From: stevens@vms.macc.wisc.edu (PAul STevens - MACC - 2-9618)
Subject: RSA patent suit by PKP
Organization:  University of Wisconsin Academic Computing Center
Date: 20 DEC 92 09:56:52    


Mr. Markowitz wrote the following letter to me, saying that he
had no way of posting it.  I asked if I could post it in his name.
He said that I could and added some comments in reply to my
letter.  All of what follows is from him, including the lines
marked by '>>' which he extracted from my query to him and some
lines which he extracted from my original post.
==================================================================
From:    IN%"Markowitz@DOCKMASTER.NCSC.MIL" 16-DEC-1992 23:57:33.83
To:      stevens@VMS.MACC.WISC.EDU
Subject: RSA patent

Received: from 26.1.0.172 by wigate.nic.wisc.edu; Wed, 16 Dec 92 23:57 CDT
Message-Id: <921217055504.677002@DOCKMASTER.NCSC.MIL>
Date: Thu, 17 Dec 92 00:55 EST
From: Markowitz@DOCKMASTER.NCSC.MIL
Subject: RSA patent
To: stevens@VMS.MACC.WISC.EDU

Paul:

>> My point is that *someone* has to test this patent claim!  How >> can
we force this to happen?  If someone does get sued are we >> all willing
to contribute to the defense or are we all talk, too?

As someone who *has* been sued by RSADSI/MIT (1987-88), maybe I can shed
some light on this.  There are two ways to go about testing the patent:

 1) You can file a challenge with the patent office.  This costs about
    $3000 (with minimal legal help) but is very unlikely to succeed.
    Basically, you must prove the existence of prior art.  MIT spent
    several years successfully convincing the PO this didn't exist.  I
    don't think the PO will consider any other grounds (like the age of
    Fermat's Little Theorem, etc.)

 2) You can file a lawsuit or be sued.  We followed the latter course :-)
    The suit lasted over a year and cost me my wife's entire salary :-)
    and I was only bearing half the cost.  We settled for a consent
    judgement, since our lawyers (and we went through 3 law firms in the
    course of the proceedings) estimated the cost of going to trial at
    about $250,000 (minimum).

This may give you a glimpse at the reasoning used by IBM, Microsoft,
Novell, Lotus, AT&T, etc.  in deciding to license.  It sucks, but that's
our legal system.

BTW:  We received the right to continue to market our hybrid RSA/DES
encryption utility (Crypt Master) to the federal government royalty
free.  We had been doing this up until about 18 months ago, when we
switch over to ElGamal/DES/DSA/SHA (SecretAgent).  Haven't sold a copy
of CM since.

I would have posted to sci.crypt, but my feed is one-way.

Regards,

Michael

----------
  Dr. Michael J. Markowitz, VP R&D    markowitz@dockmaster.ncsc.mil
  Information Security Corp.          708 405-0500, fax: 708 405-0506
  1141 Lake Cook Rd., Suite D         MCI:  363-1959
  Deerfield, IL  60302                CIS: 76206,2617



From:    IN%"Markowitz@DOCKMASTER.NCSC.MIL" 20-DEC-1992 02:45:41.81
To:      stevens@MACC.WISC.EDU
Subject: RSA patent

Received: from 26.1.0.172 by wigate.nic.wisc.edu; Sun, 20 Dec 92 02:45 CDT
Message-Id: <921219234609.866230@DOCKMASTER.NCSC.MIL>
Date: Sat, 19 Dec 92 18:46 EST
From: Markowitz@DOCKMASTER.NCSC.MIL
Subject: RSA patent
To: stevens@MACC.WISC.EDU

Paul:

>> May I post it in your name?  Very interesting.

Sure, especially since I can't remember what I said.  :-) You can also
insert the details:

    RSA Data Security, Inc. and Massachusetts Institute of Technology
        v.
    Digital Signature, Roger Schlafly and Michael Markowitz

    Civil Action No. 87 C 9172  (Judge Ilana D. Rovner)

    United States District Court, Northern District of Illinois,
        Eastern Division

    The Consent Agreement was entered on November 15, 1988.

>> Especially the words about royalty free.  I would never have

Since the NSF funded the MIT work (as well as that at Stanford which
forms the basis of the other PKP patents), the federal government has
always had royalty-free rights to this technology.  It has never been an
issue of the government paying royalties to PKP.  What is at stake in
the DSS controversy is whether the rest of the world (read U.S.)  will
have to.

>> believed that.  I could believe that they would save face by >>
allowing non-commercial use.  Lotus, etc don't care, I assume.

It's not a matter of saving face.  It's a matter of money.  RSADSI's
contract with DARPA called for the release of a free non-commercial RSA
implentation with complete source.  They wouldn't have gotten DARPA
funds to participate in the PEM development at Livermore/TIS (and CDC?)
without this.  (Ever wonder why all that Internet code is freely
available?)  As it is they delayed compliance with the contract as long
as possible.  Sure RSAREF is free--you get what your DARPA tax dollars
paid for.

And just take a look at that code--RSADSI didn't at all hurt their
potential market for BSAFE.  Who'd want to make RSAREF the basis of a
commercial product?  You'd be at a severe competitive disadvantage if
you did--assuming, of course, there was any competition.  RSADSI/PKP
have done their best to discourage any.  Perhaps the way to most
effectively get this stuff out there is to go after PKP with a
anti-trust suit.  At this point we could make it a class-action suit.
:-)

Regards,

Michael

----------
  Michael J. Markowitz, VP R&D      markowitz@dockmaster.ncsc.mil
  Information Security Corp.        708 405-0500, fax: 708 405-0506
  1141 Lake Cook Rd., Suite D       MCI:  363-1959
  Deerfield, IL  60302              CIS: 76206,2617