A federal judge last week wrote that he was “concerned” Oracle and Google had paid journalists and bloggers to comment on their highly-publicized intellectual property trial and ordered them to provide a list of names. The responses are now in.

Oracle’s list is headed by patent propagandist, Florian Mueller, a long-time Microsoft consultant whose FOSS Patents blog regularly posts articles slanted against Google (see “Oracle Java patent rises like Phoenix from the ashes”). Mueller, who has no legal training, works with his clients’ lawyers to issue authoritative-sounding pronouncements about patent cases, according to a longtime lawyer we talked with who consults with journalists and technology companies.

In an email to paidContent after publication of this story, Mueller rejected the notion that he works his clients’ lawyers: “I develop and author my blog posts on lawsuits involving Microsoft based on the court documents I download from official, neutral sources, or based on what I hear when I personally attend court hearings or announcements of decisions. I absolutely positively do not work[] with lawyers of [Microsoft or any other client] to issue authoritative-sounding pronouncements about patent cases.”

Oracle and Mueller have attempted to defend the latter’s behavior by noting that Mueller issued a brief disclosure at the outset of the trial. Mueller did not, however, flag the conflict of interest in subsequent posts and typically does not disclose his affiliations when speaking to other media outlets. Oracle does state “Oracle retained him after he had begun write about this case; and that he was not retained to write about the case.”

Google’s filing says it did not pay anyone to report or comment on the case nor engage in any quid pro quo with those who did.

In addition to providing brief disclosures related to the trial, both sides appear to have used the submissions for strategic advantage.

Google uses its filing to describe its extensive contribution to universities and researchers, and to call attention to its transparency policies. The appendix to its filing includes a list of trade associations, non-profits and researchers to whom Google has given money.

Oracle uses the bulk of its response to accuse Google of skullduggery: “a network of “direct and indirect  “influencers” to advance Google’s intellectual property agenda. This network is extensive .”

Neither side offers any insight into the relationship between money and media.

Oracle lost the case that was dubbed “the World Series of IP” and the two sides are now fighting over costs.

Both filings are below.

Google Shill List

Oracle Shills

(Image by Iwona Grodzka via Shutterstock)

The unusual request comes months after the “World Series” of intellectual property trials in which Oracle unsuccessfully sued Google for billions.

The trial was remarkable not only for the large damage figures but for Oracle’s decision to hire Florian Mueller, a self-described “patent analyst” who also takes money from Microsoft. In his FOSS Patents blog, Mueller wrote a series of one-sided posts over the course of the trial such as “Oracle Java patent rises like Ph0enix from the ashes.”

Despite a lack of legal training, Mueller holds himself out as a patent expert to the media and typically does not disclose that he is paid by the companies he reports on (he disclosed an Oracle relationship briefly at the outset of the trial but did not do so subsequently or to other media). Mueller has also blocked me and other journalists who have questioned his impartiality from viewing his Twitter feed.

Alsup does not provide detailed reasons for his order, which was first reported in a tweet by Reuters reporter Dan Levine, but does state that the information would be useful on appeal:

to make clear whether any treatise, article, commentary or analysis on the issues posed by this case are possibly influenced by financial relationships to the parties or counsel.

In the larger picture, Alsup may be calling attention to the growing phenomenon of astro-turfing — individuals or groups who receive money to pose as voices of the public interest. The Federal Trade Commission has in the past fined a company for failing to disclose paid endorsements. An FTC official told paidContent earlier this year that endorsers must disclose all material facts, including when they comment about a competitor.

Here is Judge Alsup’s order:

Blogger Order

(Image by Imagelabs via Shutterstock)

According to Patrick Doody, a former patent examiner and partner at the Pillsbury law firm, the cost of the proceedings is in the tens of millions of dollars and counting.

“As a general rule, even simple patent cases can cost a few million dollars,” said Doody. “This is probably ten times the size of the average patent case. $50 million in legal fees for both sides [is a reasonable guess].”

The figure is not surprising. A new ruling yesterday rejecting Oracle’s patent claims means that more than 1200 documents have now been filed in the case. The case has also involved more than two dozen attorneys from various white shoes firms, including David Boies, a celebrity lawyer who has represented everyone from Al Gore to the NFL. The sides have also paid for public relations initiatives such as Oracle’s controversial decision to hire an ethically-challenged blogger to spin its side of the trial.

A “Near Disaster” or business as usual?

After a jury last week concluded that Google had not infringed on Oracle’s patents, an intellectual property attorney at Stanford told Bloomberg that the case had been a “near disaster” for Oracle. The patent finding came after the jury was unable to decide if Google should be liable for copyright infringement. The judge also cancelled a planned damages phase of the trial.

On its face, the trial does appear to be disaster for Oracle which has now burnt through tens of millions in legal fees with nothing to show for it. But in the bigger picture of Oracle’s strategy, the legal bills may amount to just another cost of doing business.

According to Doody, Oracle is simply pursuing a common strategy in which companies that have passed their innovation phase turn instead to their intellectual property portfolios to make money. In Oracle’s case, the widespread use of Java in the Android smartphone market means the potential pay-off is worth the legal investment.

Doody says that companies in Oracle’s position can do one of two things to chase licensing revenue. They can either pressure small companies to obtain licenses so as to lay the groundwork for asserting patent claims against a big company. Or they can try to spear a giant company in court (in the way that Yahoo is targeting Facebook) which, if successful, makes it easy to pick off smaller players.

“One strategy is to go after small companies first. Or, go after the big guys first, and then [turn to small firms to] load them up and sign them up.”

Oracle clearly appears to be trying the whale strategy. At the moment, it is suing not only Google but SAP and Hewlett-Packard too.

Runaway lawsuits

There may be a perverse logic to Oracle’s lawsuit against Google, and not only from a licensing standpoint. As the case moves up to appeals levels, the company stands a chance of persuading the courts to expand the number of things that can be covered by patents or copyright. If that happens, Oracle would be poised to seek even more licensing revenue.

And appeals seem inevitable. Both companies have suggested that they are far from finished and Doody predicts that Oracle will try and drive the case all the way to the Supreme Court.

If this comes to pass, the estimated $50 million price tag will have only covered the first few games of a 7-game World Series. Renowned software developer Linus Torvalds decried the situation by saying Oracle would “pay lawyers to take it to the next level of idiocy.”

The outsized legal fees in the Oracle case, and in dozens of other smartphone patent cases, raise the question if these trials are the most efficient way to promote innovation. Consider that $50 million could pay the annual salary of 500 Silicon Valley engineers or pay for a new start-up jumpstarter like Y-Combinator or Betaworks.

So far, though, it appears that Oracle CEO Larry Ellison is satisfied with the company’s current strategy. He yesterday portrayed the Google case as a victory for his company.

(Image by Aptyp_koK via Shutterstock)

The phenomenon has been on display again during this week’s epic intellectual property trial between Google vs Oracle. Florian Mueller, a self-proclaimed patent expert funded by both Oracle and Microsoft, has been issuing a flurry of biased blog posts that don’t mention his paymasters. (His risible excuse for the shameless plumping is that he’s an “analyst”).

Microsoft is hardly the first company to astroturf but it does deserve special mention for being a master of the craft. As well as its patent puppet, the company has a roster of other hired mouths. These include law professor James Grimmelmann who it paid to collect criticism of the Google book settlement and ICOMP a group devoted to smearing its rivals in the European Parliament. A number of mom-and-pop businesses suing Google for antitrust, it turns out, are also tied to Microsoft.

[Update: Grimmelmann notes that Microsoft had no approval or veto power over how the funds were used and adds the project also received support from the American Library Association. The project continues as a public resource website.]

This type of professional distortion may strike some as unethical. There is also the question of whether it should be illegal.

The Astroturf Police

In 2009, the Federal Trade Commission announced new rules about bloggers and endorsements. The rules seemed mostly for show until a year later when the FTC fined a public relations firm $250,000 for seeding Apple’s iTunes store with fake reviews.

The rules make it illegal to endorse companies without disclosing that you are being paid to do so. It’s less clear, though, if they also apply to writers who receive money to tear down competitors.

According to an FTC spokesperson, the rules require a paid endorser to disclose “all material facts.”

“An endorser’s affiliation would be considered material to readers as they evaluate what the endorser says about the competitors of the company that compensates the endorser,” she added.

This suggests that the FTC may have the power to rein in negative astro-turfing. But is this a good idea? Civil libertarians have long argued that the best solution to bad speech is not penalties but instead more speech.

Sleazy or Smart Business?

While the legal or ethical case for astro-turfing may be shaky, the business case is stronger.

For a company like Microsoft that is in tight competition for billions of dollars, spending a few million on astroturf may be a smart strategy. The potential pay-off is huge — especially if astroturf efforts get a rival dragged before court or regulatory investigations.

Some would add that astroturf is simply a part of playing in the corporate big-leagues. Political parties do it so why shouldn’t companies? In this light, companies that don’t astoturf are simply the tech equivalent of Washington goo-goos.

Likewise, nearly every big company donates money to non-profit groups, many of which have aggressive agendas. Astro-turfing could be considered just a further extension of this practice.

The problem here is that astro-turfing may help companies but it also harms the public’s ability to understand complicated issues in technology. Many people distrust the tech sector to begin with — soaking the news with misinformation can only deepen their suspicion.

For now, the only hope to tear up the astroturf is for companies to stop paying for it or for those who do it to get a conscience. It  may be a long wait either way.

In the past few years, martinwolf  handled  Rolta India Ltd’s acquisition of TUSC, a large U.S.-based Oracle implementation partner and Hinduja TMT’s buyout of Affina, a U.S.-based business process optimization company. But Marty Wolf, CEO of the company, said the amount of interest in such deals is picking up, making the local presence necessary.  Gaurav Sharma, a former executive with IBM Global Services, will head the new office as SVP of the India practice.

One motivating force is that a number of mid-sized Indian tech companies — the layer below the giants like Wipro, Tata, Infosys etc. — need to grow to survive, Wolf said. And, it’s time for the world to acknowledge that these companies are more than low-cost leaders.  ”Their advantage goes way beyond cost,” he said. “In many cases they offer better solutions faster and cheaper than [U.S. competitors]. The beneficiaries are the end users.”

These mid-sized companies have great expertise but often lack the channel and partners to implement it in the field far from home, and are looking for partners in the U.S. and elsewhere to do that for them. So, Wolf hopes to act as a matchmaker between companies in India and the U.S. but is also working on deals with companies in Israel and elsewhere.

Going forward more these deals have a distinct cloud flavor, Wolf said.

Feature photo courtesy of Flickr user Melanie-m

That is according to an interview that she has given to the French newspaper Le Figaro (via TNW), in which she also notes that there are about 600 people left working in webOS, which further complicates its fate.

WebOS has been hanging in the air for months now, after HP abruptly announced this summer that it would discontinue making smartphones and other devices using the OS — just weeks after it had launched its first tablet, the TouchPad.

Since then, there have been rumors of potential buyers (including Amazon and Oracle); and even the thought that HP might hang on to the OS itself. After all, it already made one spectacular u-turn when it decided to hold on to its PC business, after former CEO Leo Apotheker had said the plan was to get rid of it.

Last month, it looked like HP was finally ready to spill the beans on what would happen with the platform business — with Whitman calling an all-hands meeting with staff in the division — but ultimately there was no news. Either that, or whatever news she hoped to deliver still hadn’t been finalized, because nothing came of that meeting.

The webOS platform held a lot of promise when it was first unveiled by Palm (which HP bought only last April for $1.2 billion). Its many supporters believed it provided an effective and engaging counterbalance to the trailblazing power that Apple (NSDQ: AAPL) and Google (NSDQ: GOOG) wield in the world of smarpthones and tablets. But today, with an almost negligible market share, it will take a lot of enterprise, attention, and investment if anyone hopes to get webOS up to speed again.

The report, in Reuters, cites four unnamed people as the source of the news.

It also notes that the sale is likely be in the region of hundreds of millions of dollars. That would represent a discount to the $1.2 billion that HP paid when it bought WebOS as part of its acquisition of Palm, Inc. in 2010.

There’s not much more detail in the Reuters (NYSE: TRI) story, except that it does name one potential buyer for the division: Oracle, which would mainly be interested in the WebOS patents that would be part of the sale.

Coincidentally, Mark Hurd, the former CEO of HP, is now president of Oracle, and if the story is true he may have had something to do with the deal.

This is not the first time that we have heard reports of a WebOS sale: the platform appeared a loose end after HP announced in August it would discontinue making the mobile devices that ran on WebOS. However, HP has made a point of publicly stating that it was remaining committed to the platform, or at the very least continuing to evaluate how best to develop it next, after deciding to discontinue its mobile device operations that included the TouchPad tablet (pictured).

But anything is possible at today’s HP: in October, under new CEO Meg Whitman, the company said that it would hold on to its PC division — an asset that former CEO Leo Apotheker had planned to sell as part of the company’s reorganization.

The list of would-be buyers for WebOS has run long and included mobile companies like HTC and Samsung, but also Amazon and Facebook — all companies that could get something useful out of the OS.

Adding Oracle and a patent interest gives the WebOS story yet another facet to contemplate.

» Apple (NSDQ: AAPL) stock reached an all-time high yesterday, closing at $411.63 and valuing the company at $381.62 billion, as reports of new products — believed to be new models of the iPhone — continue to swirl. (CNET)

» Samsung is apparently planning to make Bada open-source in 2012. Will it have any more success with that concept than Nokia (NYSE: NOK) did with Symbian? (WSJ)

» Verizon has announced to its customers that the heaviest data users in the most congested sites will start to see reduced data speeds, AKA “throttling”. Verizon says that this will be applied to the top five percent of users — typically those on 3G, unlimited data plans. (Verizon)

» Google (NSDQ: GOOG) and Oracle’s CEOs are meeting this week in an attempt to reach a resolution in their ongoing patent dispute over Android technology. Those talks will need to bridge a pretty huge chasm: Google thinks it should be paying $100 million in royalties; Oracle’s thinking more along the lines of $6 billion. (Bloomberg)

» Vodafonehttp://www.vodafone.com didn’t make it on its own in Japan (it sold its mobile operation there to Softbank), so now it’s looking to partner with a local player to target that market again: it’s tying up with NTT Docomo to target enterprise users. (Docomo)

» Nokia will not be releasing its one and only MeeGo phone, the N9, in Hong Kong, but it is still being sold in mainland China. (Engadget)

» Security nightmare for Skype: the latest version of the Skype app for iPhone has a vulnerability that could allow a malicious person hack into an iPhone to steal address book content. (Superevr)

Oracle and Google are locked in one of the few mobile patent lawsuits that directly targets the creator of Android, and Google has not had much luck prevailing on this particular issue, which involves an e-mail from Android engineer Tim Lindholm to Andy Rubin, the head of the Android project. Lindholm tells Rubin that “we conclude that we need to negotiate a license for Java under the terms we need,” and Google has argued that the potentially damaging e-mail should not be aired at trial because it was inadvertently disclosed and should have received attorney-client privileges.

Judge William Alsup, who is presiding over the case, didn’t buy that argument, and another judge tasked with arbitrating disputes over discovery items has now agreed. Judge Donna Ryu denied Google’s motion Thursday, saying she would explain her reasoning in a later court filing but ordering Google to turn over the e-mail to Oracle.

As we argued earlier, this whole saga may not be that big a deal: Lindholm’s e-mail was written after Oracle had already threatened Google over its use of Java, and providing advice that one’s organization should license a technology after being served with legal threats is not that controversial a notion. But it’s still something that Oracle will love to have at its disposal, and could make life a little more difficult for Google engineers and lawyers.

The e-mail, from Google engineer Tim Lindholm to the head of Google’s Android division, Andy Rubin, recommends that Google negotiate for a license to Java rather than pick an alternative system.

The key portion of the email was read aloud from the bench by U.S. District Judge William Alsup during a July 21 hearing. The second paragraph of the email reads: “What we’ve actually been asked to do by Larry [Page] and Sergey [Brin] is to investigate what technical alternatives exist to Java for Android and Chrome. We’ve been over a bunch of these and think they all suck. We conclude that we need to negotiate a license for Java under the terms we need.”

Alsup clearly saw that email as something of a smoking gun-a Google engineer saying that the company should negotiate a license, or in other words, strike a deal with Oracle rather than fight it out in court. After reading it, Alsup said to Google lawyer Robert Van Nest: “You’re going to be on the losing end of this document-with Andy Rubin on the stand.”

Now Google is taking action to have that email, and Alsup’s reference to it in his order, thrown out of the public record. In a letter dated July 28, Van Nest wrote to Alsup, explaining that Google had handed over the email (which was actually a draft) inadvertently, and then later realized the email was subject to attorney-client privilege and never should have been disclosed. Oracle’s disclosure of the document was “improper,” argued Van Nest, and the email never should have been made public.

That didn’t sway Alsup. He responded with an order on Aug. 1, disagreeing that the document should be kept secret. “Simply labeling a document as attorney work product or sending it to a lawyer… does not automatically trigger privilege,” wrote Alsup.

Google is taking one more shot at keeping the email under wraps. In a letter sent today, Van Nest asks for permission to show the judge additional evidence in a private hearing that would show how the email really is privileged.

Does it really matter? After all, multiple reporters were at the July 21 hearing (including myself) and reported on the contents of the email once Alsup read them from the bench. But battles over evidence still matter-if the document is found to be privileged then Google won’t have to show it to a jury (assuming the case makes it that far.)

Is the e-mail really the smoking gun Alsup implied it is? Not necessarily. As Van Nest explains in his Aug. 3 letter, Lindholm’s email was the result of an analysis he had done in response to Oracle’s legal threats against Google. After being told by Oracle that its use of Java is infringing patents, it’s only logical that a company would at least consider ditching Java altogether, to avoid litigation. Lindholm concluded that wasn’t a route that was going to work. Properly understood, Lindholm’s email is hardly an admission of infringement-it’s more like a suggestion that negotiation might be the best route.

But that negotiation, obviously, didn’t work out-Oracle’s outsize damage demands probably suggest its negotiating stance was pretty ‘out there’-and now the two companies are in court.

Overall, Google is feeling the patent heat on a number of fronts. Earlier today, the company’s chief legal officer published a blog post denouncing the “hostile, organized campaign against Android,” in which competitors like Apple (NSDQ: AAPL) and Microsoft (NSDQ: MSFT) are using patents to go after handset-makers who use Android. Oracle is the only major company to attack Android directly in court, however.