CH66 - Worst Outcome

During Barbara's silent moments, Ethan pondered the issues behind the patent. As he tried to use the guise of "protecting research" to become a beneficiary of the MOS 6502, he realized that true scientists must have enjoyed better legal protection before him, or artificial protection.

"So—"

Ethan took a deep breath and smiled, "Infringement, right?"

Since the situation was now settled, Ethan no longer felt angry. Not out of magnanimity, but because he knew anger was futile. The priority was to solve the problem.

Of course, before that, he had a lingering doubt, "Barbara, can you help me with one more thing?"

"Sure," Barbara opened her eyes and replied promptly, "If I have the means, I'll definitely help you inquire."

"This is indeed a gap in my knowledge, and I will try to correct my mistake as much as possible."

"Oh, Barbara, there's no need to mention these meaningless things again," Ethan shook his head with a smile. "All along, we've been causing you trouble, and you've been a great help to us. We should thank you."

Before the words settled, Evelyn approached, opened her arms, and gave Barbara a hug like a koala.

Embracing the girl's waist, stroking her back, Barbara sighed, "Thank you."

Then, she raised her eyebrows at Ethan, and upon receiving the signal to inquire, Ethan spoke his mind.

"Barbara, if Magnavox's patent is so powerful, why did they delay so much on the infringement issue with 'Pong'? 'Pong' is also a game that generates, displays, manipulates, and uses symbols or geometric graphics on a television screen."

"If Magnavox could sue us with this patent, why didn't they use it directly against Atari in the beginning?"

Exactly!

This was Ethan's most perplexing point!

If Ralph H. Baer's patent was truly powerful, why did Atari survive until now?

Shouldn't they have crushed them earlier?

As soon as this question arose, Barbara pointed to the patent copy on the table with a smile, signalling Ethan to take a look.

After Ethan picked it up, Barbara said, "Turn to the page about the patent holder and tell me what you see."

Ethan glanced at it and furrowed his brow, "Official patent effective date, April 17, 1973?"

"Inventor of the patent, Ralph Henry Baer, Patent owner, Sanders Associates?"

"Yeah~"

Barbara's words made Ethan chuckle and shake his head.

"This question you raised is also my curiosity. I thought there might be loopholes here, so I already asked the people at the patent office. They said this patent doesn't belong to Magnavox; it belongs to a company called Sanders."

"Because when Ralph H. Baer invented the 'Brown Box,' the predecessor of Magnavox's Odyssey, he was the technical director at Sanders. The entire development process also used Sanders' funding. So when registering the patent, the owner column was filled with the name of Sanders Corporation according to the development regulations."

"Magnavox initially only obtained the production, sales, and marketing rights of the 'Brown Box.' Then, based on these rights, they made a series of patent applications, such as the name, appearance, internal technology, and circuit board of the Odyssey. Their patents are specific to certain products."

"So, when Atari started copying in '73, Magnavox couldn't directly sue based on their product patents because, from a product protection perspective, the arcade game 'Pong' indeed didn't infringe on the rights of 'Magnavox Odyssey' as a home console. Magnavox initially didn't plan to obtain these patent authorizations from Sanders. It was only after the arcade industry became more prosperous, and they needed to aggressively defend their rights, that they communicated with Sanders, got all the patents, and afterward, they only needed to pay Sanders licensing fees."

"..."

Alright.

Ethan found this reason very convincing.

When so many coincidences came together, it was truly bizarre and beyond belief!

"Okay, okay, I understand."

Ethan nodded, "If that's the case, then we'll concede."

"With so many unexpected events happening simultaneously, this is really... damn!"

After swearing, Ethan also wondered what he should do next.

If possible, he didn't want to go to court.

If they could settle outside the court, they would because litigation is troublesome.

When Ethan inquired about his thoughts, Barbara indicated that things might not be resolved so quickly.

Because the United States has a complete litigation process. After the defendant receives the summons, they have a certain time to submit a response. In California, this time is thirty days. Then, it enters the next stage called evidence disclosure. In this stage, the lawyers for both sides exchange the evidence they have collected. After all the evidence is presented, most cases are essentially clear.

To save judicial resources, the court actually encourages settlements. So after the evidence disclosure stage, the parties can decide whether to enter the settlement or litigation stage. If the defendant meets all the plaintiff's demands, the court will not go to trial. Only if the settlement fails and the court mediation fails will it enter the final trial stage.

Of course, if it's Magnavox's own lawyer, their core goal is undoubtedly financial gain.

The more compensation the company can get, the more stable their position within the company, and the more business commission they can receive.

After all, the biggest role of patents that can control an industry is to make money.

But other law firms—

"They are also seeking financial gain, but what they seek is not compensation, but the litigation fees promised by Magnavox."

Barbara said, "In the complaint, Magnavox is asking for a million in compensation and to stop infringement."

"The former is basically all the profit you've made from 'Snake Game,' right? The latter is to make you stop selling 'Snake Game' within the United States or, in other words, stop using standard television as a medium for sales."

"The first one is easy to achieve, and the second one, I don't need to ask to know that you won't agree."

"So, I want to say, Ethan, please think about whether you offended Magnavox. Because under normal circumstances, when a patent infringement occurs, the first thing a commercial company should do is send a lawyer's letter to the infringer. Only after the infringer does not stop the infringement will they file a lawsuit. In the lawsuit, it is generally the company's lawyer who handles the issue, and external law firms are rarely involved..."

"Oh, by the way, there's one more thing. Atari is actually an infringing party, but why isn't their name on the complaint? You need to carefully understand this issue because if there are two cases, that would be the worst outcome..."

"Because what you might have to compensate is not just a million, but more."

Barbara's words made Ethan frown.

He really didn't understand where he offended Magnavox!

Was it because he demanded 2N+1 when he was dismissed initially?

Or was it because he sent an invitation to Nolan Bushnell for Odyssey?

If Magnavox was making a big deal out of these things, Ethan would really be speechless!

Because the first was him fighting for his legitimate rights, and the second had nothing to do with him!

After thinking for a while, Ethan couldn't figure out a reason.

Seeing that it was getting late, Barbara suggested that they go home and think slowly.

After all, the response could be submitted within thirty days, meaning, as long as they could figure out the problem before October 15, they might be able to drag the case into the settlement stage. Otherwise... they would have to pray to God that Magnavox hadn't offered incentives to those law firms, such as forcing Ethan Jones to stop selling 'Snake Game' nationwide, so the lawyers could get more money.

...

At eight o'clock that night, a brand-new Dino 246 GTS parked in front of Evelyn's house.

The red streamlined body reflected a faint pink glow under the moonlight, like a bedside night light, warm and soft.

Sitting in the car, Ethan looked apologetic as he gazed at Evelyn, saying, "Sorry... this issue is my fault, and I'll find a way to figure out the reason."

"Okay~" Evelyn waved her hand, saying, "What did you say to Barbara earlier? Asking her not to take responsibility? I'm saying the same thing to you now. Don't take responsibility because this is not your fault."

"I created 'Snake Game,' I drew the circuit diagrams, so I know how absurd this patent is."

"But there's nothing we can do, right?"

"Professor Vinton said that Professor Ralph Henry Baer might not have as much fame in the circle as President Fred Terman, but everyone in research knows how terrifying his invention ability is."

"The federal patent office may not understand technology, but they understand communication."

"So, our failure is normal. It's not their ignorance, but our powerlessness."

"Just treat it as..."

"Spending money to buy a lesson."

Evelyn unbuckled her seatbelt, opened her arms, and smiled, "Hug?"

Ethan laughed at her words, without hesitation, he embraced her.

"Thank you."

He whispered.

However, before he could admit his misfortune and decide to give up most of the profits from 'Snake Game,' before he even entered the house, a series of urgent phone rings suddenly entered his ears. He went inside, picked up the phone, and a sudden roar hit him—

"Ethan Jones!!!"

"Where the hell did you go!!!"

"I've been calling you all day, and no one answered!!!"

"Your 'Snake Game' is actually an infringing product???"

"Oh! Sxxt! Magnavox's complaint has been sent to me!!!"

"At the same time, they have also sued Midway Games and Chicago Coin!!!"

"Dxxm! Do you know your actions will cost us a lot of money!!!"

"You have to explain this to me! I'm at the company right now! Come over immediately!!!"

'...'

The machine-gun-like speed of speech and the abrupt ringing of the phone made Ethan shake his head with emotion.

Shaking the copy of the complaint in his hand, he carefully looked at it. Indeed, there was no name of Atari in the defendant's column.

"Alright, the worst outcome."

Ethan sighed, thinking of what Barbara had just said.