Michael Feldstein

This is a guest post by Jim Farmer.

“Today the four firms providing electronic transcript services [to U.S. colleges and universities and school districts] have agreed to form a network so transcripts will be delivered to any user of their service regardless of where the transcript originated.” Speaking from hastily-written text, Larry Furth, Executive Director of the School Interoperability Framework Association (SAIFA) announced the agreement at the 5th Annual Conference on Technology & Standards in Washington, DC. The panel discussion on Emerging Standardization was delayed fifteen minutes as the four panelists reached agreement. The agreement is expected to be announced formally later this week. Mark Johnson, President of the National Transcript Center, John O’Connell, Senior Vice President of Business Development for Docufide, Craig Powell, President of ConnectEdu Inc., and J. Michael Thompson, Chief Executive Officer of XAP Corporation were speaking on Emerging Standardization Efforts and Trends.

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Read the rest of Real-time College and University Transcripts Coming (336 words)

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I’ll be traveling to St. Paul, MN on Sunday for the JA-SIG conference. I’ll be there all week, including the post-conference Sakai planning sessions on Thursday and Friday. I’m a co-presenter for one session with Unicon’s Cris Holdorph on integrating Sakai with Peoplesoft. Other than that, the most likely place you will find me during the day is in the sessions from the “Community Source Management/Governance” track.

Feel free to ping me or just track me down if you want to meet up and chat.

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Here’s an interesting bit from D2L’s patent blog:

Clients have been calling us to let us know that Matthew Small, General Counsel of Blackboard, has been calling them. From what we understand, his purpose appears to be twofold: (1) to encourage clients to switch to Blackboard ; and (2) to create FUD (fear, uncertainty, doubt) with respect to alternative products and services in the eLearning space.

From what we gather, he has been making statements that are not supported by the record in the Court or by the actions of the Patent & Trademark Office. If your organization is called, we invite you to suggest to Mr. Small that we are always willing to engage in an open dialogue with you and him.

We remain confident that Learning Environment version 8.3 is an appropriate design-around to the patent claims – as we announced nearly one month ago. We also remain confident that the patent’s claims are invalid and that the Courts and the PTO will ultimately invalidate the patent.

As there is no www.factcheck.org for this litigation, we continue to encourage you to review the documents and the facts. We are happy to discuss any questions that any client, or other interested people, may have. Just let us know!

John Baker, President and CEO (John.Baker@Desire2Learn.com)
Diane Lank, General Counsel and Director, Legal Services (Diane.Lank@Desire2Learn.com)
John McLeod, Director of Marketing (John.McLeod@Desire2Learn.com)

It’s unsurprising that an aggressive company engaged in a lawsuit with its competitor would use the suit to try to poach customers. But I’ve never heard of a company having their lawyer act as a sales guy. If it’s true, it certainly demonstrates a pretty high level of chutzpah.

I’m very curious to find out more.  If you’ve received a call like this or know anybody who has, let me know. I’m particularly interested in who called and in what factual claims they made about the legal situation.

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Jim Farmer has an interesting guest post over at Seb’s blog about SpikeSource supporting Moodle on Windows/IIS. Both the creation of supported softwares stack for higher education and the mixture of proprietary and open source software in at least some of those stacks strike me as natural steps. I expect that we’ll see more of this kind of thing.

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Update: The dates of the conference are actually June 19-20. Sorry about that.

(Patrick will never let me live this down.)

My friend Patrick Masson has put together a two-day conference at Delhi, NY on May 23-24 that looks terrific. The first day, which is about open source in higher education in general, has tracks on quality, total cost of ownership, and external support. The second day is a Moodle Moot. I’ll be one of the speakers.

Be there or be rectangular, as they say.

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Barry Dahl read the Sakai Foundation’s recent announcement about the Blackboard patent pretty closely and is concerned that it sounds like they think the fight is over. I completely understand why he interpreted it that way, but I read it a little differently. If you look closely at the specifics of the legal situation, the Foundation’s position begins to make a lot more sense.

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Read the rest of What the Sakai Announcement Means (584 words)

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A few of the usual suspects have pointed to this one already, but in case you haven’t seen it yet, Barry Dahl has a fantastic podcast interview up (about 30 minutes) with Michael C. Smith, an intellectual property lawyer in the district where the case was filed and author of EDTexweblog. Both interviewer and interviewee did a terrific job of really illuminating some of the legal nuances.

There is one point that bears revisiting, though. Michael, in answering Barry’s questions about the USPTO re-examination, appeared to assume that the re-exam was ex parte. This is a perfectly reasonable assumption, since ex parte is far more common a challenge type than inter partes. Nevertheless, the D2L/SFLC challenge is actually inter partes (or, to be more specific a weird hybrid of ex parte and inter partes that mostly follows inter partes rules). Some of Michael’s answers would probably be unaffected by this difference, e.g., the likelihood that the USPTO ruling will affect the prior court ruling. But some, like the probability of a successful USPTO challenge, how this challenge fits into a larger litigation strategy, and how the judge might react to the challenge going forward, could. I’d be really interested to hear whether any of Michael’s answers change based on this information.

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Blackboard has posted their response to the USPTO ruling. They make some claims about how this will impact the trial, which I’m not in a position to evaluate just yet. They mention that all of the claims in the re-examination request “were unsuccessfully raised by Desire2Learn during recent litigation,” which is irrelevant since these are different forums operating under different rules with different burdens of proof. But what really gave me pause was their statistic. They claimed that “more than 90% of patents that undergo reexamination of this kind ultimately are upheld.” That didn’t seem consistent with the statistics that I remembered. Where did that number come from?

Funny story, that…

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Read the rest of Blackboard Fails Statistics 101 (333 words)

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This just in:

On March 25, the U.S. Patent & Trademark Office issued its Non-Final Action on the re-examination of the Blackboard Patent. We are studying the document, found here, but in short, the PTO has rejected all 44 of Blackboard’s claims. We caution that this is a NON-final action; both Blackboard and Desire2Learn will have an opportunity to comment before a final action will issue, and after that, the decision will be subject to appeals.

This decision actually should have come before the trial verdict but was held up because the USPTO had to decide what to do about the separate filings from D2L and SFLC. Now, in addition to the fact that Blackboard will be able to argue against the ruling with the USPTO, there are a number of questions regarding how this affects the court case. Will the damages finding still stand? Will the USPTO ruling render moot D2L’s post-trial motion before the judge regarding invalidity? If not, will it imact that ruling? What happens to the issues of royalties and injunction going forward? I think that I know the answers to some of these questions but don’t want to post anything until I have some more authoritative information.

Stay tuned.

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I have mentioned before Cambridge’s My Sakai project which, writ large, can be seen as an attempt to make Sakai more compatible with Web 2.0 by supporting development of widgets, gadgets, Facebook applications, and so on. Well, they’ve made some substantial progress of late, inspired in part by the Apache Shindig implementation of Google’s OpenSocial API. They’ve created a development paradigm that mostly eschews Java in favor of the HTML, Javascript, and RESTful web services that most Web 2.0 developers will find very familiar. The work, still very much in the experimental stage, recently culminated in a four-day workshop in which 4 Sakai schools (Cambridge, Michigan, Georgia Tech, and U of Toronto) created a new and more user-friendly interface for file sharing within Sakai.

Here’s how some of the participants described the effort and its results:

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Read the rest of Mashing Up the LMS the Google Way (844 words)

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I’m getting occasional reports from people that they’re getting error messages when they try to submit comments hereon e-Literate. (Something about headers.) Rest assured that, despite whatever the error message is telling you, your comment is getting into my blog and trapped by my spam filter. I check that filter daily and will release your comment (assuming its appropriate) as soon as I see it.

Sorry for the inconvenience. I may be switching to a different comment spam filter in the near future.

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The American Association of Community College’s Instructional Technology Council (ITC) has just published its 2007 Distance Education Survey Results, covering data from 154 U.S. community colleges. And there’s a lot of interesting stuff in it. Here are the headlines that I drew from it:

• Distance education continues to grow at a very healthy clip, particularly in this market segment.
• Blackboard is losing market share rapidly
• Moodle doubled it’s market share in the past 12 months and now has the highest market share after Blackboard/WebCT in this market segment.
• ANGEL and D2L also grew their market share.
• We have reason to expect more LMS churn in the near future, which is bad for Blackboard.
• The top 5 areas of likely distance learning-related service growth in this segment are (1) online student organization web site and services, (2) online counseling and advising, (3) online plagiarism evaluation, (4) audio/video streaming, and (5) online textbook sales.

As you can imagine, the LMS market share stuff is what interests me the most at the moment.

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Read the rest of Bad News for Blackboard, Good News for Moodle (742 words)

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EDUCAUSE has posted a presentation by SUNY Delhi’s Clark Shah-Nelson on their transition from WebCT CE to Moodlerooms-hosted Moodle. It’s quite good. By all accounts (including the presentation), it has been a pretty smooth transition for Delhi. But the biggest deal is the cost comparison, which Clark lays out in his slides. The total cost is just way cheaper than the alternatives. Particularly for schools that are just looking for a decent all-around LMS and don’t have very specific functional or integration needs, the Moodlerooms offering is tough to beat.

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I’ve been meaning to comment on D’Arcy Norman’s frustrations with not being able to export Moodle courses to a common standard. He makes a very important point:

Moodle happily ingests those formats, acting to absorb content into what then becomes an inescapable pit of quicksand. It’s a one-way trip. Content can check in, but it can never leave.

If Blackboard did that, there would be villagers marching in the streets with torches in hand. The Blackboard SCORM import/export stuff might not be perfect, but at least they try to let people move content out.

With Moodle, it’s currently a vendor lock-in proposition. The only saving grace is that the vendor just happens to be an open source project. But it’s still lock-in.

Now, I don’t know any of the specifics around Moodle’s export capabilities but, in general, universities should insist on support for some standard export capability in any platform they adopt. We all know that the cost (in time and/or dollars) of moving content from one system to another is one of the major barriers to universities who would otherwise be motivated to switch. So unless you plan on sticking with your next platform forever, make sure you press your vendor or open source community hard about supporting some sort of content exit strategy. Heck, even if your school loves Moodle (or whatever) and plans on staying with it as long as, say, John McCain wants the U.S. to stay in Iraq, individual teachers move from school to school and, depending on their contract, are usually entitled to take their course content with them. That is, if they can get it out of the LMS.

To be fair, supporting a robust, standards-based export facility is a hard problem, in part because we keep adding tools to our learning environment and each tool needs an import/export format to work in the standard. Nevertheless, basic support for export (focusing maybe on a handful of widely used tools) is far better than none.

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There’s a very interesting interview of Desire2Learn CEO John Baker and General Counsel Diane Lank in T.H.E. Journal. It’s a particularly good read if you haven’t been keeping up on the details of the trial, but there’s also good stuff in it for people who have been following closely. For me personally, the biggest bit of news in the article was this from John Baker:

$3.1 million is a lot of money, but it’s certainly not putting us in any financial jeopardy whatsoever. We’ve been very fortunate to have incredibly strong clients over the years, some of which pay almost that much money as an individual client. So we’ve been very, very fortunate to have good clients and good cash flow—no debt—we’ve got a very strong cash position. So we could pay that, without actually skipping a beat, and continue to be profitable this year and going forward. So from a financial perspective, it’s one of the concerns people have raised over [the course of the trial]. In the early days, $3.1 million was a lot of money for us. Today it doesn’t even come close to our R&D budget within our organization.

So we’re quite comfortable; we’re still hiring a lot of people; we still intend on growing; we’ve obviously launched new products; and we’re actually going to be launching more later in the year. So we’re intent on keeping our innovative edge and [focusing on] the clients and client success.

What’s interesting is we actually think that by all of our clients moving to 8.3, it’ll actually result in us having to support less versions of our application. Instead of being like Blackboard, where they’re probably supporting about 20 different versions of the application, at tremendous cost, we’re going to be supporting one, which will probably shave millions off of our costs [which will be applied to] new projects, new technology. We’re going to better support our existing clients. Or to focus our energy on the next version, the 8.4 version, or the 9.0. So we’re actually quite excited. We’re actually trying to find the silver lining in this and put ourselves in a better position than we were [in at the start of this]. Now, it’s not what we wanted to go through, but we can afford to pay it.

And then, what might happen is that if we lose on appeal, there’s nothing else we have to pay. We’ve got that workaround put in place. So that one-time cost for us is something that we can absorb. Some of the things we’re going to be asking the judge to do is to reduce that as well, if he doesn’t eliminate it altogether.

Because D2L is not a publicly traded company, we’ve had no visibility into their financial situation and how the suit was affecting them. If they can manage to get the injunction cleared up (particularly it is cleared up by the judge accepting their workaround), then they may come out the other side of this just fine.

Also, they’re still cranking out product. Version 8.3 appears to be a fairly robust release with a lot more functionality than just the patent workaround, and they have a new and impressive sounding ePortfolio product. (I highly recommend Barry Dahl’s podcast interview with D2L’s lead product manager Kenneth Chapman.) Their management team must be really good, because I never would have predicted that a company their size would have the cash reserves to manage under this sort of financial burden and the focus to keep developing with this much distraction.

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For any of you who were thinking about submitting an article for the On the Horizon issue I’m editing on breaking up the monolithic LMS, please remember that abstracts are due by April 1st. (Details are in the original post linked to above.) Articles need not be heavily researched with tons of footnotes (although those are welcome, of course); I’m looking for practical, experience-based insights that could help teachers and universities that are interested in finding out about innovations that they can use or that might be coming down the road soon.

Also, the April 1st deadline is just for a short abstract. You’ll have plenty of time to write the full article. So if you have an idea but haven’t done any work on putting a paper proposal together, there’s still time.

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As I noted in an earlier post, I’m traveling this week, so this post is going to be relatively short and light on analysis. If you’re trying to get a comprehensive picture of what’s happening, I’d start with the article in The Chronicle. (Incidentally, Katherine Mangan, who is new to the edupatent beat at The Chronicle, has been doing a good job of capturing some of the legal nuances that I haven’t seen covered in most of the other mainstream media stories.) Next, you’ll want to check with Al and Barry. Like both of these guys, there are some aspects of the ruling that I’m still trying to process. The judge came down with a pretty tough injunction against D2L along with some strict orders about how and when D2L must inform customers and prospects. The judge has placed an injunction on D2L regarding existing customers as well as new ones, which was more than Bb asked for. On the other hand, he also gave D2L a 60-day grace period to try to implement a work-around and pushed the two parties to negotiate a royalty settlement. You can find the rulings here and here.
To my mind, there are two crucial details that we’ll find out in the short term. First, we have to see whether D2L’s work-around allows them to get a non-infringement ruling. In addition to being crucial for D2L and their customers going forward, this will be another indication of just how hard the patent is to get around and therefore how much liability risk other systems will face. Second will be the royalty settlement. If Blackboard gets a royalty anywhere close to the 25% that they are asking for, that will be very tough for D2L or any other competitor found to infringe. If outcome breaks for Bb in both of these outcomes, then Bb will effectively have a legal stranglehold on the product category.

Update: D2L has a new post up on the orders. Here is their interpretation of them:

The combination of these orders is consistent with Desire2Learn’s expectations from the hearing. On March 10, the Court discussed two activities: first, that Desire2Learn go to market as soon as possible with a product that would not infringe, and second, that the parties make a good faith effort to talk about what payment should be made for use of any infringing products that may still be in use. Blackboard has consistently represented that it intended for Desire2Learn to be able to serve existing customers; that it was seeking not an injunction, but rather a reasonable royalty, for those clients. The Court’s order for the parties to meet requires discussion about a reasonable royalty.

Moreover, the 60-day stay period provides Desire2Learn with the opportunity to finalize and to implement its design-around, as we mentioned yesterday. At the hearing, the Court based its willingness to issue an injunction in part on the fact that we could easily, inexpensively and quickly design around the Blackboard patent claims. The product that we anticipate will include the design around – Learning Environment version 8.3 – will be available to all clients and prospects quite soon. Further, since the trial we have not, and will not, sell any product found to have been infringing.

Finally, the stay period provides an opportunity for Desire2Learn to file its post-trial motions to limit the scope of the injunction and request other relief. For example, we intend to file a motion that, that as a matter of law, D2L does not in fringe the patent respect to clients hosted in D2L’s Canadian facilities. The injunction should be narrowed and damage award reduced to reflect this.

In related news, Katherine Mangan has a report on the new edupatent suit (the one in which universities are being sued) that confirms the details that I had posted earlier. A lawyer representing the patent troll is quoted in the article as saying, “Nonprofits don’t need to worry about us chasing them. We’re an ally of theirs.” Recall that Bb promised D2L’s existing higher education customers would not be impacted by their request for an injunction. Clearly, children should not be allowed to play with loaded guns. Unfortunately, many of the parents are too busy loudly defending their right to bear arms while not paying attention to the fact that they left their own gun cabinets unlocked and in easy reach.

We’ll have more here as soon as we can, including some analysis from Jim Farmer on the long-term big picture.

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I’m leaving tomorrow for the Oracle Higher Education Users’ Group Conference and will be gone most of the week. Anybody who will be there and wants to chat can find me in the audience at either of the SAIP presentations or at the Oracle booth on Tuesday from 2-3 PM. As for the blog, I’ll do my best to keep up on major developments, but I may be a little slower than usual.

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Al Essa informs us that there is a new edupatent suit by a new player. The critical difference here is that this time universities are being sued. At the moment, the company asserting the patent has confined itself to suing for-profit universities (University of Phoenix, Inc, The Apollo Group, Inc., Capella Education Company, Laureate Education, Inc., and Walden University, Inc.). But there’s nothing that legally prevents it from suing any university. Nobody is exempt from liability exposure.

I have argued from the very beginning of the edupatent mess that the problem is much bigger than one patent. Nor will this next one be the last.

Here’s what I know so far, what the implications are, and what we need to do about it:

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Read the rest of The Other Shoe Drops (688 words)

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Barry Dahl has posted some comments from John Baker regarding whether the possible backlash against Blackboard for the suit will have universities tar all LMS vendors with the same brush and move to open source instead. John made two points in response. First, John expressed faith in the educational community (based on feedback that D2L has gotten from their customers) that they will be able to see that the problem is vendors who assert patents for educational software in particular rather than proprietary software vendors in general. Second, he asserted that, if D2L succeeds in implementing a work-around to the patent that earns them a court ruling saying they no longer infringe, then they will be uniquely inoculated against the patent in a way that no other LMS vendor (other than Blackboard itself) could claim.

I think John is probably right on both counts. In fact, he’s indisputably right on the second count. If D2L gets a non-infringement ruling at some point (which is not a given), and if the patent is not invalidated outright on appeal or by the USPTO, then D2L will be safer from the effects of the patent than any other platform going forward. While it’s true that Blackboard’s pledge is legally binding, it’s also true that the pledge is complex and the boundaries of it have never been tested in court. For example, what is the legal liability of support vendors for open source LMS projects? Nobody can say with certainty.

On Baker’s earlier point, I see no evidence that university folk are rejecting vendors in toto. If bad feelings toward Blackboard because of the patent do result in substantial defections by Blackboard customers (also not a given), my sense from the educational community is that the relatively few people who view this as proof that all vendors are inherently bad are the ones who had already believed that to be true and see the lawsuit as confirming their current views. The majority of academics that I talk to see the root of the problem as being with one particular company and, possibly, with the US patent system. If anything, D2L may get a “good ethics” boost with some university decision-makers that could help them win in cases where the competition is a close one. I do think that the open source projects probably will benefit disproportionately from any flight away from Blackboard, but only because I think more institutions are willing to seriously consider adopting an open source LMS than there were a couple of years ago. It will be a level playing field with more viable players.

Update: D2L has asserted in their latest court filing that the Blackboard pledge has some deliberately crafted legal holes in it:

Bb may assert that the “patent pledge” insures continued competition by open source providers.. However, it appears that Bb has not truly surrendered its the ‘138 Patent against those entities. Bb has preserved arguments that so that it could revoke its Pledge and sue. For example, Bb has repeatedly stated that it does not know whether other companies infringe, yet knowledge of the act sanctioned is required for estoppel. See Young v. Amoco Production Co., 610 F. Supp. 1479, 1487 (E.D. Tex. 1985). Also, to prove estoppel any potential defendant must prove that it relied on Bb’s Pledge, and not on the advice of counsel as to its rights. See Hall v. Aqua Queen Manufacturing Inc., 93 F.3d 1548, 1558 (Fed. Cir. 1996). It would appear that Bb has carefully protected at least both of these escape routes.

The real problem D2L faces in terms of customers is the current uncertainty about how far the suit will go. Universities tend to be highly risk-averse and the lawsuit understandably makes them nervous. What is lost in a lot of the discussion on individual campuses, I think, is that no platform is indisputably safe from this patent at the moment.

Blackboard Inc., Desire2Learn, edupatents addthis_url = 'http%3A%2F%2Fmfeldstein.com%2Fon-safety-and-values%2F'; addthis_title = 'On+Safety+and+Values'; addthis_pub = '';

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