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Crowdfunding Portal Kickstarter Dragged into Patent Lawsuit: Why?
© Image: Anton Root / Crowdsourcing.org
editorial

Crowdfunding Portal Kickstarter Dragged into Patent Lawsuit: Why?

Editor's Note: Creative Barcode's CEO Maxine Horn wrote the following article about Kickstarter's recent naming in a patent infringement lawsuit; we are reposting the piece with her permission. You can find the original here, and make sure to follow Creative Barcode on Twitter. For more on the story, check out our write-up, which provides additional context. 

Following major PR about one of Kickstarters’ most successful fundraising successes involving Formlabs, a rival 3D printing company 3D Systems has launched a law suit for patent infringement not only against Formlabs, but against Kickstarter as well.

3D Systems claims Kickstarter acted as ‘sales agent’ – however, common opinion is that 3D Systems, whose patent expires in January 2014, only pursued Formlabs (not yet selling any product as yet in USA anyway) in an attempt to curtail their production of a far more affordable 3D printer and use up the successful fundraising in legal fees.

In my humble opinion, dragging in Kickstarter could merely have been a strategy to ride off of the PR interest such an action would attract.

Kickstarter is not a sales agent and does not profess to be. It is a crowdfunding business and earns its income not from a percentage of sales of products or equity stake but purely from 5 percent retention of the total funds raised. The success of this ‘one’ project may have in this instance equated to around $150,000 gain for Kickstarter but the majority of projects raise between $5,000 to $30,000 dollar where 5 percent retention is marginal.

However, Kickstarter's financial gain is a red herring. The real issue is why should a crowdfunding platform be accountable for the patent infringement when responsibility for due diligence lies with project creators and their professional advisors?

If Kickstarter is held accountable would it follow that any portal owner including trade associations, ideation sites, product sales sites and so forth could be held accountable for anything promoted on their sites that later became subject to an IP infringement suit? Would that mean therefore that any site that sold and promoted Samsung Galaxy phones could have been dragged into the Apple copyright infringement case?

An issue it does raise is one Creative Barcode has highlighted on several occasions in context of crowdsourcing, crowdfunding, open innovation, and creators' IP status in general, and that is those running such activities and those participating in them must utilise a means to authenticate submissions.

Overall, it is the creator's responsibility to confirm authentication of their concept submissions as authentic and produced and owned by them, and that it is theirs to disclose to third parties, whether direct to companies or uploaded to portals.

In the case of concepts that are subject to patent and or use others non-open-source technology, the creator and/or their advisors are duty-bound to undertake due diligence to ensure they are not breaching another party’s IP.

Far too often, creators focused introspectively on their ‘projects’ stick their heads in the sand when it comes to intellectual property, or boring bits like basic due diligence research.

The same applies when displaying and promoting their completed creative works online. Few creators bother to use Rights Reserved or Free-Use identifiers within those works. Thereby, they fail to take any responsibility to communicate to internet users what the usage terms are or how to identify and contact or attribute works to the creator when works are served up in search engine returns.

And yet they kick and scream copyright infringement if their work is used without permission or payment.

It’s time for creators to start taking more responsibility and become part of the digital IP solution rather than perpetuate the problem.

After all, there are easy and low cost mechanisms available now such as Creative Barcode, Creative Commons, GBR Trust Passports, and I am sure others mechanisms will start to appear.

So there is no excuse for avoidance any longer.

Kickstarter, along with all other such portals and corporate brands and others running open innovation activities, should make authenticity of works and IP usage terms a fundamental part of their submission rules and make it clear to creators that due diligence is their responsibility, no-one else’s.

Here are a few sites who are promoting best practice IP responsibility and easy to use IP authentication mechanisms and identifiers:

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