Ep 61: Patents and the World Cup

June 30, 2014

Nasir and Matt attempt to do a World Cup themed episode, as they discuss the recent Supreme Court case about patents and answer, “If I sell items online, can I have them agree to the contract by checking a box that no one reads?”


NASIR: Goal! Welcome to Legally Sound Smart Business!
This is Nasir Pasha.
MATT: And this is Matt Staub.
NASIR: And welcome to our business legal podcast where we cover business in the news and also answer some of your business legal questions that you, the listener, can send in to ask@legallysoundsmartbusiness.com.
Welcome to our World Cup themed episode. Everything we’re talking about is World Cup. We’re not even going to talk about the law. It’s become a sports podcast only for today and only the World Cup.
MATT: I don’t know if you saw and I don’t want to get too off tangent but, well, I guess, from what you said, this isn’t off tangent.
We’re recording this the day after the US lost in the group stage but ended up advancing. I don’t know if you saw Denny’s when they posted something on their Twitter – how they were really sad that the US lost because they thought they were eliminated but they ended up advancing because they didn’t understand how the rules worked.
NASIR: It may have just been like an automatic thing. Like, if they lose, just automatically tweet this or something. But that’s kind of embarrassing. I wonder how they corrected that.
MATT: Yeah, only in soccer could you lose and the team that’s possibly take your spot could win and you still advance somehow.
NASIR: That’s not true.
MATT: I understand how it works.
NASIR: That is not true. No, no, no. First of all, the NBA playoffs are the same way, by the way, because you can lose a game.
MATT: What I’m saying is you can’t lose your last game in a certain round and advance in any other sport.
NASIR: Okay. Yeah, I can see that.
MATT: Yeah.
NASIR: That’s true. It is a point system but anyway what’s our first World Cup story for the day?
MATT: Well, I don’t know if this is World Cup.
NASIR: I promised everyone World Cup theme so we’ll have to tie it in somehow.
MATT: I’ll see if I can.
This comes from the Supreme Court in the United States who has made the World Cup Final 16s.
NASIR: That’s right.
MATT: That’s the tie-in. But it’s more patent stuff. It’s a topic we frequently talk about on the podcast because, you know, I think I can speak for both of us. We’re both anti-patent trolls and I think a lot of people are other than the few attorneys that are holding on to these patents and trying to make money off of it.
NASIR: Just to specify, I am anti-patent trolls but not anti-troll.
MATT: Okay, good to know. Good clarification.
The Supreme Court ruled 9-0 – a shut-out in soccer terms – basically saying that you actually have to make something in order for the patent to be legit. It can’t just be an idea.
We’ll post the link and people can read the specifics but, I think, overall, obviously, this is going to be a really good thing moving forward. We’ll see what kind of effect it has but this is a good step in the right direction.
NASIR: Yeah, I think it is, but I started actually reading it and seeing some of the commentary, it just seems like this was a bad example because, if you look at the actual patent, it was just very general and it had to do with some financial trading systems and this is actually a ten-year-old case in the sense that this has been developing for a while with multiple lawsuits. But, just to break it down in simple terms, the original patent was to patent an idea of how they do a certain financial analysis and let’s just do this financial analysis using a computer. I know that sounds very generic but, from what I’m reading, it wasn’t more specific than that and the Supreme Court just made it very simple that that’s not patentable. I think the criticism for this particular decision – or at least as far as the reaction to it – is that, in reality, it’s not going to do as much as people may think as far as changing the law, as far as combating patent trolls. In fact, some of the organizations related to fairness and patents simply state that there’s nothing that a court decision or an executive can do to combat patent trolls to make it not profitable to be a patent troll. The only way is to literally change the law. I can see an argument towards that based upon this opinion.
MATT: Yeah, you always have to go and do that. I try to say something good/positive and you just knock it down. But there’s truth to what you said and it does get into details about that. It is a step in the right direction just because we don’t see rulings like this. There’s just so much bad, it looks like in the patent world that to get one minor positive out of it, it’s finally moving towards the right direction and they’re trying to introduce legislation as well that will prevent patent trolls out there to do that. But, if this story was in the group stage, I don’t think it would have advanced to the knockout stage.
NASIR: I would agree with that. But, you’re right it is a step in a positive direction. It is going to make it more difficult for, like, the ridiculous patents out there. Like, there’s this one that the Electronic Frontier Foundation gave an example of as a computerized meal-planning so they sued a bunch of websites simply providing their recipes and menus online and that was a basis for a patent infringement. So, those kind of things obviously are things to… it just doesn’t make sense for that to be allowed and this decision will affect those types of patents.
MATT: Very true.
MATT: Let’s get into the question of the day. Hopefully, it’s World Cup related.
NASIR: And it’s not. I told everybody World Cup Day. I was very clear.
MATT: “If I sell items online, can I have them agree to the contract by checking a box that no one reads?”
This comes from… I was assuming they were selling soccer balls but it’s not, Wine Sales in Sonoma, California.
NASIR: Well, this is actually a classic question and we’ve all signed these agreements – well, I know I have. Matt, have you signed one of these agreements where you check the box?
MATT: Never been on the internet before but maybe one day.
NASIR: Okay, yeah, I’ll show you.
The pretty common, you know, usually, whether you’re registering for a new site, whether you’re buying something, sometimes, there’s not even a check box, right? Sometimes, it says, “By purchasing this, this is in accordance to the terms and conditions of this website” or “By registering…” et cetera.
So, here’s the rule, and I’m going to give the US rule because the rules in other countries around the world is actually much more restrictive and it’s a case by case basis but, basically, so long as the user understands that they’re agreeing to certain terms and conditions, the law doesn’t require them to actually read it and there has to be some kind of action of ascent or agreeing to it or acceptance to the contract. So, a checkbox is a great way to do that because it makes sure they actually have the opportunity to read. But, sometimes, for example, Zappos.com got hit with a lawsuit and basically the issue was whether this terms of service was enforceable. The problem is their terms of service was really buried into multiple links and wasn’t readily available so how could they actually prove that the buyer or the consumer actually agreed to those terms and conditions when they can’t really access it. It would be similar to giving somebody a piece of paper to sign and then having the agreement somewhere else. There has to be some kind of connection to the agreement and the signature.
MATT: Very true. The one caveat I would say with this specific person that sent this in is it’s dealing in wine sales.
MATT: I mean, they have to be extra careful because, obviously – assuming they’re selling wine and not just…
NASIR: A soccer ball.
MATT: I was thinking of the other things you could sell that are wine-related – like a wine rack. If you sell actual wine, you know there are other things that go into that as opposed to just selling a soccer ball. So, this person needs to be extra careful – I mean, obviously, make sure they have the right language in there – and I think what a lot of sites do – breweries and things like that – before you can even go on the website, you have to check and it’s ridiculous because obviously you can just lie if you wanted to but, like, enter your birthday or just verify that you are 21 years or older, that sort of defense looks like Portugal’s defense in their first match against Germany.
NASIR: Oh, this is my favorite World Cup episode, by the way, out of all the other World Cup episodes that we’ve done. That’s a great perspective. I didn’t even think about some of the regulatory effects it can have by selling alcohol online. I don’t drink so that’s probably why I didn’t think about that but definitely a good point.
MATT: You didn’t know what wine was?
NASIR: I thought it was soccer balls. I thought it was, like, French for soccer ball.
MATT: Yeah. Well, we both learned something on this episode.
NASIR: That’s good. What did you learn?
MATT: I learned what the internet was. Remember, I’d never been on it before.
NASIR: Yeah, it was invented by Al Gore.
All right. Well, thank you for joining us. That was a fun sports episode and good luck to the United States of America tomorrow. I’ll also be watching the Germany game today – today meaning not the day that I’m recording but the day that this episode is coming out.
MATT: It’s going to be that long until they play again? I don’t know if I can wait.
NASIR: Oh, till US? I think it’s tomorrow afternoon.
MATT: Yeah, I’m thinking real-time for when we’re recording this how long it’s going to be till that is.
MATT: It seems like a long time.
NASIR: Probably one, two, three, four days or so? Depending upon which planet you’re on.
MATT: Very good.
NASIR: All right, thanks for joining us!
MATT: Yeah, keep it sound and keep it smart.


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Legally Sound Smart Business

A business podcast with a legal twist

Legally Sound Smart Business is a podcast by Pasha Law PC covering different topics in business advice and news with a legal twist with attorneys Nasir Pasha and Matt Staub.
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