RFE&M Partner Quoted on FireStar Software, Inc. v. Red Hat, Inc. Case
July 7, 2006 – Linux-Watch

Rothwell, Figg, Ernst & Manbeck partner Martin Zoltick is quoted by Linux-Watch on the FireStar Software, Inc. v. Red Hat, Inc. patent infringement case recently filed in the U.S. District Court for the Eastern District of Texas. On June 26, 2006, object-transaction and business process integration company, FireStar Software, Inc., filed a lawsuit claiming that Red Hat, Inc.’s Hibernate 3.0 software infringes one of its patents. Red Hat acquired Hibernate, a Java-based object/relational persistence and query service, through its merger with JBoss, Inc., also a defendant in the case. In addition to requesting that the court order Red Hat to cease infringing its patent and to destroy all materials that utilize the infringing software, FireStar is asking for legal costs and triple the losses it has incurred in damages due to Red Hat’s willful infringement. The merger agreement between Red Hat and JBoss called for an escrow of $43 million to protect Red Hat against a breach of the representations and warranties, such as the representation that products do not infringe third party patents.

• "The timing of the lawsuit just after the acquisition by Red Hat of JBoss, and the venue in which the lawsuit was filed are significant. FireStar has positioned itself as the plaintiff-patentee in what is currently the most favorable jurisdiction in the country for patent holders (i.e., the Eastern District of Texas), and now has a much deeper pocket defendant-accused infringer as its target (i.e., Red Hat)."
• Zoltick expects Red Hat to fight the suit on the grounds that the patent is invalid. "The Complaint does not identify any 'evidence' alleged to support FireStar's infringement claim and, therefore, the strength or weakness of that claim cannot be judged at this early stage. With that said, however, I would expect Red Hat to deny infringement and to assert affirmative defenses and counterclaims seeking a determination that FireStar's patent, which was issued in 2000, is invalid."
• Red Hat could do this because while "Under U.S. Patent Law, an issued U.S. patent is presumed to be valid. However, patent validity can be challenged and, in this case, significant prior art from Borland and Oracle has been identified that may bolster Red Hat's invalidity defense," Zoltick added.
• Looking ahead, Zoltick thinks we're only going to see more of these patent lawsuits. "Given the increasing rate at which software patents are issuing and the ultra-competitive landscape in the software industry today, we are going to see a trend of more and more of these kinds of lawsuits," said Zoltick. "Open source providers are fair game as software patent infringement targets and I expect that companies looking to gain a competitive advantage by way of an injunction or a revenue stream from damages or licensing will leverage their patent portfolios to do so."
• This, in turn, will give the Free Software Foundation's push for an anti-patent clause in the upcoming GPL 3 open-source license a boost, according to Zoltick. "The Free Software Foundation attempts to justify the patent retaliation clause of GPL v3 by referring to an 'explosion' in the issuance and use of software patents and the FSF's overarching goal of making sure that users really get the 'four freedoms.' I would expect that the FSF and other supporters of GPL v3, as well as the anti-software patent promoters, will use this lawsuit as a vehicle to illustrate why the patent retaliation provision of GPL v3 is important and necessary," Zoltick said.

For more information, please contact Martin Zoltick at 202-783-6040 or mzoltick@rfem.com

Link to full article