate your absurdity. I am merely a pawn in Apple's plan to dominate the world. I use their tools, their guidelines, their framework, and do their bidding. Take it up with them.

Thanks,

developer
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post #9 of 45
5/13/11 at 11:30am
Quote:
Originally Posted by AppleInsider View Post

The complaints stem from patent holding firm Lodsys, and are related to U.S. Patent No. 7222078, entitled "Methods and Systems for Gathering Information from Units of a Commodity Across a Network, MacRumors discovered on Friday. The original patent was filed in December 2003, but dates back through continuations to earlier applications as old as 1992.

The patent claim is gobbledygook. Supposedly it relates to getting feedback on "commodities." It would be interesting to see why the particular accused infringers were selected. Maybe they collect more feedback on the "user's perception of the commodity" as compared to other app developers.



Here is claim 1:

1. A system comprising: units of a commodity that can be used by respective users in different locations, a user interface, which is part of each of the units of the commodity, configured to provide a medium for two-way local interaction between one of the users and the corresponding unit of the commodity, and further configured to elicit, from a user, information about the user's perception of the commodity, a memory within each of the units of the commodity capable of storing results of the two-way local interaction, the results including elicited information about user perception of the commodity, a communication element associated with each of the units of the commodity capable of carrying results of the two-way local interaction from each of the units of the commodity to a central location, and a component capable of managing the interactions of the users in different locations and collecting the results of the interactions at the central location.
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post #10 of 45
5/13/11 at 11:37am
This is stupid. I'm still waiting on a decent overview of the lawsuit to see what's going on, but from what I've read they're basically suing developers who us IAP to "upgrade" an app from a trial version to a paid version.

Aka, they're suing over an upgrade button. Are they also suing all those companies that provide upgrade options via their computer programs?

According to Nilay Patel, Intellectual ventures (a known patent troll) is involved. Most likely they are going after individual developers hoping to get quick payoffs because their patent would struggle to hold up in court. It's also apparently very similar to a patent Microsoft received at a later date. No doubt if they went after Apple, they'd lose the patent so they're hoping to scare some devs into paying out first.

It's just another sign that US patent law is completely broken.
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post #11 of 45
5/13/11 at 11:41am
Quote:
Originally Posted by Buck View Post

I wonder if developers could circumvent the patent troll by registering their entity in another country and operating from there. Then said troll would have to sue Apple for providing the content infringing on the patent and that's not going to happen.

They would still name the developer as the defendant because the infringing acts occur in the U.S. You can sue a foreign entity in a U.S. court as long as the foreign entity engages in activity in the U.S. There is still no need to sue Apple.
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post #12 of 45
5/13/11 at 11:43am
Quote:
Originally Posted by ash471 View Post

The patent claim is gobbledygook. Supposedly it relates to getting feedback on "commodities." It would be interesting to see why the particular accused infringers were selected. Maybe they collect more feedback on the "user's perception of the commodity" as compared to other app developers.



Here is claim 1:

1. A system comprising: units of a commodity that can be used by respective users in different locations, a user interface, which is part of each of the units of the commodity, configured to provide a medium for two-way local interaction between one of the users and the corresponding unit of the commodity, and further configured to elicit, from a user, information about the user's perception of the commodity, a memory within each of the units of the commodity capable of storing results of the two-way local interaction, the results including elicited information about user perception of the commodity, a communication element associated with each of the units of the commodity capable of carrying results of the two-way local interaction from each of the units of the commodity to a central location, and a component capable of managing the interactions of the users in different locations and collecting the results of the interactions at the central location.

Someone needs to tell the author of that claim the definition of "run-on sentence"
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post #13 of 45
5/13/11 at 11:44am
Quote:
Originally Posted by Menno View Post

This is stupid. I'm still waiting on a decent overview of the lawsuit to see what's going on, but from what I've read they're basically suing developers who us IAP to "upgrade" an app from a trial version to a paid version.

Aka, they're suing over an upgrade button. Are they also suing all those companies that provide upgrade options via their computer programs?

According to Nilay Patel, Intellectual ventures (a known patent troll) is involved. Most likely they are going after individual developers hoping to get quick payoffs because their patent would struggle to hold up in court. It's also apparently very similar to a patent Microsoft received at a later date. No doubt if they went after Apple, they'd lose the patent so they're hoping to scare some devs into paying out first.

It's just another sign that US patent law is completely broken.

Why would they go after Apple?

Apple isn't the one infringing on the patent, the software made by developers who are not Apple are the things infringing.
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post #14 of 45
5/13/11 at 11:45am
These ecommerce patents are really bogus because the AppStore is just a proxy for credit cards. Ultimately the bank sends you a bill regardless of where you shopped. The part that is frustrating is that the law suit is attacking Apple devs directly when ecommerce is everywhere, however, the patent owners have no complaint with the other 10 billion small companies using ecommerce only Apple.

Life is too short to drink bad coffee.

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Life is too short to drink bad coffee.

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post #15 of 45
5/13/11 at 11:49am
There is no reason to start off by suing Apple. Apple probably has the resources to crush the patent holder, regardless of the merits of the case. These guys want a quick settlement. The way you do that is harass the Apple developers who have almost no resources to fight a patent lawsuit. My guess is that many of these developers would be better off getting a default judgement against them and filing bankruptcy rather than fight a patent infringement suit. Of course Apple doesn't want this patent looming over its developers and will want to take care of it fast and easy......which means pay 500K-1M to settle.

If the litigation goes anywhere at all, I would guess that the defendants will be the ones to get Apple named as a defendant. Apple appears to me to be an essential party to the infringement. In case you weren't aware, a defendant can ask the court to bring another defendant into the lawsuit. (which is basically the defendant making the plaintiff sue someone else).
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post #16 of 45
5/13/11 at 11:50am
Quote:
Originally Posted by anonymouse View Post

This is obviously an extortion racket, with the "patent holder" going after app developers rather than Apple with the expectation that they'll be able to force them to pay for licensing to avoid the legal costs.

Apple needs to get solidly behind these developers, right away.
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post #17 of 45
5/13/11 at 11:52am
Quote:
Originally Posted by Patranus View Post

Why would they go after Apple?

Apple isn't the one infringing on the patent, the software made by developers who are not Apple are the things infringing.


It´s not only Apple, the developer should also walk free from this. Imagine: how moric a judge would have to be to say that PC Calc or any other app is a "commodity". By definition, a commodity encompases identical products (silver, oil, corn, etc.) Apps are all different.
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post #18 of 45
5/13/11 at 11:53am
Quote:
Originally Posted by Patranus View Post

Why would they go after Apple?

Apple isn't the one infringing on the patent, the software made by developers who are not Apple are the things infringing.

Nobody is infringing on this patent, or maybe everybody is. Maybe I am when I take a shit. Its hard to tell.

However if offering in-app purchasing is found to be in violation of this patent, Apple will lose boat loads of money. So Apple is getting sued, if only in proxy.

The real problem is that the patent doesn't make any sense.
I wanted dsadsa bit it was taken.
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I wanted dsadsa bit it was taken.
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post #19 of 45
5/13/11 at 11:56am
Quote:
Originally Posted by josephwinters View Post

Doesn't this seem a big odd? Going after the developer? Wowzer. Probably due to the fact they know legal action with the smaller people would be less of a struggle than dealing with apple and their billions?

So odd.

There's nothing odd about it at all. Apple's lawyers have money to fight in court. The developers are often small and will likely be unable to afford attorney's to fight. The hope is to make money off the little guy in settlements.

Basically, it's less effort to go after the developers. I think Apple will likely get involved, as its eco-system is under attack.
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post #20 of 45
5/13/11 at 11:57am
The first guy we know of who get issued this patent was from Scotland. I believe that UK courts dont really take Software Patents as seriously as American courts - you have to produce some work, not just an idea - so they can pull from the American App Store.
I wanted dsadsa bit it was taken.
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I wanted dsadsa bit it was taken.
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post #21 of 45
5/13/11 at 12:07pm
Quote:
Originally Posted by guch20 View Post

Damn, can Apple do anything nowadays without being sued?

I know the story says there isn't any evidence so far that Apple has been sued for this, but I guarantee they have been.

But if they have been then they have been cleared and these will be tossed.

Which makes me think Apple has not been and all these smaller ones will be tossed because they are following Apple's instructions in good faith and these folks will be forced to sue Apple.
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post #22 of 45
5/13/11 at 12:09pm
Quote:
Originally Posted by Patranus View Post

Why would they go after Apple?

Apple isn't the one infringing on the patent, the software made by developers who are not Apple are the things infringing.

There isn't a patent to infringe upon here, which is why they're not going after apple (they know it won't stand up in court)

And considering the devs are using a system similar/identical to apple's IAP, the patent troll could go after apple (and a MUCH bigger payoff) if they felt they stood a chance, but they know they don't.

They're claiming that offering a "Upgrade now!" button is something that should be patent-able, no matter HOW that button is offered (or how much the code differs from the patent holders)
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post #23 of 45
5/13/11 at 12:10pm
Calling anonymous. Come in anonymous
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post #24 of 45
5/13/11 at 12:10pm
Quote:
Originally Posted by ash471 View Post

Here is claim 1:

1. A system comprising: units of a commodity that can be used by respective users in different locations, a user interface, which is part of each of the units of the commodity, configured to provide a medium for two-way local interaction between one of the users and the corresponding unit of the commodity, and further configured to elicit, from a user, information about the user's perception of the commodity, a memory within each of the units of the commodity capable of storing results of the two-way local interaction, the results including elicited information about user perception of the commodity, a communication element associated with each of the units of the commodity capable of carrying results of the two-way local interaction from each of the units of the commodity to a central location, and a component capable of managing the interactions of the users in different locations and collecting the results of the interactions at the central location.

If one assumes "commodity" can mean any valuable piece of electronic media, this would apply to absolutely anything digitally purchased over a network. That means any downloaded software (in app or not), any music, any eBook, any useful forms (IRS, etc.) or any other information. As such it is far FAR too broad a brush and should be struck down on that fact alone.
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post #25 of 45
5/13/11 at 12:11pm
Quote:
Originally Posted by Mister Snitch View Post

Apple needs to get solidly behind these developers, right away.

+1.

Do the right thing here, Apple, and stand behind the developers that make your App Store great.
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post #26 of 45
5/13/11 at 12:29pm
Quote:
Originally Posted by ktappe View Post

If one assumes "commodity" can mean any valuable piece of electronic media, this would apply to absolutely anything digitally purchased over a network. That means any downloaded software (in app or not), any music, any eBook, any useful forms (IRS, etc.) or any other information. As such it is far FAR too broad a brush and should be struck down on that fact alone.

EXACTLY: You can´t assume that. No computer or app is a commodity.
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post #27 of 45
5/13/11 at 12:37pm
Quote:
Originally Posted by Mister Snitch View Post

Apple needs to get solidly behind these developers, right away.

+1 as well.

Apple should know that its third-party developers is what made iOS such the runaway hit. So much so they are doing the same thing on the Mac. Apple, now is the time for you to Man-Up, get behind your developers, and say "Not on My Watch."
-- Mike Eggleston
-- Mac Finatic since 1984.
-- Proud Member of PETA: People Eating Tasty Animals
-- Wii #: 8913 3004 4519 2027
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-- Mike Eggleston
-- Mac Finatic since 1984.
-- Proud Member of PETA: People Eating Tasty Animals
-- Wii #: 8913 3004 4519 2027
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post #28 of 45
5/13/11 at 12:46pm
obviously, apple should not defend developers on every issue. But, clearly, this is one of those issues where apple should extend their legal resources in all it's might to the developers.

Not only because this is bullshit, but because this is an attempt to set a legal precedent that will open a flood of patent troll lawsuits on ios developers. You know- the ones who make money to take away in lawsuits. The chilling effect on development, not to mention the major legal hurdles that will become a part of developing an ios app could be devastating.
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post #29 of 45
5/13/11 at 1:55pm
Quote:
Originally Posted by Mister Snitch View Post

Apple needs to get solidly behind these developers, right away.

I completely agree with that.
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post #30 of 45
5/13/11 at 1:57pm
Really?? Did the patent holder read their own patent? The patent is for a customer learning system. Basically what could be called a forum but more specifically a tasked base program sand box that allows customers to dictate the learning of the system.

The stated patent core purpose:

One of the core purposes of the invention is illustrated in FIG. 15. This is the ability to learn interactively and iteratively from the users of products and information systems anywhere in the world while they are in usewithout having to travel to their sites (or without having to bring them to a testing laboratory). Since this is a two-way link, it also offers the ability to respond meaningfully to customers and users based on worldwide, local, organizational or individual needs regardless of where they are located.

This means that something like Microsoft Visual SourceSafe.

The patent clearly states the purpose of the patent here:

This Customer-Based Product Design Module invention uses a combination of computer hardware, software and communications technologies to construct a module that is built into certain products and services, to establish a network of customer-vendor-distributor interactions and communications (or a network of internal organization-wide interactions in the area of computer-based performance). These make possible new customer and user roles in the design and development of products and services, and customer-vendor relationships. Over time, this may produce a gradual transfer to customers of commercial direction and market control, both in individual cases (such as the evolution of a particular product) and in aggregate, from vendors and distributors.

FAILED!! Check the PDF images on the page. It doesnt mention anything closely related to the App Store and the purchase of a product but rather the learning from customer expereince and altering this distribution method. When means Apple is the target and not the developers. Thats like trying to sue developers for uploading videos to YouTube and getting feedback from the users to improve the video postings...oopps YouTube is NEXT!!! RUN FOR YOUR LIVES!!!!
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post #31 of 45
5/13/11 at 1:58pm
Quote:
Originally Posted by Hal 9000 View Post

It´s not only Apple, the developer should also walk free from this. Imagine: how moric a judge would have to be to say that PC Calc or any other app is a "commodity". By definition, a commodity encompases identical products (silver, oil, corn, etc.) Apps are all different.

But, but your honor, they ARE all the same!!! Just bits!!!!









yes that was sarcasm...
Hiro's Hall of Shame ignore list: Tulkas -- because we know he wasn't born dumb.
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Hiro's Hall of Shame ignore list: Tulkas -- because we know he wasn't born dumb.
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post #32 of 45
5/13/11 at 2:00pm
Quote:
Originally Posted by anonymouse View Post

I completely agree with that.

seconded.
Hiro's Hall of Shame ignore list: Tulkas -- because we know he wasn't born dumb.
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Hiro's Hall of Shame ignore list: Tulkas -- because we know he wasn't born dumb.
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post #33 of 45
5/13/11 at 2:00pm
It is a strategic move to sue developers and not Apple. Apple is employing the same strategy by suing HTC and not Google. Go after the weak link in a chain first.
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post #34 of 45
5/13/11 at 2:28pm
I am serving fair notice of patent infringement upon each user of products in the US. You are breathing. Said breathing violates my patent for the inhalation and exhalation of air using a diaphragm and musculature to induce the transfer of air volume between the natural air environment and lungs.

Each air user has 21 days to respond with a completed licensing request. There is two tier pricing system available: 1) per use licensing with a charge of 20¢ per exhalation; and 2) a volume pricing agreement with the price set at $60 per day paid weekly or $450 per week paid monthly.

Units of exhalation may be purchased in advance in units of exhalation and bulk purchase quantities of 1 day, 1 week, 1 month and 1 year. We take all major credit cards.

/snark
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post #35 of 45
5/13/11 at 5:22pm
Quote:
Originally Posted by Patranus View Post

Why would they go after Apple?

Apple isn't the one infringing on the patent, the software made by developers who are not Apple are the things infringing.

No, the in-app purchase code is made by Apple. It's Apple's framework that is being used.
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post #36 of 45
5/13/11 at 8:00pm
I didn't see anyone point out that one of the effects of this suit against developers would be to drive developers away from the iOS platform. Who would benefit by that?
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post #37 of 45
5/13/11 at 10:23pm
This reminds me of Microsoft collecting license fees from HTC for Android handsets under threat of suing them.

"The cobbler's children have no shoes", is a saying that applies a lot to companies who provide products and services. -KDarling on Google Search.

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"The cobbler's children have no shoes", is a saying that applies a lot to companies who provide products and services. -KDarling on Google Search.

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post #38 of 45
5/13/11 at 11:03pm
Quote:
Originally Posted by PXT View Post

I wonder how generic those systems for data collection are. If the patent is one of those mindless ones where they describe something obvious which gets thrown out of court, then this company may just be trying to scare developers into submission, knowing that Apple would kick their asses.

I hate these patent sitters and the lame patent office that doesn't understand IT or what is and is not innovation.

You mean something that is not innovation like pinching to zoom, portrait and landscape docking, the shape of a phone that looks like phones and devices already on the market. That type of thing. Good to see apple getting a taste of its own medicine. Lame patents are lame patents, no matter who registers them.
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post #39 of 45
5/13/11 at 11:38pm
Quote:
Originally Posted by Nairb View Post

You mean something that is not innovation like pinching to zoom, portrait and landscape docking, the shape of a phone that looks like phones and devices already on the market. That type of thing. Good to see apple getting a taste of its own medicine. Lame patents are lame patents, no matter who registers them.


Of course the difference is one company is trying tom protect aspects of a real product and the other is trying to extort money from small developers.

Apple,Goole, and even Amazon all have a vested interest in crushing this particular troll.
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post #40 of 45
5/14/11 at 7:41am
Quote:
Originally Posted by josephwinters View Post

Doesn't this seem a big odd? Going after the developer? Wowzer. Probably due to the fact they know legal action with the smaller people would be less of a struggle than dealing with apple and their billions?

So odd.

It seems to happen regularly. Some things I've seen, I think the SCO case in particular, and some other cases, where the company can take their settlement money and use it to move on to larger targets. It makes perfect business sense, though this is more predatory litigation than anything else.

Quote:
Originally Posted by stelligent View Post

It is a strategic move to sue developers and not Apple. Apple is employing the same strategy by suing HTC and not Google. Go after the weak link in a chain first.

I think there is a false equivalency here. HTC isn't some tiny developer with less than a dozen employees. HTC should be able to easily defend themselves. I also recall the issue of whether Google is directly making money on the Android platform muddies the waters, their benefit is reasonably indirect.
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