I got the following email from someone a few minutes ago.

Barry Eisler is one of my favorite mental floss writers.  Barry writes thrillers about a bad-ass named John Rain.  Rain is half-Japanese, half American assassin who specializes in making his kills look like natural causes.  Oh – and he’s good with the women.

His books, in order, are Rain Fall, Hard Rain, Rain Storm, Killing Rain, and (in June) The Last Assassin,  Now, Barry has a blog called The Heart of The Matter.  I no longer will have to wait a year to read the next batch of his prose.

I spoke on a panel last week at the Silicon Flatirons Telecommunications Program titled “Re-examining The Patent System.”  My panel was the last one and came after a few hours of stimulating discussion about the problems with patents, the problems with patent reform, and the reason our government is struggling so much with what to do.

When I was at MIT in the 1980’s, copyright and patents were just starting to be a major issue in the personal computer software business.  I vividly remember attending a lecture in one of my classes by the general counsel of Lotus who was suing Borland for copyright infringement between Quattro Pro and Lotus 1–2–3.  This was around the same time that Apple vs. Microsoft / Xerox vs. Apple lawsuits appeared, as well as the nonsense Ashton-Tate vs. Fox Software lawsuit.  Forget about patents – this was about copyright! 

Some of the research I did when I was a doctoral student at MIT was around the sources of innovation in the software industry.  In the late 1980’s, the three primary mechanisms for protecting innovation were copyright, patents, and trade secrets.  Copyrights (as evidenced by the legal action above) was the most active area and I – among many others – thought that copyrights were a problematic way to fundamentally protect software innovation, especially around look and feel (which was all the rage at the time.)  Of course, with the widespread emergence of the GPL and open source, the dynamics of software copyright have changed radically in the past decade, which is likely part of the reason the focus has shifted to patents.

I personally think software patents are an abomination.  My simple suggestion on the panel was to simply abolish them entirely.  There was a lot of discussion around patent reform and whether we should consider having different patent rules for different industries.  We all agreed this was impossible – it was already hard enough to manage a single standard in the US – even if we could get all the various lobbyists to shut up for a while and let the government figure out a set of rules.  However, everyone agreed that the fundamental notion of a patent – that the invention needed to be novel and non-obvious – was at the root of the problem in software. 

I’ve skimmed hundreds of software patents in the last decade (and have read a number of them in detail.)  I’ve been involved in four patent lawsuits and a number of “threats” by other parties.  I’ve had many patents granted to companies I’ve been an investor in.  I’ve been involved in patent discussions in every M&A transaction I’ve ever been involved in.  I’ve spent more time than I care to on conference calls with lawyers talking about patent issues.  I’ve always wanted to take a shower after I finished thinking about, discussing, or deciding how to deal with something with regard to a software patent.

I’ll pause for a second, take a deep breath, and remind you that I’m only talking about software patents.  I don’t feel qualified to talk about non-software patents.  However, we you consider the thought that a patent has to be both novel AND non-obvious (e.g. “the claimed subject matter cannot be obvious to someone else skilled in the technical field of invention”), 99% of all software patents should be denied immediately.  I’ve been in several situations where either I or my business partner at the time (Dave Jilk) had created prior art a decade earlier that – if the patent that I was defending against ever went anywhere – would have been used to invalidate the patent. 

When I made the assertion that we should simply abolish software patents entirely, I noticed a lot of lawyers heads moving vertically up and down.  I took this as a good sign, especially since a number of them had gray hair (and a few were on the earlier panels and sounded very intelligent and experienced, especially for lawyers.)

After wrestling with software patents for the past 15 years, I’ve concluded that there simply is no middle ground.  If we continue on the path we are on, patents will continue to increase in their overall expense to the system, everyone will feel compelled to continue to apply for as many (and as broad) patents as possible, if only for defensive reasons (one of Fred’s VC Cliche’s of the Week was “Patents are like nuclear bombs, you just got to have some.”)  Let’s take a page from geopolitical warfare and focus on global disarmament, rather than mutually assured destruction.

Jason sent me a quote that was on the first slide of a 409A presentation from one of the major law firms we work with.

“409A is the tax law that ate the world.  Every day we discover another 12 issues.”
—– Senior US Treasury Department Tax Official, March 13, 2006

Maybe Jack Bauer will start paying attention to 409A in tonight’s episode of 24.

As my Microsoft Web Only diet continues, I found myself using Live.com Image Search today to put together a presentation.  I hate text heavy Powerpoint presentations so I try to go to the Seth Godin school of Powerpoint and limit myself to six words per slide (e.g. lots of pictures.)  Historically, Google Image Search has been my friend when I put a presentation together.

I loved Live.com Image Search – it’s substantially better than Google’s.  The actual image search is about the same, but the UI is dramatically better.  It’s very Ajaxy – resize bar, mouse over to enlarge image and get image detail, drag and drop image to other apps, infinite scroll (rather than next, next, next), and overall nice / fast presentation.  Someone on the Google Image Search team needs to take a look.

The rumors about someone buying JBoss have been bouncing around for weeks.  As I was working on a presentation titled Commercializing Open Source for Eric von Hippel’s Democratizing Innovation conference this week, I went to Red Hat’s page to pick up their logo and saw that they announced the acquisition of JBoss this morning.

This is a huge success for everyone involved, especially Marc Fleury (JBoss CEO and founder) and the primary investors – Accel, Intel, and Matrix.  JBoss only did one disclosed round of financing for $10 million about two years ago.  Red Hat acquired them for $350 million with an additional $70 million earn out.  This is about 10% of Red Hat’s market cap.

Oracle should have stretched a little harder for this one.

Josh Kopelman has a thoughtful post on why he prefers preferred equity instead of convertible debt in seed-stage investments.  I agree with everything he says – definitely worth reading if you are involved in an early stage financing.

After all the depressing shit that I read in the New York Times today, I felt compelled to buy a new clock.

These were on sale in the Boulder Bookstore and I couldn’t resist.  However, I’m not so sure about the “… will soon be over” thing.

I’m running the Boston Marathon on Monday, April 17th.  I’m much too slow a runner to qualify, so my friend Nick Grouf and his fiance Shana Eddy gave me a charity number for my 40th birthday.  I’m running for The Michael Carter Lisnow Respite Center, a remarkable home away from home for children and adults with disabilities that offers parents time off from the emotional and physical care needed by their children.

Amy and I are heading to Boston on Tuesday.  I like to spend a week or so in the city where I’m running a marathon to get acclimated.  We lived in Boston for 12 years, so we’ll see some friends, I’ll spend some time at MIT with Eric von Hippel on some open source / democratizing innovation stuff, meet with some colleagues, and have a few nice meals.  As my friend Ilana, who is also running the marathon (for the American Liver Foundation) says – I’ll work to get my “marathon head” in the right place.  Today was my last real run – before I headed out all I could think about was “my knee hurts, I feel fat, should I listen to music during the marathon, will the weather be good, …”  By the end of my run I felt great and knew I was ready.

If you are in Boston watching the marathon, look for me – I’ll be the slow guy near the back of the pack wearing number 20778 (my goal is to finish while not coming in last.)  If you are interested in supporting me, please cheer me on and/or make an online donation to The Michael Carter Lisnow Respite Center.

Sometimes it’s best not to read the newspaper first thing in the morning.  Randall Stross has an excellent and disturbing article in today’s New York Times titled “Looking at the Free Market, and Seeing Red.” It leads with the story of Lou Dobbs bashing Lenovo and their recent deal to sell $13 million of computers to the US State Department.  Dobbs asserts that the PCs will provide spies within the Chinese government a way of conducting espionage.  His sound bite on the lead in was something like “when the State Department seeks secure network communications it turns to Communist China and thus renders the United States perhaps more vulnerable than ever.”

Give me a fucking break.  Last month this kind of xenophobic nonsense killed Check Point’s acquisition of Sourcefire.  This time around, Dobbs and some guy named Michael Wessel who is a member of the US-China Economic and Security Review Commission (an advisory body to Congress) and Larry Wortzel (the chairman on this same commission) are kicking up a bunch of dust about how dangerous it would be for the government to buy Lenovo computers.

Now – I’m not going to go so far as to say something absurd like “Lenovo is a national treasure” (I’m sure if it was still IBM’s Personal Computer Division, which is a big part of Lenovo, someone would use that argument), but given that Lenovo is a public company traded on the Hong Kong stock exchange, has an American CEO (a former executive at Dell), is partially owned by several American private-equity firms, and the computers in question are manufactured in North Carolina, my mind just boggles at the things these guys are saying.

Fundamentally, guys like Dobbs, Wessel, and Wortzel are using “security issues” and “xenophobia” to tarnish the reputation of a global company in an attempt to undermine a deal with the US government.  Maybe these guys should get focused on making sure these same Chinese that they assert are pulling all the strings would stop buying up the massive amounts of US debt that our government continues to issue – that seems like a little more “dangerous” issue to me (actually, the debt, not so much the owners of the debt.)

Maybe Penn and Teller should do an episode on Bullshit! on Dobbs and the current “security issues” running around our government that are really anti-competitiveness attacks reminiscent of the moochers in Atlas Shrugged.  Blech.