Red Hat, Rackspace win early dismissal of Uniloc patent suit

It's not clear whether Uniloc, which has sued many other tech companies, will appeal the judge's ruling

Red Hat and Rackspace have won an early dismissal of a patent infringement claim brought by Uniloc, in a decision the companies are hailing as a potential landmark in intellectual property law.

Unlioc had sued Rackspace in June 2012, saying that the Linux OS violated a patent Uniloc holds related to processing floating-point numbers. Rackspace uses Red Hat's flavor of Linux. The software vendor defended Rackspace in the case as part of its Open Source Assurance program for customers, according to a statement.

The defense filed a motion to dismiss Unlioc's claim, and it was granted this week by U.S. District Court Judge Leonard Davis.

Uniloc holds U.S. Patent No. 5,892,697, which contains 27 claims, but only brought the first claim into the case against Rackspace, according to Davis' ruling, which was filed Wednesday in U.S. District Court for the Eastern District of Texas. That claim "merely constitutes an improvement on the known method for processing floating-point numbers," and is not patentable, according to Davis.

"Even when tied to computing, since floating-point numbers are a computerized numeric format, the conversion of floating-point numbers has applications across fields as diverse as science, math, communications, security, graphics, and games," Davis added. "Thus, a patent on Claim 1 would cover vast end uses, impeding the onward march of science."

A Unliloc spokesman didn't immediately respond to a request for comment on Davis' ruling.

Uniloc has many other pending patent cases against technology companies.

Critics have called the company a nonpracticing entity as well as the more pejorative term "patent troll," which is meant to suggest Uniloc's main purpose is to collect patents and file intellectual property lawsuits in search of licensing fees or damages, and not to develop actual products for market.

Uniloc "is in the business of finding big ideas," according to its website. "We have focused on technology that is incredibly complex to develop, but elegantly simple to execute."

Its primary patent, U.S. No. 5,490,216, focuses on software antipiracy. Uniloc sued Microsoft in 2003, alleging that antipiracy features in Windows XP and Office XP violated its patent. Uniloc initially won the case and was awarded $388 million, but a judge later overturned the decision. Uniloc is appealing.

The company is unapologetic about its legal actions.

"Uniloc plans to defend our patents aggressively whenever they are infringed," states a question-and-answer page on its website. "This protects our business and our shareholder value. In our view, it's the right thing to do."

Red Hat and Rackspace hold a different view.

Patent suits like those brought by Unlioc are "a chronic and serious problem for the technology industry," said Rob Tiller, assistant general counsel at Red Hat, in a statement. The judge's ruling "set a great example for future cases," Tiller added.

The early dismissal "delivers a clear message that patent assertion entities can't expect quick settlements on weak claims, a tactic many patent assertion entities use to monetize questionable patents," Rackspace general counsel Alan Schoenbaum said in another statement.

In addition, Davis' ruling has set a potentially important precedent, as it is the "first reported instance in which the Eastern District of Texas has granted an early motion to dismiss finding a patent invalid because it claimed unpatentable subject matter," according to the companies. The court has been viewed as overly favorable toward plaintiffs in patent cases.

Chris Kanaracus covers enterprise software and general technology breaking news for The IDG News Service. Chris' email address is Chris_Kanaracus@idg.com

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Tags business issuesInternet-based applications and servicespatentCivil lawsuitslegalsoftwareRed Hatcloud computinginternetrackspaceUnilocintellectual property

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