Why Are You Not Happy Avigilon Slayed The Troll?

A patent troll is a person or company who enforces patent rights against accused infringers in an attempt to collect licensing fees, but does not manufacture products or supply services based upon the patents in question... Wikipedia

In the 2000s, OV used to tout how many video analytic channels sold worldwide (700,000, 800,000, etc.) but they have long since stopped that. We have not heard of anyone using or buying OV's software in recent years... ObjectVideo Revenue Breakdown

The implication is clear, ObjectVideo once a thriving video analytic software provider had morphed into being a defacto troll. And quite an aggressive and successful one at that.

Yet news of Avigilon's slaying of the troll was primarily viewed as a negative development.

And while understandable that Avigilon's competitors need to evaluate this development as it may pertain to them, there is good reason to be sanguine, at least for the industry at large.

Because the 800 pound troll is gone. Who cares you say, "6 of one, half-dozen of another".

But it does matter for this simple reason, unlike ObjectVideo, Avigilon is vulnerable to counter-claims of infringement, seeking damages from lost sales. This is a common move used between rival non-troll patent holders, but this is only an empty threat against OV.

Since ObjectVideo apparently had little in the way of sales, they had little to worry about in terms of damages and injunctions. With Avigilon, on the other hand it would be a different situation.

Consider also the fact that before the acquisition, if ObjectVideo and VideoIQ had concievably overlapping patents, nothing would preclude both patent entities from suing for essentially the violations.

Lastly, competitors should keep in mind that 80 million dollars is not a trivial sum, and Avigilon now has 80 million less for R&D and business development, and the industry has one less troll...


"Because the 800 pound troll is gone."

Except Avigilon is far scarier than Object Video.

"Unlike ObjectVideo, Avigilon is vulnerable to counter-claims of infringement, seeking damages from lost sales."

Are the rival manufacturers going to do that? Their track record suggests not.

And Avigilon's track record suggests that they will exact as much power / value out of this that they can.

"Competitors should keep in mind that 80 million dollars is not a trivial sum, and Avigilon now has 80 million less for R&D and business development"

I am pretty sure competitors would have been far happier to see Avigilon spend that $80 million on an intrusion manufacturer, PSIM, retail analytics, etc. All of those are from the standard conglomerate playbook and are easy to deal with.

A manufacturer in this industry buying a patent troll is unprecedented and, with Avigilon's history, a scary proposition.

Are the rival manufacturers going to do that? Their track record suggests not.

I think your missing my point; the 'track record' that you speak of is non-producing entities, i.e. trolls, suing manufacturers/integrators/end users who quickly settle, am I right?

This is different. This would be major manufacturer suing major manufacturer, where each ones main business is not patent licensing, and therefore neither is as likely to jeopardize that core revenue. Unlike a troll who has nothing to lose except legal fees...

Also, wouldn't you agree that Avigilon is far less likely to sue an end-user or integrator than a troll like Hawk, because of the animosity it would generate with prospective dealers and users? Even when suing a manufacturer, a negative perception is created, to some degree turning off prospective customers and reducing goodwill.

Where the troll can be viewed as a troll with little impact.

Do you have any examples of large manufacturers suing large manufacturers in our industry that we can look to?

The more important historical pattern is the last 5 years of the video surveillance business.

Avigilon is like a honeybadger. The other big manufacturers are like poodles unfortunately.

Avigilon has eaten so many of these big manufacturer's lunches for years and the others have done nothing.

What are you suggesting is that, all of a sudden, the manufacturers are going to get aggressive in combating Avigilon. Based on historical patterns, I believe that is optimistic.

Moreover, Avigilon has never been one to show any mercy to rivals, employees, integrators that don't deliver, etc.

Avigilon will absolutely threaten to sue manufacturers and end users. From their perspective, surely there will be nothing wrong with that. They will assert that they are the legal property owners of the underlying technologies to video analytics and that they are the ones being abused by rival's actions.

For example, a priority for Avigilon is enterprise deals, where video analytics are often a key component. I don't think Avigilon would have any qualms letting both the end user and their rivals know that the rival offering violates their patents and would be subject to legal action. It's a legal and a strong tactic to sway large accounts.

So, to close, no, I don't think Avigilon is worried about negative perception. They've never been in the past and, unlike a non-practicing entity, they will certainly take the position that they are simply defending their property against violators.

Granted your point that Avigilon is far more ruthless and far less concerned with perception than others. Also understood is that, although OV may have been as ruthless, they were not in the position to acutely leverage the IP as Avigilon is.

So I see the Scary Shadow too...

On the other hand Sony, Panasonic, Samsung, et. al., surely own patents that could be used against each if they so desired. What prevents them is not cowardice, but just good business, and this has resulted in a sort of nuclear detente.

If Avigilon were to reopen an old war wound with Techwin, do you think they would hesitate for a moment to counter-sue for their IP, assuming they have something remotely plausible? Where with OV they had little leverage and just had to sit on it, til they got a small victory. While others caved instead.

And so Avigilon just got the 'A-bomb'. But so do others. And though it makes no sense to nuke terrorists, (trolls), countries are easily found on the map.

So I'll water down my rhetoric if it helps, and just say 'look on the bright side', we are not just fighting a Shadow anymore.

I am betting Avigilon will push to see how far they can go. If rivals counter sue on their own patents, Avigilon can still choose to settle with those particular individuals and not have anything close to 'mutual destruction.'

The bigger threat for Avigilon is still a determined manufacturer who seeks invalidation of the core claims. However, as the Bosch / OV invalidation and the Axis / Cantelo invalidation process shows, if a patent troll/holder believes they are at risk losing there, they simply settle in exchange for terminating the invalidation process.

I still don't see much downside for Avigilon and I see a lot of upside, especially against smaller players, who have little leverage against them.

Speaking of IPR-201400394, did you notice that Avigilon had requested a stay in their own case with Cantelo, pending the outcome of the same IPR? Which was granted, maybe a month before the Axis dismissal.

Also of note was the patent board's stern rebuke of both parties for not following procedure by getting prior approval of their settlement from the board. The board was only granting the termination of the IPR because no interested party or public interest had expressed any interest in continuing it.

The patent board didn't indicate they knew anything of Avigilon's stay pending, and so it gives one the impression that Cantelo was trying to keep the request under the radar, so Avigilon could not argue for its continuance...

Final question:

Do you therefore believe that it would be in Avigilon's best interest to acquire any or all of the three remaining minor troll's portfolios, Canatelo, Hawk, Adrain, for the very same reasons they did with OV?

Don't give them any ideas...

I am sure they've thought about it and if the price was right...

Troll Scorecard -- Active Cases/Closed Cases

Hawk T.: 29 / 45

Canatelo: 1 / 22

J. Adrain: 5 / 17

I think the term is MAD "Mutual Assured Destruction"

John:

Would it be possible to post samples of the troll letters (with appropriate redactions) that have been sent to customers and integrators?

Avigilon slays (or pays) another troll.

Best line from the Avigilon response to the Adrain complaint:

Avigilon admits that Plaintiff purports to allege a claim arising under the patent laws of the United States, Title 35 of the United States Code.

Puports to allege a claim? Who said lawyers are overpaid?

So are we happy now?

Not long ago I spoke to an IP lawyer and expressed to him concerns about the behavior of a particular large corporation that boasted owning 500+ patents that actively sued other companies, including small business. He told me: "there is no point having a large patent portfolio if you are not going to sue". It doesn't matter if the company that sues you is a troll, or has a product, if you're a small company, you're still screwed.

It doesn't matter if the company that sues you is a troll, or has a product, if you're a small company, you're still screwed.

Agreed. And the smaller you are, the worse you are screwed.

The only thing balancing that is that the smaller you are, the less the award. As long as the patent holder is not desperate themselves, and is not a pure IP company, they won't be interested in smashing every tiny coconut around for a drop or two of milk.

Hopefully that continues...

the smaller you are, the less the award

So if you are a small company, is it better that the patents were owned by OV or Avigilon? OV was probably less likely to sue a small company if the reward was too small, but Avigilon could be more likely to use its patents in some way against that same company if they find themselves competing for the same site.

...but Avigilon could be more likely to use its patents in some way against that same company if they find themselves competing for the same site.

More likely, sure, as OV had little left of their non-patent business by the end.

Again, to actually make a lawsuit profitable, it would have to be a pretty big job.

Of course that doesn't mean they can't bluff and bully a smaller company into some agreement, esp. a smaller camera manufacturer.

Or do you see a threat at the integrator level?

Or do you see a threat at the integrator level?

I wouldn't know. I got the impression that if it is a U.S. manufacturer, they go after the manufacturer. If it is an overseas manufacturer, they'll go after whoever imports and sells the product in the U.S. But then again, in the U.S., anyone can be sued for anything by anyone...

And the smaller you are, the worse you are screwed.

That part I don't agree with. A small dealer will just fold up and pop up under a new name. They have little to no assets to attach. With a stroke of a pen, they go out of business and create a new identity.

But say you are a small manufacturer who has invested a couple of years creating a product and an identity. I don't think you could get out of a patent lawsuit quite so easily.

If you believed that Avigilon was actually going to sue you, at that point your best option might just be to pay the troll toll.

I don't recall OV licensing any super-small manufacturers, maybe the smallest was Aimetis.

Yes, the best option is not to infringe or as you say, pay the license. But I don't think they have to license the patents to you?

Short of Avigilon acquiescing to a FRAND, no.

It's a hypothetical problem for me at this stage, but does any one know the approx. cost of licensing a typical patent in the U.S., in this industry?