Response to “Rise of the Patent Trolls”

The first thing that strikes me about this article is that the term
“patent troll” carries many different meanings. The definition of patent
troll suggested in the article “Rise of the Patent Trolls” by Joe
Beyers[1] is “a company or business function whose primary business
activity is to acquire patents for the purpose of offensively asserting
them against other companies”. Two further restrictions on the definition
can be inferred from the article: the “trolls” acquire patents with the
intent and primary purpose of threatening and making infringement lawsuits
and; they don’t have any intent on actually commercializing the idea which
they receive a patent for. Wikipedia[2] has many definitions for “patent
troll”, which each lead me to very different views on the activities of
“patent trolls”. I shall look at each of these in turn.

The first definition is “a person or company that enforces it patents
against one or more alleged infringers in a manner considered unduly
aggressive or opportunistic”. This definition strikes me as very broad,
and to some degree a matter of opinion, as what is considered “unduly
aggressive or opportunistic” is up to interpretation. In addition,
whether someone is “aggressive or opportunistic” is not prohibited by
patent law and in fact, opportunism is often encouraged to further
innovation.

The second definition is something that “purchases a patent, often from a
bankrupt firm, and then sues another company by claiming that one its
products infringes on the purchased patent”. To me there doesn’t seem
anything wrong with this if the patent is valid and the claim of
infringement is based on some merit. The patent system was designed to
allow persons who have a valid patent to prevent others from copying their
idea without permission. If another company has invested time and money
into the technology, but did not seek a patent, or check if a patent was
already filed, then the fact that they must pay for their infringement is
not a result of aggressive right-holders, but is really a result of their
own due diligence efforts. In addition, often times, the patent-holder is
not the inventor, and therefore, it should not matter that another company
originally owned the patent.

The third definition is something that “enforces patents against purported
infringers without itself intending to manufacture the patented product or
supply the patented service”. Although it is not a requirement of
obtaining a patent that you must commercialize and market the invention,
this definition is slightly more problematic for me. One of the
principles behind the patent system is to encourage innovation by
disclosure of ideas, such that others can build on what was done before
them. Although people may still able to build on the “troll’s” patent,
the inability to reproduce it may jeopardize their ability to do this, as
well as the public’s ability to use the combined inventions. This could
be seen as wasting the utility of an idea as the patent-holding company
will not manufacture it. Alternatively, any company that decides to pay
the high fees to be licensed will turn around and recoup those fees by
charging higher prices to the end user (i.e. the public). Both of these
points suggest that perhaps the patent system has an interest in making
sure that the public interest is not negatively affected.

The fourth definition is something that “enforces patents but has no
manufacturing or research base”. This is also problematic as patents, and
intellectual property in general, are partially based on the idea of
rewarding the inventor for research and development. In this situation,
the “troll” has had no research and development costs and therefore their
exclusive right seems less justified by the patent principles.

Although I disagree with many of the above definitions of “patent trolls”,
I do recognize that there are some negative effects that can result from a
company who simply acquires patents with the intention of bringing
infringement suits. For example, when a company threatens an infringement
suit which is weak on the merits against a company that cannot afford to
pursue litigation, simply to try and squeeze a settlement.

Therefore, I agree with Joe Beyer that a standardized definition is
needed, but in my view, it should be a narrower definition than the
suggestions above. The definition should be targeted only at those who
are causing harm and whose actions are not supported by the principles of
patents. Alternatively, groups of “sub-trolls” could be made in order to
encapsulate different actions which should be treated differently.

—-
[1] www.news.com/Rise-of-the-patent-trolls/2010-1071_3-5892996.html
[2] www.wikipedia.org

One Comment
  1. If ‘ownership is ownership is ownership’ (1) then a ‘troll is a troll is a troll’. No matter the number nor breadth of definitions, patent trolls are self-serving, ethically void entities that need to be subverted, not encouraged. Creating subcategories of trolls for the purpose of differentiating their treatment will, unfortunately, only offer tacit approval of their behaviour.

    Every definition of a patent troll either explicitly or implicitly suggests their inherent malignancy and greed. Whether they are acting in an unduly aggressive manner or have no intention of manufacturing their patent, their actions neither advance the principles of the patent system nor encourage market development. Even the seemingly harmless, and perfectly legal, act of purchasing patents from bankrupt firms and then enforcing their rights against others can have devastating effects. In all likelihood, trolls purchase patents from desperate bankruptees at well below market value and then threaten legitimate businesses with infringement litigation. These exploitative actions are even more reprehensible if trolls have no intention of developing the patents themselves; in the absence of any replacement products, enjoining successful companies is destructive of producers and consumers alike.

    Patent trolls, no matter how they are defined, must be actively prevented from glibly threatening the opportunism of successful companies. Just like the greedy troll was not rewarded with the fattest billy goat, Gruff,(2) neither should the patent troll be rewarded by the fattest wallet it chooses to attack.

    (1) Intellectual Property Law, David Vaver (pg.6), 1997
    (2) Three Billy Goats Gruff, Peter Christen Asbjørnsen and Jørgen Moe

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