Once again, Cloudflare has proven that its unusual defense against meritless patent infringement claims effectively works to end so-called “patent trolling.”
In a blog post, Cloudflare announced that its most recent victory—defeating a lawsuit filed by Sable IP and Sable Networks in 2021—was largely thanks to participants of Project Jengo. Launched in 2017, Cloudflare’s program offers tens of thousands of dollars in awards to activate an army of bounty seekers and crowdsource submissions of evidence—known as “prior art”—that can be used to overcome frivolous patent claims or even invalidate patents that never should have been issued.
To find prior art, Project Jengo participants comb through academic papers, technical websites, and patent documents, helping Cloudflare explain in detailed petitions to the US Patent and Trademark Office (USPTO) why certain patents should be invalidated.
Sable’s lawsuit alleged that Cloudflare had infringed patents filed “around the turn of the century” addressing “hardware-based router technology of the day,” Cloudflare said. At that point, it was up to Cloudflare to convince a jury of perhaps not the most technically proficient peers that this router technology had nothing to do with Cloudflare’s “modern-day software-defined services delivered on the cloud.”
“Patent trolls create what we consider to be an unfair, unjust, and inefficient system that throttles innovation and threatens emerging companies,” Cloudflare CEO Matthew Prince told Ars. Whereas other companies often settle with “patent trolls” to avoid costly legal battles that can drain critical resources otherwise funding innovations, Prince said that Cloudflare’s most recent victory is “an important validation that we can successfully fight back against the threat to innovation posed by patent trolls.”
To defeat Sable, Cloudflare offered $100,000 “to be split among winners that submitted strong prior art.” Responding, Project Jengo participants spent three years tracking down dozens of submissions of prior art. Through those efforts, Sable’s lawsuit—which initially “asserted around 100 claims spanning four patents against multiple Cloudflare products and features,” Cloudflare said—was impressively narrowed to “a single asserted claim on a single patent.”
Even defending itself against one claim left Cloudflare in a difficult position, though. The company still needed to convince the jury that this one claim was meritless, or else the jury could award Sable potentially large damages simply because they failed to understand the complex technologies involved.
“Taking a case to trial—even on simple matters—is extremely costly,” Cloudflare’s blog said. “In patent cases, that means millions of dollars.”
This risk is precisely the reason why “patent trolls” file claims, typically acquiring “rights to the patents of a failed hardware company” and seeking to “monetize” patents “to the greatest extent possible,” Cloudflare explained. Seemingly utilizing this strategy, Sable had successfully secured settlements from several companies before, including Cisco, Fortinet, Check Point, SonicWall, and Juniper Networks. In 2021, Sable targeted Cloudflare, likely hoping for another settlement outside of court.
“If that meant leveraging a patent related to decades-old router hardware to sue a cloud-based service provider, so be it,” Cloudflare’s blog said. “And if it required leaps of logic and untethered claims that might make a toddler blush, oh well.”
Sable’s lawyers did not respond to Ars’ request to comment.
In court, pointing to prior art and sharing a Cloudflare engineer’s expertise, the Cloudflare legal team broke down for the jury “the many reasons why” Sable’s patent “does not describe anything that Cloudflare actually does.”
It took a jury two hours to decide that Cloudflare was right, not just dismissing Sable’s claims but invalidating Sable’s patent permanently because prior art showed that “Sable’s patent covered, at best, only technology that had already been described by inventors at Nortel Networks and Lucent Technologies—leading routing technology companies at the time.”
So far, Cloudflare has awarded $70,000 to Project Jengo participants who helped the company defeat Sable. According to Cloudflare’s blog, the company will announce the final $30,000 in awards after the “official conclusion of the case.”
Cloudflare also plans to share “additional thoughts and insights we’ve gleaned from facing down a troll at trial” to help other companies that are considering taking on “patent trolls.”
Project Jengo’s first success came in 2019 when Cloudflare defeated Blackbird Technologies. As a result of that victory, Blackbird “went out of business,” effectively ending that company’s meritless patent infringement claims, Cloudflare said. Now, Cloudflare has “invalidated significant parts of three Sable patents, hamstringing their ability to bring lawsuits against other companies,” Cloudflare said.
Because of the project’s success, Prince told Ars that Cloudflare would continue awarding “thousands of dollars in bounties” to discourage patent trolling through Project Jengo. With two wins under the program’s belt, Cloudflare hopes the Sable verdict serves as “a strong warning to all patent trolls—we will not be intimidated into playing your game.”