"Anonymous" in a comment after my post below on patents praises my advice, and gives a personal example of how he redesigned his product to get beyond patent protection, to a better product anyway.
Very good, but this being USA, it is still possible for the patent holder to sue you anyway. Lawsuits for many reasons occur in USA, and often they are about just using the legal system to bully someone into submission. Lawsuits are expensive and time consuming. What if you could make anyone who sues you very sorry they did? I'll tell you how.
First, anytime you are threatened with a lawsuit, you first response should be to de-escalate. Say to the complainer "We have a business problem. If you sue me, you make it a legal problem. Why don't we first sit down, discuss the problem, you and I and see if we cannot work this out as a business problem. If not, you can always sue me later, and convert it to a legal problem." That either works, or not.
If not, then you get hit with a lawsuit. Your first reaction is likely to be to hire an attorney yourself to defend you. Don't do it. Represent your self in court, act as what the courts call "pro se," that is representing yourself. It sounds crazy and scary, but let me explain.
Most of a lawsuit takes place outside of the court. Roughly there is the complaint which you must answer, preliminary issues dealt with, often before a judge but with all sorts of other routine matters for other cases as well as yours in a court session. Then it is on to interrogatories and discovery, depositions and then trial. A long expensive process if you have an attorney. Very few cases in life go to trial.
Most of a lawsuit is preparing legal documents in proper form and in a timely manner. Whereas in USA you've always been able to represent yourself, until about 15 years ago, it was not a good idea, because you were likely to screw up the paperwork, and find yourself in trouble. The change that came, at least in Washington state and is probably true in most states, is before it was all or nothing, a lawyer completely represented you, or not at all. Now you can hire a lawyer for an hour and have them put your reply in proper form and tell you the proper time and place to file it. So although you are representing your self, the person suing you invests $5000 to start the case, and your response costs you $150. Most of a case is the paperwork, not court appearances. But if you are obliged to make a court appearance, simply do so. When your case is called up, you sit at a table like a lawyer. You are being sued so the other side speaks first. The rules pretty much are he cannot say anything that he has not already put in writing, so there should be no surprises. Make notes especially of anything he says that is new to you. Then object. As long as you are never disrespectful of the judge, there is nothing you can do or say that will get you in trouble. The courts have ruled that judges are obliged to generally be patient and forgiving of people acting pro se, and to use reasonable care to understand and accommodate the pro se. Even if you make a terrible mistake with an adverse ruling, you have ten days to appeal back to the same judge. Get the lawyer helping you to coach you on this point. But usually, these preliminaries do not much matter. Worst case, you have to fork over another couple of hundred dollars, but to appear in court, the people suing you had to pay a few grand to their attorney.
Although these preliminary hearings can be terrifying, if you can simply show up in court, take your place, make a few objections, you will have ruined the case for the person suing you. You just made clear you are not afraid to go into court and defend yourself. Their best weapon against you, fear, is now useless.
If you can do this, then you begin to make them sorry they sued you. After the preliminaries, come the interrogatories. Here you get 150 pages of questions you are obliged to answer within say 30 days. If you had an attorney representing you, these would cost thousands to answer. Don't worry. First thing you do is make a photocopy of the whole thing. Then write in very short answers, handwritten. If you do not know the answer, say so. If you think the question has nothing to do with the case, say so, and don't otherwise answer. Use the old rhetorical advice when answering relevant questions: seldom affirm, never deny, always differentiate. If a questions asks "do you still beat your wife" of course do not say yes, but don't say no...say "you call that a beating?" or "define 'beating'" Give them nothing.
These cost the person suing you thousands to prepare. And it just cost you nothing to respond. If you are obliged to respond within 30 days, on day 28, send it in. Drag out the calendar. Usually you send a copy of your answers to the clerk of the court as well as the attorneys suing you.
Now this is where it begins to get fun. Remember that photocopy of the interrogatories you made before you wrote in your answers? It is addressed to you on top of the front page, and below your name is the name of the person suing you and his law firm. There is plenty of empty space around this area on the sheet of paper. Where the interrogatories are addressed to you, cross out your name and write in the name of the person suing you. Where it says the name of the law firm who sent you the interrogatories, you write in your name and "pro se. Send back a copy plus one to the clerk of the court. The person suing you now has 30 days to answer all those 150 pages of questions. You might even come up with a few questions of your own, and add them on, just continuing the format on extra sheets you produce on your word processor. This cost you exactly nothing, but the law firm will be obliged to answer all of the question with full legal care, so it will cost the person suing you thousands. The case has gone almost no where, you've spent maybe $500 getting guidance from an attorney, and the person suing you has forked over at least $10,000.
The next step is depositions, an extremely expensive proposition. If you clearly are not intimidated, and are quite capable of guerilla action in your own defense, and this case has already cost so much for so little, the person suing you will wonder what will happen in the next phase? It is very likely the lawsuit gets dropped by this point.
If not, and you go on to depositions, then watch the videos of Bill Clinton being deposed in the Monica Lewinsky case. Learn from the master. Give them nothing. And then, next, it is your turn. You can take all the time in the world, videotaping questions, with the person suing you surrounded by lawyers, all charging top fees. Ask the same questions back, and throw in any you have. Nail them again in time and money.
If after this they still want to go to trial (is it possible you'd have any case worth so much money? is it such a large case, and so clear? Wouldn't any victory by pyrrhic anyway since such a large case would bankrupt you if they won?)
But let's say it goes to trial. Then defend yourself in court. Or not. At any point you can call in your own attorneys and let them take over. If you lose bad on some point at some point, you always have a week or so to get in an appeal. But by going pro se, you upset the usual process of getting beaten into a settlement. By going pro se, instead of a settlement, you are far more likely to see the case dropped. going pro se means your defense costs almost nothing, but suing you costs exponentially more. Instead of letting people use the legal system to bully you, use their force back against themselves. After a while, when you see the legal process is not such a big mysterious scary thing, you can even find it fun to defend yourself. Better to never get in a case to begin with, but this is USA, and you may have no choice.
Friday, September 30, 2011
Business, Lawsuits and You
Thursday, September 29, 2011
Free Markets By Ending Intellectual "Property"
Of the near 7 million patents issued in the US since 1789, almost nothing patented has ever turned into a product.
Of the extremely few patented ideas that have ever turned into an actual product, almost none has been profitable.
Any patent attorney can tell you this. Stephan Kinsella is one such patent attorney, who holds his own patents, and is quite frank about all of this.
Of the items that were profitable, it is most likely they would have been profitable anyway, patent or not.
How come intellectual property law is a non-performer (or worse?) Because products and services are constantly in development, and a patent is for a fixed idea. If a patent is a thesis, the idea will provoke antithesis (a good alternative) in the minds of others. Yet others will reflect on the thesis and the antithesis and synthesize yet another alternative. The lively antithesis and synthesis are far enough away from the thesis to not infringe on the patented item. Ossified, the thesis is overwhelmed by those who seek to serve others (antithesis and synthesis), the thesis goes no where. It is condign punishment that those who try to control markets with ersatz laws generally fail. Do not become one of them.
The value to the market is the division of labor producing better solutions for ever narrower groups. Those thus satisfied are uninterested in the patented idea. Such customers support the new businesses and wealth, defined as access to affordable options, is spread to more people.
The number one patent holder in USA, IBM, is open sourcing much of its patent book. They've learned their lesson after a bruising few decades.
What matters in business is not control or monopoly, such as you get with patents, but customer service, such as you get with marketing. It is not a patent that is valuable in business, but a customer list. Your customer list, which takes less time and money to build than it does to gain a patent.
We live in a patent regime, and it is not likely to go away. But by understanding that intellectual "property" is a net deficit helps one to build a business faster with less money spent. It saves time and money to know how things really work.
You recall the start of a business: what problem do you experience in a field you love? What problem actually causes you to suffer, at some level. And does working on the solution give you joy? That combination is the dead giveaway that you found your calling, the work that you are meant to do.
Wednesday, September 28, 2011
Exponential Taxing
Here are the taxes on a $52 car rental at SFO.
| Concession Recovery Fee 11.11 % | $5.86 |
| Airport Access Fee 20.00/rental | $20.00 |
| Tourism Fee 2.85 % | $1.49 |
| Vlf Recovery .22/day | $0.44 |
| Sales Tax (8.250%) | $4.80 |
| Subtotal | $32.59 |
| Estimated Total | $84.89 | |
| Estimated charges are confirmed based on the information you have provided; only taxes, fees, and surcharges are subject to change. | ||
So the taxes run about 60%. One of the reasons "public works" cost so much is because the people who run them can charge so much. You have no alternative when all Bay Area airports fix prices.
One reason things are so expensive is it is so easy to charge so much. The federal travel budget is some 14 billion a year, of a 700 billion industry (not including military, most of which is untaxed, so it has nothing to do with my point.) State and local government is on top of the 14 billion, lets say 85 billion for a total of 100 billion rounding up, because there are 2 times as many state workers (28 billion) and 4 times as many local govt workers (56 billion.)
Am I estimating too high, because local govt does not travel as much as fed govt, or go as far? Well, you don't know your government. Google "city travel budget cut" and you get 79 million hits.
There is talk to slash federal travel budgets, as well. So what? Well, if govt travel is 12% of the total, slashing that budget will reduce tax receipts for those expensive airports. Then bonds are not supported, so there is either default or tax increase, which reduces tax income, so it is a nasty downward spiral. Things get worse all over.
The money for this government travel comes out of producing people's pockets. So we pay taxes so travelling govt workers can pay taxes, on top of their travel expenses. It would be a good thing if the state travel budgets were cut, so we paid less in taxes. Then we'd have more money to pay the taxes on the bonds for airports for which we were charged too much for too much airport. Maybe that is the point of slashing the travel budgets. I doubt it, the money will just go elsewhere in govt expenditures.
Slashing budgets is good, as is cutting taxes, and deregulation is best. We deregulated telephones in 1980 and we had the computer/internet revolution. Deregulate, something, anything, so we can have something that actually grows and increases.
The Turkish economy is growing, because the Turks make things and sell them, without subsidies. There is nothing in USA that is not highly subsidized: food, housing, clothing, education, medicine, banking, transportation, poverty and obesity... so we have the terrible downward spiral of ever lower quality, ever higher prices, ever more government control. And add the burden of pointless war to this, and we are stuck in the muck. It is impossible to recover economically under these conditions.
We have a tremendous obligation in the form of bonds for the infrastructure we built to support activity not needed. Default is the best answer, plus freedom. Iceland did it and is already recovering. Yes, there would be great dislocation among the powers that be, when they lose the tax revenues. And they would rather rule over ruins than be a shoe clerk in paradise.
What to do? Succeed in place. Get self-employed. Get exempt from the madness.
Tuesday, September 27, 2011
Importing as a Small Business - Foothill & De Anza Colleges - Community Education
Importing as a Small Business - Foothill & De Anza Colleges - Community Education
October 8th I am teaching an all-day seminar at Foothill DeAnza College... we get a good crowd there, in Cupertino California.
Amazon Reviews Are Cliff Notes
I read about a book on advertising that I looked up on Amazon.com, and of course it was there. Then I read the 7 reviews, which outlined what is in the book, pro and con. In essence these reviews constitute a cliff notes of the book. Very useful info, and a great way to survey the literature on a topic, and what people think about the book.
Monday, September 26, 2011
Charles, Oliver, Richard, Charles, James, William and Anne
Samuel Pepys lived through all of those leaders, a rather tumultuous era. King Charles was beheaded in a revolution in which Oliver Cromwell took over power, Cromwell past it to his son, Richard, who really did not want it, so Charles' son Charles was restored as King of England, when Charles died his brother James took over, but he was so disliked his son-in-law, William took over, and when he died, his sister in law Anne became queen. And more, during these times plague wiped out London a few times, and the city burned down. Pepys managed to keep his head while so many others close to the crown lost theirs, literally. Pepys is famous for writing it all down. I just finished a book about Pepys by Claire Tomalin.
Today half believe of the USA citizens believe the US Govt is an immediate threat, a clear and present danger to themselves. If history is any guide, the per cent has to rise quite a bit before anything happens, good or bad. There simply is not enough dissatisfaction for any meaningful change to begin. All of these leaders, at one time or another, failed to pay their sailors, when the navy was the only game that mattered. Sure there were riots, but so what, plus, USA is not there.
Do not expect any changes. Only rely on the fact we are a long way away from any changes. Things will get slowly worse, the standard of living dwindle, but we can take ever so much more abuse. Wars were constant during this era, like it is now. Self -employment is your only hope, your property, paycheck and pension are in the sites of the powers that be. Self-employment is the only defense.