The Future of Patent Trolls

Patents in the technological world are undergoing some of the most challenging times in recent years. From changes to the software patent world following the Alice v. CLS case, to the mobile patent war, patents in the digital world are under a lot of pressure. One of the biggest changes in recent years are the growth of Patent Assertion Entities (PAE) or as some are called Patent Trolls. Recently the growth of patent trolls has been causing a stir in the digital world, one that is harming progress more than anything.

Patent Assertion Entities (PAEs) are firms with a business model based primarily on buying patents and then attempting to generate revenue by asserting them against businesses that are already practicing the patented technologies or licensing out the rights to the patents [3]. It is easy to write these entities off as trolls from the get go but that assertion should not be made so quickly. Indeed there are trolls among the PAE groups that cause nothing but headaches for companies via painful litigation, but the concept behind these groups are entities that collect and simply license out rights to patents. The groups who actively license out patents and do not seek to fight companies are not the problem and hold a valuable purpose in our society, the problem comes from the group that chooses the lower road.

In recent years the amount of cases brought against companies by patent trolls has increased by an alarming rate. By 2012 the amount of cases brought up by patent trolls totaled 62% of all cases [4]. The issue presented by patent trolls is the sheer volume in which they exist. Smaller companies and individuals more often than not cannot afford such lengthy battles of litigation and other large companies are being halted in there tracks as cases pile up on the docket. Chart1

The USPTO has been attempting to fight these battles in place of the companies by requiring stricter and more narrowly defined claims and proof of infringement, as well as attempting to minimize patents that are overly broad and could be used by these patent trolls [1]. In addition other PAE groups are attempting to stop the trolls from the inside. Companies such as RPX Corporation are buying up as many patents as possible to weaken the arsenal of patent trolls, as well as licensing their patents in such a way that it makes it more favorable for companies as well as inventors [2].

The biggest trouble in the end comes from the fact that what these trolls are doing is not illegal. Nothing says companies or individuals can’t buy up patents and enforce them, and patent trolls do nothing but that. Although they are not breaking any laws, that certainly does not mean the companies aren’t morally and ethically in the wrong. The concept behind patents are to foster innovation and progress, not to crush smaller companies who cannot afford to fight back or stand in the way of large companies from moving forward.

It seems as though reform is needed either legally or industry wise in order to fight back. The US Government is attempting to make the role of a patent troll less appealing, with bills being introduced that would force the trolls to pay the costs of the suits especially if they lose, as well as the USPTO putting patent claims and claims of infringement under tighter and more strict regulation [1]. Personally, the implementation of a strict guideline around patent infringement cases may be a saving grace. A system that forbids the claim of infringement in bad faith, or simply in order to collect licensing fees, could be a way to nationally control the patent troll problem and allow the flow of innovation to begin again.

Work Cited:

[1] “Hatch introduces measure to stop patent trolls” The Ripon Advance. November 4, 2013. Retrieved November 4, 2013.

[2] “Microsoft, Apple Withdraw from Android Patent Trolling: Is the Patent War Drawing to a Close? | ExtremeTech.” ExtremeTech. Web. 28 Apr. 2015. <http://www.extremetech.com/extreme/196432-microsoft-apple-pull-back-from-android-patent-trolling-is-the-patent-war-drawing-to-a-close>.

[3] “Patent Assertion Entities (PAE) Study.” Patent Assertion Entities (PAE) Study. Web. 28 Apr. 2015. <https://www.ftc.gov/policy/studies/patent-assertion-entities-pae-study>.

[4] “Patent Trolls by the Numbers.” PatentlyO. Web. 28 Apr. 2015. <http://patentlyo.com/patent/2013/03/chien-patent-trolls.html>.

 

Eric

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