e-Literate

Present is Prologue

Tag: Blackboard-Inc.

  • Is Blackboard's Lawyer Calling D2L's Customers?

    Here’s an interesting bit from D2L’s patent blog:

    Clients have been calling us to let us know that Matthew Small, General Counsel of Blackboard, has been calling them. From what we understand, his purpose appears to be twofold: (1) to encourage clients to switch to Blackboard ; and (2) to create FUD (fear, uncertainty, doubt) with respect to alternative products and services in the eLearning space.

    From what we gather, he has been making statements that are not supported by the record in the Court or by the actions of the Patent & Trademark Office. If your organization is called, we invite you to suggest to Mr. Small that we are always willing to engage in an open dialogue with you and him.

    We remain confident that Learning Environment version 8.3 is an appropriate design-around to the patent claims – as we announced nearly one month ago. We also remain confident that the patent’s claims are invalid and that the Courts and the PTO will ultimately invalidate the patent.

    As there is no www.factcheck.org for this litigation, we continue to encourage you to review the documents and the facts. We are happy to discuss any questions that any client, or other interested people, may have. Just let us know!

    John Baker, President and CEO ([email protected])
    Diane Lank, General Counsel and Director, Legal Services ([email protected])
    John McLeod, Director of Marketing ([email protected])

    It’s unsurprising that an aggressive company engaged in a lawsuit with its competitor would use the suit to try to poach customers. But I’ve never heard of a company having their lawyer act as a sales guy. If it’s true, it certainly demonstrates a pretty high level of chutzpah.

    I’m very curious to find out more.  If you’ve received a call like this or know anybody who has, let me know. I’m particularly interested in who called and in what factual claims they made about the legal situation.

  • What the Sakai Announcement Means

    Barry Dahl read the Sakai Foundation’s recent announcement about the Blackboard patent pretty closely and is concerned that it sounds like they think the fight is over. I completely understand why he interpreted it that way, but I read it a little differently. If you look closely at the specifics of the legal situation, the Foundation’s position begins to make a lot more sense.

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  • Interview with an East Texas IP Lawyer on Blackboard v Desire2Learn

    A few of the usual suspects have pointed to this one already, but in case you haven’t seen it yet, Barry Dahl has a fantastic podcast interview up (about 30 minutes) with Michael C. Smith, an intellectual property lawyer in the district where the case was filed and author of EDTexweblog. Both interviewer and interviewee did a terrific job of really illuminating some of the legal nuances.

    There is one point that bears revisiting, though. Michael, in answering Barry’s questions about the USPTO re-examination, appeared to assume that the re-exam was ex parte. This is a perfectly reasonable assumption, since ex parte is far more common a challenge type than inter partes. Nevertheless, the D2L/SFLC challenge is actually inter partes (or, to be more specific a weird hybrid of ex parte and inter partes that mostly follows inter partes rules). Some of Michael’s answers would probably be unaffected by this difference, e.g., the likelihood that the USPTO ruling will affect the prior court ruling. But some, like the probability of a successful USPTO challenge, how this challenge fits into a larger litigation strategy, and how the judge might react to the challenge going forward, could. I’d be really interested to hear whether any of Michael’s answers change based on this information.

  • Blackboard Fails Statistics 101

    Blackboard has posted their response to the USPTO ruling. They make some claims about how this will impact the trial, which I’m not in a position to evaluate just yet. They mention that all of the claims in the re-examination request “were unsuccessfully raised by Desire2Learn during recent litigation,” which is irrelevant since these are different forums operating under different rules with different burdens of proof. But what really gave me pause was their statistic. They claimed that “more than 90% of patents that undergo reexamination of this kind ultimately are upheld.” That didn’t seem consistent with the statistics that I remembered. Where did that number come from?

    Funny story, that…

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  • All 44 Blackboard Patent Claims Invalidated by USPTO

    This just in:

    On March 25, the U.S. Patent & Trademark Office issued its Non-Final Action on the re-examination of the Blackboard Patent. We are studying the document, found here, but in short, the PTO has rejected all 44 of Blackboard’s claims. We caution that this is a NON-final action; both Blackboard and Desire2Learn will have an opportunity to comment before a final action will issue, and after that, the decision will be subject to appeals.

    This decision actually should have come before the trial verdict but was held up because the USPTO had to decide what to do about the separate filings from D2L and SFLC. Now, in addition to the fact that Blackboard will be able to argue against the ruling with the USPTO, there are a number of questions regarding how this affects the court case. Will the damages finding still stand? Will the USPTO ruling render moot D2L’s post-trial motion before the judge regarding invalidity? If not, will it imact that ruling? What happens to the issues of royalties and injunction going forward? I think that I know the answers to some of these questions but don’t want to post anything until I have some more authoritative information.

    Stay tuned.

  • Bad News for Blackboard, Good News for Moodle

    The American Association of Community College’s Instructional Technology Council (ITC) has just published its 2007 Distance Education Survey Results, covering data from 154 U.S. community colleges. And there’s a lot of interesting stuff in it. Here are the headlines that I drew from it:

    • Distance education continues to grow at a very healthy clip, particularly in this market segment.
    • Blackboard is losing market share rapidly
    • Moodle doubled it’s market share in the past 12 months and now has the highest market share after Blackboard/WebCT in this market segment.
    • ANGEL and D2L also grew their market share.
    • We have reason to expect more LMS churn in the near future, which is bad for Blackboard.
    • The top 5 areas of likely distance learning-related service growth in this segment are (1) online student organization web site and services, (2) online counseling and advising, (3) online plagiarism evaluation, (4) audio/video streaming, and (5) online textbook sales.

    As you can imagine, the LMS market share stuff is what interests me the most at the moment.

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  • Desire2Live

    There’s a very interesting interview of Desire2Learn CEO John Baker and General Counsel Diane Lank in T.H.E. Journal. It’s a particularly good read if you haven’t been keeping up on the details of the trial, but there’s also good stuff in it for people who have been following closely. For me personally, the biggest bit of news in the article was this from John Baker:

    $3.1 million is a lot of money, but it’s certainly not putting us in any financial jeopardy whatsoever. We’ve been very fortunate to have incredibly strong clients over the years, some of which pay almost that much money as an individual client. So we’ve been very, very fortunate to have good clients and good cash flow–no debt–we’ve got a very strong cash position. So we could pay that, without actually skipping a beat, and continue to be profitable this year and going forward. So from a financial perspective, it’s one of the concerns people have raised over [the course of the trial]. In the early days, $3.1 million was a lot of money for us. Today it doesn’t even come close to our R&D budget within our organization.

    So we’re quite comfortable; we’re still hiring a lot of people; we still intend on growing; we’ve obviously launched new products; and we’re actually going to be launching more later in the year. So we’re intent on keeping our innovative edge and [focusing on] the clients and client success.

    What’s interesting is we actually think that by all of our clients moving to 8.3, it’ll actually result in us having to support less versions of our application. Instead of being like Blackboard, where they’re probably supporting about 20 different versions of the application, at tremendous cost, we’re going to be supporting one, which will probably shave millions off of our costs [which will be applied to] new projects, new technology. We’re going to better support our existing clients. Or to focus our energy on the next version, the 8.4 version, or the 9.0. So we’re actually quite excited. We’re actually trying to find the silver lining in this and put ourselves in a better position than we were [in at the start of this]. Now, it’s not what we wanted to go through, but we can afford to pay it.

    And then, what might happen is that if we lose on appeal, there’s nothing else we have to pay. We’ve got that workaround put in place. So that one-time cost for us is something that we can absorb. Some of the things we’re going to be asking the judge to do is to reduce that as well, if he doesn’t eliminate it altogether.

    Because D2L is not a publicly traded company, we’ve had no visibility into their financial situation and how the suit was affecting them. If they can manage to get the injunction cleared up (particularly it is cleared up by the judge accepting their workaround), then they may come out the other side of this just fine.

    Also, they’re still cranking out product. Version 8.3 appears to be a fairly robust release with a lot more functionality than just the patent workaround, and they have a new and impressive sounding ePortfolio product. (I highly recommend Barry Dahl’s podcast interview with D2L’s lead product manager Kenneth Chapman.) Their management team must be really good, because I never would have predicted that a company their size would have the cash reserves to manage under this sort of financial burden and the focus to keep developing with this much distraction.