 appreciate everybody being here. This is kind of reprising something that we did in Austin and what we are doing is kind of living in the context of the history of open source of what's happened in terms of litigation, what's happened in terms of threat and the menace of patent litigation that existed 20 years ago and we'll talk about how threat is evolved and what we're doing in a very specific way to deal with is where threat is most acute right now which is with non-praxing entities, patent assertion entities, patent trolls, entities that that don't have the same mindset and are not influenced by open source in the way that operating companies like Microsoft that has made an amazing transition over the last five or six years in particular are or were influenced to become more community oriented and more focused on living within the confines of the community in terms of code of conduct set of norms that are now considered to be ingrained within most of the companies that live in that come from the operating space and so we'll basically Karen Copenhavers here I'll have Karen introduce herself and kind of her historic role and Justin will introduce himself and then we'll have Sean from Unified Patents introduce himself and then I'll talk a little bit about context of where we are why we're here and and then what operationally is going on that allows us to mitigate risk in a very precise way against very potentially damaging patents that are held by non-praxing entities that's going to be the primary focus of the discussion today and if you have any questions don't stand on ceremony just ask them just raise your hand or just blurt out what you want to say we're very happy to have a an open an open dialogue with you like any environment we get energy from your questions and from your interest in the things that we're doing this is our day job is to clear risk to make sure that the space is safe for adoption and to encourage more and more projects to be launched by Linux Foundation and other organizations in the world that are very successful and have been very successful over the last 15 years in particular and in being the authors and managers and professional professional advocates for for very significant projects in the open source world Karen talk about your historical well I have been working with open source since the late 90s and working with the Linux Foundation from the beginning and working with OIN from the beginning as well and aware of what they were doing and first I want to say that whenever I talk about OIN I fear that I am going to reduce its its role because I'm trying to be simple about what they're doing I one of the wonderful things that Keith has brought to OIN is a flexibility and a an opportunistic way of approaching risk so whatever I say is very simple realize that there are many layers of other things that Keith has been doing over these years to address risk and this is one terrific example of how we've taken a new step but what if you if you think about open source as you know from the very beginning they they were worried about patents you know as you read the GPL you know they were worried about patents the right approach with with patents at that time was to build a community of really patent owners who were dependent and vulnerable to to each other because of their dependency on these open source projects and of course these companies had owned and and felt the risk for patents for many years that was a slow process I think ideally it was addressed through the separate organization that could bring a level of patent savvy and a connection with people within the corporations that had a deep knowledge of patents the value of patents what was happening with patents and it's just astounding how successful Keith was in building that community response to patent risk that was the essential thing that he was working on as he built these licensees built familiarity and the benefit of that was that as new industries came in to open source they could see what was what existed they could see the level of support it was apparent you could look at the licensee list you could look at the success you could look at the sponsors and that more than anything else could allay their fears that this was such a different business model that weren't they a little bit reckless if they joined in so when you think about industries that came in later industry particularly like the financial services industry etc the existence of OIM the community response to that risk the sophistication of the approach to patents the collaboration among all of those parties was fundamental to their coming in to to open source and it was I think it was perfect that it was separate from the development work because they're actually a very different people involved in that so now we come up and we say say where you know where we are today all of that time the developers not the corporate patent owners but the developers have always wanted to address the problem of patents at its base that there are patents that were issued for software that never should have issued that you know that there was an approach to patenting that was ad hoc at best in the beginning and those patents still exist and are getting transferred and what I love about what we're going to talk today is that now we go back and address this fundamental concern that the developers have had from the beginning and the Keith through providing this collaboration as among all these companies has been able to bring companies together to fund this work by some of the most sophisticated patent attorneys on earth in terms of addressing these issues so I'm thrilled to be here and it's it's it's a long path to this this wonderful outcome so hey I'm Sean I co-founded a company called Unified Patents and Unified Patents has been around for actually almost 10 years now and we largely started because of a change in the patent system in the United States but going backwards as as she was saying patents have been around obviously for a very long time and they have a very important policy issue or solution is what they're trying to do is encourage disclosure and in exchange for that disclosure you get kind of exclusivity for a certain amount of time the problem has been over time especially in the tech space that there's been a strong incentive to get as broad a interpretation of your patent as possible way beyond what you actually invented and a lot of times that means that the patents are not valid which means that you know there has been prior art as they call it that exists that covers a lot of the patent that you're getting you might have started out with something very specific but you end up with something broad because that's what everyone's goal is generally because you want as much real estate as possible and especially in the tech space that happens frequently and what that means is that there's tons of patents out there that have pieces that are not very valid because there's other people who had those ideas before them and that happens in standards it happens in open source it happens in tech all over the place and usually don't know that for many years later now in the past you know 20 years ago that didn't really make much of a difference because most companies basically just kept their patents kind of like an iceberg in their portfolio and they just kind of traded them back and forth and that just kind of existed in and of itself and no one really cared but starting about 20 years ago what happened was that iceberg kind of like global warming kind of started melting and people started selling these things to different people and not just to other operating companies but to what they call non-practicing entities as well and these non-practicing entities went out and then they started essentially suing people in order to reap you know the money from it and there's an inherent in asymmetry in that market because the cost of litigation and even to find out of a patent traditionally was invalid was really high it would cost sometimes millions of dollars to prove that in court in the United States and there's a lot of risk associated with it because you're talking about very specific a language that frankly even I sometimes don't understand what's being read said in these things and you're asking a jury or a judge to figure that out so you don't have a very clear idea and you know you're asking people who don't have a very clear idea for results on something like this so you get all kinds of random results and uncertainty and so these non-practicing entities are working on kind of what we call an asymmetry in the marketplace which is you have a lot of uncertainty and you basically end up in a situation where you're spending a lot of money and you might not necessarily know what you're gonna get at the end even though you might do a great job or try to do a great job so most of them settle that's just generally what they do and so what that resulted in was this like huge increase in litigation especially in the patent space in the United States for non-practicing entities that were essentially buying because you can just assume that there's an unending supply of patents in this world that they can use because it's just everywhere and everyone is willing to sell them for very cheap at this point and they ended up suing to the point where about 95% of the litigation in the United States even to this day in the tech space is non-practicing entities at this point and most of those patents if they were challenged would loose in a challenge but just it's just not economically viable so there was a change in the system and the change basically made it easier to essentially invalidate patents and so Unified kind of got created in that process about 10 years ago to kind of help what we call deter kind of invalid assertions by non-proclaimed entities to stop these kinds of invalid assertions from happening now if you have a valid patent that's completely on point and you know you there is no what they call prior art on it anyone should be in our opinion should be able to monetize it any way they feel like wherever they feel like but the unfortunate truth is that most of these patents are not very valid and they're just there but no one actually expected to monetize them and suddenly you have someone who is and they consume not just one company but 20 companies and most of those companies don't want to spend the money in so they settle so that's the asymmetry that they end up making money off and so our job is to go out identify these non-practicing entities in the areas that we protect our members pay us a subscription fee for this for the areas that we protect and we basically are intending to deter these guys from actually buying these patents in the first place and by saying to them hey listen if you're going to invest in a patent either invest in a valid one that you know for sure is going to survive any challenge since we're not going to challenge it if we can't find anything bad on it or no one else will either or be just go to a different area and buy stuff in a different area that has you know valid patents or whatever but just don't buy it in this area essentially and don't try to assert it because these guys are making purchase decisions investments just like you invest in real estate they're buying intellectual property and then they're monetizing it through law firms so that's what we did and then we started talking to Keith and the Linux Foundation because what we did notice especially in standards and in other areas like open source that there was an increase in assertions and that's primarily because of the success of open source frankly speaking you know as more companies implemented open source code in full implementations and weren't customizing them them as much as they were before and they were just taking the packages and they were putting it in there and they were kind of touting it as something that made they were compatible with you know like a kind of COVID you know they would just latch on to that you know a patent role would or non-practicing entity we call a patent role by the way my definition because a lot of people have different ideas what about our definition or my definition of a patent role is just a non-practicing entity that's asserting what we believe is a bad patent that's that's a very simple way of thinking about it and so when I think of a patent role they're like latching on to that technology that they see everyone advertising and they know then they can go after a large swath of companies at the same time and survive long enough that they can get settlements from them and that's kind of their basis for doing it and so we saw an uptick in kind of open source specifically because it was getting more and more popular so we went to Linux Foundation and we went to Keith and we kind of in OIN and said listen this is a problem we have these other areas that we've done can we do something here is there a solution that we can work with you on here and you know we talked back and forth we had done some invalidity essentially analysis in the past and invalidated a few open source patents just because it was tangential to some other technologies we were protecting for example but we started talking about what we call creating a zone so we created an open source zone specifically for this area and it's a little unique because it requires a little more complexity first of all it covers a lot more companies than we're typically used to because we're including everyone in Linux Foundation everyone in OIN basically for everything so it's a much more complicated picture typically we would settle these cases in some cases and we would just pull the kind of invalidity in exchange for a license for all our members but practically speaking that's just not possible when you have you know 10,000 companies involved that you're settling with because no trolls gonna want to do that because they're basically limiting every single company from you know it get taking a license at that point so first of all we have to go through the whole process of invalidity it's like going to trial for the entire time so there's a cost associated with it which is quite a bit the second thing is takes time and you know we got to make sure pretty sure that you know you're gonna win luckily we're pretty good at that we win like every time we touch a patent we win 19 out of 20 times so we're pretty good at doing this once we touch a pattern you know but you know to get to that point takes a lot of time preparation so we have different processes for that we actually crowdsource which is really great so we have a whole solution around crowdsourcing which is a lot cheaper than just killing the patent or eliminating kind of that area we basically can go out and we can kind of reduce the risk by basically just publishing prior art on it so everyone can see it so there's no question about it and that actually solves a lot of problems too in the process because we can basically you know show that the through prior art and publish it without having to go through the whole process of actually going to court and showing that the patent is bad we can actually deter a lot of companies from actually asserting it and eliminate their ability to have leverage because a lot of time it just takes a small company or large company a lot of money just to find out if a patent is not that good in the first place and we do that work for them and then we publish so people make money off of it because they have you know they get thousands of dollars and rewards and we basically can publish this information so we do that and then we also you know eliminate it and ultimately the goal of all of this is to deter kind of assertions in this space and so we're constantly getting feedback from our members including OIN including Linux Foundation including anyone else who wants to give us information and we get demand letters and all kinds of other things in this area and then we you know collect that information and make sure that then we kind of find patents that aren't you know very good and then we publish as much information or we challenge them and ultimately our goal is to say to these people who are making purchasing decisions just don't do it just not in this space if you're gonna go out and buy a patent make an investment decision you know go buy real estate or something like that but if you're gonna buy it in this space it's probably not gonna work out really well as you thought because it's gonna cost you a lot and you're probably gonna lose anyway so that's and that's kind of what gets done Karen did you have a comment Justin yeah Justin can you explain kind of Justin's come from talk a little bit about your background because you're not a born and bred Microsofty and I think if that's very useful in terms of perspective talk about kind of a little bit about your history and then tell us about you know why Microsoft is is it been involved in co-founding this the zone with the rest of us here and what the what you know how it's how it's viewed as an activity within the portfolio of activities that that Microsoft's involved in about how the patent buyers are serving against free open source software community back when I gave my career the software freedom law center and you know it I moved my career in the patent litigation you know there was no greater joy for me than invalidating a patent on on various grounds when they were searching against against my against my clients and then you know fast forward a little bit I always maintained a large phobono practice in the free and open source software space and I remember Karen Karen Covain were actually worked across the street from me and we met for lunch one day and she said hey there's this job opening over at Microsoft via free open source software and I said Microsoft you really think I should go there and she said well they're kind of changing a little bit and I said to myself well you know Karen thinks so that maybe I'll give them a shot and this was you know five years ago 2017 you were kind of just starting to change and is the way I put it at Microsoft and so I came out here met the folks and I realized that they were they were pretty serious about about you know coming and and doing some real free and open source software work so you know I took the job even though kind of my initial impression was you know kind of yeah right Microsoft what what tricks are you trying to trying to pull now you know low and behold within within a year of my joining Microsoft had joined OIN and you know for from my standpoint that was a shock because OIN in a lot of ways it's no secret you know Microsoft and and the free and open source software community were a little bit of at odds in the past and in particular you know with respect to with respect to patents and so the idea that Microsoft you know so quickly would come and join OIN with the idea of creating this safe space of real collaboration between large companies and the free and open source software community more broadly to say look hands off this stuff this stuff's really important and if we want to promote innovation then what we need to do is we all need to agree that these packages the Linux system definition which is at the heart of OIN Linux kernel and and many of its packages and language ecosystems that that should be free for people to use and to innovate on and we should all kind of come together and agree that that should be a safe space and so and so I think it's just a natural evolution thinking about you know this OSS zone from Microsoft to support that additional safe space so it's not just so it's everybody's kind of come together and agree look this is important stuff we shouldn't be touching it but then all of a sudden others have come in these you know people not not a non-practicing entities have come in with patents that bought on the open market and said hey you know we really think you should be paying us for that if you're using Linux or you know something in the Linux system definition or open source and the response is kind of like you know no this is really important stuff and we all need to do our part to make sure that innovation isn't stifled because of these low-quality patents that are coming and being asserted so I think the it's just a kind of a carryover of this idea of having a key safe space to drive innovation on this really important baseline technology that that has really shown the world that innovation can be done in the open and we shouldn't be holding it up thanks Justin I think it's really important that we think about the journey of how we got here 17 years ago model ethic threat Microsoft was I'd say beyond testy they were openly aggressive antagonistic looking to slow install the progress of Linux and open source and so that's the world that I entered into when I came to run OIN IBM Red Hat at the time Novel Sony NEC Phillips had gotten together to fund this later Google and Toyota joined as funding members and the whole idea was to have this paternalistic model where you didn't have to pay anything but what you had to do was put your core patents at risk in a cross license along with everybody else so you give as good as you get and we neutralize the risk around what is absolutely fundamental coming at fundamental technology coming out of the the most significant projects in the world and then to be able to have this unique capability of expanding the scope of the license which for those of you who've done licensing it's it's never been done before that you can have a successful license where the license or has the ability to expand the scope of the license without approval of the licensee but what that's a testament to is the unusual nature of the open source community and the trust that the community developed and the members now we have 3,750 members it's the largest patent on aggression community in history all these members are buying into the notion that we are going to act within their interests to be able to expand the scope of the license to reduce risk that's that's represented by community members and that's we've we've we've supported adoption that I remember talking to Jim Zemlin 13 years ago 14 years ago he was talking about you know kind of not moving beyond Linux but basically allowing for more entities large and small to come together to be able to support new project development to professionalize at scale project management and that obviously with 380 plus projects or any projects Linux foundation has they've been very successful at doing that but one of the the pathways to do to do that one of the choices that was made was to largely almost exclusively use permissive licenses permissive licenses that don't have a lot of patent integrity in terms of protections and so OAN became a natural partner of Linux foundation to live in the slipstream Linux foundations the creativity of the project participants as project core code came out we would protect it put it in what what Justin described as a Linux system definition which is the zone of patent protection and that project could the people who are participating in the project can feel more comfortable about adoption one of the problems 17 years ago was large companies were not comfortable participating in an open source at scale because they were afraid of patent risk litigation a patent risk largely associated with litigation and Microsoft was waving its flag about you know don't don't come here because we're going to sue you we've got lots of patents low and behold as Justin described GitHub acquisition is one of the facilitative elements but clearly with leadership like John Gosman and Tyler Fuller who are completely authentic individuals inside Microsoft whom I've gotten to know and it really felt this sense of embrace from them because they have in essence they and a handful of other people have helped turn an organization around that was very much focused on on the notion of antagonism and taxing and raising the cost of ownership of the use of open source and so it takes change leaders like that to be able to affect this kind of change in the most successful proprietary software company in the world so that's no mean feat that they have made this shift and it it comes from the top down through the CTO and throughout the organization now and so it's the journey of redemption as I call it has been a has been a wonderful thing to watch and we have been we have been a partner in the in that journey probably no more single act other than the joining OIN and exposing all 62,000 of its patents to cross license driven by OIN which had been set up really to counter the effect of Microsoft in the in the in the patent space this was a sense of of of a new reality that we were we were participating in but what that also meant is that we could work with Microsoft we could work with IBM we could work with other companies and the LF to be able to solve problems that existed that were beyond the Microsoft threat because now we had a clear space and it's what happens after what comes next and what happened is that we recognize that where the where the threat was going where the risk was going and I'll have Karen talk a little bit about the protections Sean touched on it but the protections that that are unique to how this zone works relative to the other zones because there are 12 other zones that these guys protect met is also a supporter of this zone and a couple of other companies so it's not just us but there are some others but Karen negotiate on behalf of the LF as its attorney to make sure that that there was awareness by by unified of exactly who we who we need to protect we don't we don't leave people behind or separate and create a hierarchy of value in the open source world when we do these kinds of things and I think it's a very important point that I'll have Karen talk about them I'll talk about it briefly then Sean you can talk about how it works in practice but this was different I mean this was so different and the idea that these companies would come together and do something once again that they could not do on their own I mean any one company undertaking the work that Sean's company does would not have worked as well if it had worked at all and the exposures that would have come from individual companies taking these actions and would have certainly slowed things down as they had to think about all the ramifications to every company of what was going to happen so to have this independent organization make these decisions and to you know look out for the entire zone for the entire what was in the open source zone and do that without having to go negotiate with anybody I mean it's you know they they don't go and talk to six companies and say do you really want me to do this in fact that's completely against everything that they can and should do but they were able to move quickly in the patent space because they were given that freedom so that's one thing that's really different but I think what Keith is talking about is that when we looked at the law at the standard license for for the zones that they work on these are companies that step in and pay money in order for their area of technology to be looked after by unified and so those companies that paid to participate are the ones that would potentially get a license if if something was settled and so settlement was I don't know if it wasn't a common option but it was a possible option it in that you know you would have these are the companies that would that would end up with a license if we settle this out it's a lot of companies but it's here's the here's the companies that would get the license we can make this all go away you know with you the the the patent role if you know if we can settle this up well you know I came and said you know I I don't feel great about that because we don't get licenses for part of the community you know if you if you negotiate a license you really have to negotiate a license for everybody we can articulate and it's and it's difficult to write down everybody you would want to get a license you know so we wrote down as much as we could think of and Sean I'm not sure whether it's time you at the time or I was talking to somebody else that said you know this eliminates settlement as an opportunity I mean how could I possibly negotiate a settlement with this with this set of licensees so this means that I go to the mat on everything and we said that's that's okay with us that's okay with us but it's it's an order of magnitude more in terms of I think what we handed you as an assignment because we wanted to make sure that this was seen as being entirely supportive of the community so once again oh I am is building this community of support with with all of these licensees to bring everybody in the people who are here now the industries who are coming it's all about bringing everybody together to focus on a response and if you limit that response to a specific set of licensees it really works against the concept that this is a community response so I don't know how hard we made your life but I remember when I first mentioned how many licensees they were going to be it it it it wasn't it wasn't it wasn't intuitively obvious to you that that was the right answer well I mean we always like new challenges there's there wasn't a solution to you know the interesting thing about patent trolls I would say is they're actually very rational creatures they're actually one of the most rational teachers you'll ever see in the world because they're really only special purpose vehicles to make money that's really why they exist in the first place they buy a patent then they asserted against a bunch of companies that they've already determined they can go after and they have kind of a you know usually a spreadsheet with a very nice you know flowchart of how they would expect things to come out with an expected recovery amount at the end of it and an ROI associated for their investors just like any other kind of financial plan but there's no people involved it's just purely about asserting patents and settling you know in the end so it's just about making money which you know is negative and positive because they're completely rational when it comes to settling too the numbers that they you know want to settle for are based on just getting the financial reward it's nothing that they think personally about the patent or you know the invention or what's going on with the company or anything like that so in just to clarify like we we have actually as a standard member at Unified and you know any small company can join as a standard member and they actually do get the settlements too so like paid and unpaid get the settlements in any zone for example that they participate in and and so like companies that are under for example 25 million in revenue at Unified can always join for free and they get all the same benefits of the large company that join the same zone and the idea is that everyone should benefit and the small guys just shouldn't you know get asserted against in the first place in our opinion but secondly ultimately it's all about the turns and ultimately the goal is really to say like we're not going to allow any of these kinds of assertions to happen against anyone because if it starts with one company it's just like a rolling ball once they get one settlement then they'll get a couple others and a couple others and a couple others and so our goal is to nip it in the bud right before it starts like even if they're not asserting against a member or you know what's important to us is to make sure that we stop it at the source because once it goes down that route of getting settlements it's too late a lot of the time and a lot of times they smart start with small companies they might start with a really small company who like will you know contact us and go what the hell's going on like why do they come in bad luck so we we like to do that and they do settle quite often actually about a third of the time that we actually challenge a patent and a non-practicing entity or troll will settle with us which actually surprised us initially but kind of made sense in the end because we realize that they are rational in the way they think about things but on the other hand when you have such a large community of companies and such a large swath of technology that becomes a lot harder but it's okay because in the end the goal is really to deter that's the goal ultimately and you know when we file for example and challenge patents which we do regularly in open source we know and they know that it's not going to go away anytime soon that's that's that's part of the goal to say it's going to cost you a lot of money so just like they kind of go to companies and say hey it's going to cost you a lot of money to figure out whether this pattern is bad you really want to do this it's going to take time away for your engineers and for you to do other stuff and you're going to be thinking about it all the time and pissed off about it all the time why don't you just give me a little cash and I'll go away and then you can just go on your merry way and we won't have to think about it we kind of can go to them and say basically exactly the same thing usually and there's nothing they can do about it and you know that's that's the great part is we can go to these guys that really don't have a natural kind of you know I would say you know person that that's a counterweight against them I guess you would say in most cases and literally tell them the same speech that they give companies that they're asserting against to them and tell them your patents not good this is the reason why do you really want to go through this it's gonna cost a lot of money to you and you're probably gonna end up losing it anyways in the end why don't you just either settle out or just give up and that just creates a lot of pressure on them that they normally don't have to feel just in terms of numbers and correct me if I'm wrong there've been like 30 plus wins that you guys have had against you know technologies that everybody knows you know whether it's a Kubernetes or Docker or or Hadoop or Kafka kernel technologies they're just a replete with wins that they've been able to record and chalk up and put on our side of the ledger and so these are situations where those patents are not being used to to torment terrorize and antagonize the community and we're winning the battle but this is a rifle shot this is about this is a an activity that's very focused on specific patents that represent a specific level of threat and so we're not just just sweeping out relatively unimportant patents or or just what we think are you know other areas maybe not so significant but we'll pick that one off this is like the core of seeing most of the significant projects that we see and so you know it's I think it's a very important win in terms of the collaboration that we've had to be able to support that we this is our third year of supporting unified and we see continued growth the continued opportunity because there's an attractive nuisance that's out there and it's PAEs patent searching entities that have patents that read on critical core functionality of the open source world I just want to say one other thing just you know just kind of me looping on something that that Karen was saying around how important it is that these type of protection extends to the you know the broader community not just you know people who are you know supporting the in order for open source innovation to work you need collaborate you need people who are willing to pick up the technology use it and then after using it you know improve it and so to have a settlement only benefit a few people in that space or a few companies in that space wouldn't serve that purpose one of the beauties of the innovation is that anybody can contribute and anybody can make an improvement that everybody can benefit from and that way Microsoft and others a Microsoft isn't the same you know shoes as any other user and any other collaborate or a lot of these spaces and so to make sure that this umbrella protection extends to that broader base really serves the purposes of exciting and incentivizing that innovation on this you know core broad technology that's a good point Justin I think we'll end on that point and if anybody has any questions I think we're over time already so if there any questions in the hallway we're glad to take them or if somebody wanted to give us a chance to to respond to a question now and we're collectively spending millions of dollars a year to be able to fight this fight so to your point and this is the most expensive because of what we describe these are the most expensive this is the most expensive zone per incident by far because they have to take all of these cases to term the other ones they're able to settle three or four months in they settle they're not taking them to term and so we have the challenge of protecting an entire community instead of protecting a club of companies so it's a very unusual horizontal zone as well most of them are vertical zones but this is across entire specs swaths of technology it's financial services it's it's you know security it's cloud it's everything it's telecom it's video it's it's everything that is near and dear to your you know your kind of companies future success is is is at risk here and so this is why we want to continue to invest in this with the LF with Microsoft with Meta and other companies that are in this but we want to see Mike's point this community grows so we can do more good things with our through our partnership with Unified so thank you very much for being here and listening to the story