In America, when people invent things, they expect their trade secrets to be protected by
federal law when their government patents are approved. However, that isn’t always the case.
Patent infringements are life and death for inventors especially when their ideas are
incorporated into products made by larger and better financed competitors who avoid paying
licensing fees. Too often the originators sue, run out of money fighting off competitors, and simply
Until recently, our courts have been little help to patent owners. However, an obscure
Patent Trial and Appeal Board (PTAB) provides new hope for the small guys who worked tirelessly
perfecting their innovations.
The PTAB was formed in 2012 to implement the American Invents Act of 2011, a measure
passed by Congress and signed by President Obama. It consists of three members who rule on
patent infringements. It has been frequently criticized as a tool of major companies; however, the
game-changer is its unanimous decision favoring Voip-Pal. Its patent granted by the U.S. Patent &
Trademark Office was infringed upon.
Mike Flynn, retired publisher of the Puget Sound Business Journal and author of Flynn’s
Harp column, investigated the issue after learning the small Bellevue technology company won a
landmark PTAB ruling which could lead to multi-billion-dollar patent infringement settlements
from huge corporations such as Amazon, Apple, AT&T and Verizon.
Flynn found that Voip-Pal.com has a suite of patents on technologies dealing with what are
known as “Voice Over Internet Protocol” and has filed $9.7 billion in lawsuits against 60
companies claiming they are infringing on its patents.
Amazon is the latest tech giant to be sued by Voip-Pal. Voip-Pal alleges Amazon’s Alexa
calling and messaging services use its patented technologies to direct voice and video calls and
messages without licensing agreements.
In fact, according to Voip-Pal president Dennis Chang, Flynn wrote, “we could make an
enormous amount of revenue just licensing our patents since people have been infringing for
Flynn also interviewed Voip-Pal CEO Emil Malak who believes the PTAB has finally put
some teeth into patents. “I fully expect that infringing entities will either license or acquire the
Voip-Pal technology bringing major returns to our shareholders.”
Malak said the suit against Amazon came after investigating the Alexa platform and Echo
line of products which Voip-Pal technicians found violated its patents.
Malak told Flynn: “We had the vision that within 10 years, the Internet would become the
primary means for telecommunications and realized that, in the future, calls, media and messages
would be primarily routed using the Internet, with a seamless transfer to cell phones, landlines, or
computers where necessary.”
It was a revolutionary idea at the time, three years before Apple’s Steve Jobs unveiled the
iPhone. “At the time most people were making calls using landline-based or cellphones, with
information traveling over phone lines and cellular networks,” Flynn wrote.
Despite the grumbling from the federal judges, the PTAB decision has received no media
attention. It is a “non-appealable” verdict.
The American Invest Act in 2011 was intended to transitioned U.S. patent law from a “first
to invent” patent system where the priority is given to the first inventor to “file a patent
application” to a system which has tended to benefit large companies.
Malak now believes major tech companies may decide that it is more logical financially to
pay licensing fees to Voip-Pal than to face treble damages if the infringements continue.
The Voip-Pal decision has sweeping ramifications. Hopefully, Congress will act to restore
patents as property rights and give startups a better chance to protect their property from entities
which have greater resources.
Don Brunell is a business analyst, writer and columnist. He retired as president of the Association of
Washington Business, the state’s oldest and largest business organization, after over 25 years as its CEO
and now lives in Vancouver. He can be contacted at TheBrunells@msn.com.