Patent Litigation Weekly: Jailed Inventor Reveals Details of Patent Troll Settlements
By Alison Frankel
October 23, 2009
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As Joe Mullin writes in his latest Patent Litigation Weekly column, one of the frustrations of reporting on infringement cases is the veil of secrecy that hides not only confidential settlements but also the tangled relationships between inventors, patent holding companies, and plaintiffs law firms. But thanks to an extraordinary filing by a onetime patent owner who's now serving time for insurance fraud, Mullin has all the details on one such deal--and what's more interesting than the $2.17 million in settlements that folks on the plaintiffs' side collected from Apple and three other defendants, is how those folks split the proceeds.The filing, sent from a federal prison in Wisconsin, is a typewritten motion to intervene in SP Technologies's infringement case against GPS makers Garmin and TomTom, which involves patents that were previously the subject of SPT litigation against Apple, Samsung, Magellan, and LG Electronics. The inventor of the patents--and the author of the motion to intervene--is an ear, nose, and throat doctor named Peter Boesen, who was sent to prison after being convicted of health care fraud in 2006.
Before his conviction, Boesen teamed up with SPT, a patent enforcement company, to capitalize on his 21 patents. SPT, in turn, brought in the notorious plaintiffs firm Niro Scavone Haller & Niro to file infringement suits for Boesen.
Mullin reports, based on Boesen's jailhouse filing, that STP eventually agreed to settle Boesen patent cases with Apple for $865,000; with LG for about $835,000; with Samsung for $417,500; and with Magellan for $50,000. (Oddly, $86,500 of Apple's payment was earmarked for LG; neither company returned Mullin's call for comment.)
What happened to the rest of Apple's settlement? A little more than 30 percent went to Niro Scavone, which also billed $46,500 in expenses. Another $40,000 apparently went to Texas plaintiffs lawyer John Ward, Jr. SPT got $109,000. About $310,000 was supposed to go to Boesen, who claims in his motion to intervene that he's owed a total of $748,500 from SPT's settlements of cases involving his patents.
He asserts, however, that he hasn't personally received any of the settlement money. He also claims that he sold his patent rights under "severe duress" to SPT following his fraud conviction, and implies that he was coerced by SPT and Niro Scavone.
Both the firm and SPT's former principal heartily reject Boesen's accusations. His money from the patent settlements, they maintain, is going toward the almost $1 million restitution he was ordered to pay in his fraud case. Moreover, they say, Boesen's apparent refusal to cooperate in the prosecution of pending infringement cases involving his patents is a breach of the contract that they assert he willingly signed with them.
Not surprisingly, SPT and Niro Scavone oppose Boesen's motion to intervene in the case against Garmin and TomTom.
