Public Patent Foundation's Defeat of the JPEG Patent

In the early 2000s, the widely adopted JPEG image format was threatened by an aggressive, multi-million-dollar patent enforcement campaign until the Public Patent Foundation (PUBPAT) stepped in. This article details how PUBPAT challenged and ultimately invalidated the key claims of U.S. Patent No. 4,698,672, which was being weaponized against the global technology industry. By leveraging the patent reexamination process and uncovering critical prior art, PUBPAT dismantled a predatory patent assertion effort, ensuring that the JPEG format remained free and accessible for public use worldwide.

The Threat to the JPEG Standard

In 2002, a company named Forgent Networks, operating through its subsidiary Compression Labs, Inc., announced that it held a patent covering the core technology behind the standard JPEG file format. The patent in question—U.S. Patent No. 4,698,672 (the '672 patent)—was originally filed in 1986 and granted in 1987, describing a method for compressing digital video signals.

Forgent began aggressively monetizing the patent, demanding royalties from dozens of major electronics and software manufacturers, including Canon, Sony, Hewlett-Packard, and Apple. By 2004, Forgent had collected over $100 million in licensing fees and initiated litigation against more than thirty companies that refused to pay. Because the JPEG standard had become the ubiquitous foundation of digital imaging and web publishing, the campaign threatened developers, businesses, and everyday web users alike.

PUBPAT’s Strategic Intervention

The Public Patent Foundation, a non-profit legal organization founded by patent attorney Dan Ravicher to protect the public interest against improperly granted patents, took notice of the campaign. PUBPAT determined that the '672 patent was improperly issued and that Forgent's claims were far broader than what the inventors had actually contributed to the field.

In April 2004, PUBPAT launched a direct legal challenge against the patent. Instead of entering the complex and costly federal court litigation where defendants were fighting, PUBPAT filed a formal request for reexamination with the United States Patent and Trademark Office (USPTO).

Exposing Prior Art

PUBPAT’s filing argued that the '672 patent was invalid because the technology it claimed was neither novel nor non-obvious at the time of its filing. To prove this, PUBPAT presented extensive prior art—evidence of preexisting technology, published research, and technical literature that already described the compression algorithms Forgent claimed to own.

Among the evidence provided was technical literature demonstrating that discrete cosine transform (DCT) coding—the mathematical foundation underlying JPEG compression—had been developed and published by academic researchers years before the '672 patent application was submitted. PUBPAT argued that if the patent examiners had reviewed these earlier publications during the initial evaluation, the broad claims covering JPEG technology never would have been granted.

The Invalidation and Aftermath

Recognizing the substantial new questions of patentability raised by PUBPAT, the USPTO agreed to reexamine the '672 patent in late 2004. In early 2006, the USPTO issued an initial rejection of all 46 claims of the patent.

Following appeals and amendments, the USPTO issued a final determination in 2006 that completely rejected the critical claims Forgent had used to assert infringement against standard JPEG implementations. With its broad claims stripped away, Forgent’s legal campaign collapsed. The company settled its remaining lawsuits for trivial amounts and agreed to stop suing companies over standard JPEG usage.

PUBPAT’s intervention effectively ended one of the earliest and most widespread patent assertion campaigns against an open standard. By using the reexamination process to eliminate a bogus patent, PUBPAT protected consumer technologies, saved the digital industry hundreds of millions of dollars in unwarranted royalties, and established an open precedent for defending critical web standards against predatory patent assertions.