Patent Trolls: The Complete Guide
We have one-time IBM patent lawyer Peter Detkin to thank for the phrase “patent troll.”
In Detkin’s time, the phrase almost always referred to the practice of buying low-value patents for the purpose of threatening nuisance litigation.
The easiest way to define the phrase for today’s world is to say that it refers to any person or group that uses patent law outside of its intended purpose.
More specific definitions exist, but it’s best to start with a broad understanding before moving into the details of the trade.
Patent trolls are people or institutions who use patents to make quick money without having any financial stake in the patent they claim is being infringed.
Instead of using patents as a basis for creativity or for the production of a valuable good or service, patent abusers use these them to rack up licensing fees.
According to a 2014 study by the group Patent Freedom, patent lawsuits of this type have increased by an average of 22% per year since 2004.
This practice is similar to corporate squatting.
How common is it? In the same study from above, Patent Freedom estimates that 40% of all lawsuits in the industry this year will be put forward by people exploiting patent law.
The problem is so bad, start-ups are forced to put together their own patent portfolios (however flimsy the claim) to attempt some defense against future infringement lawsuits.
Below is my complete guide to the various abusive patent practices currently used.
I cover everything from the basics of the practice to the latest examples and case studies available.
DISCLAIMER: This content is for educational purposes only. For me, it’s a form of entertainment. I am not a patent lawyer (I am a trademark attorney) but I happen to find the subject of patent law interesting. Since I’ve learned a lot about the subject from personal research, I figured I’d be good at putting together a general guide. Nothing in this article should be taken as legal advice, and I do not vouch for the accuracy of any information found at the sites I link to.
Table of Contents
- Chapter 1 – What Is a Patent Troll?
- Chapter 2 – Patent Abuse History
- Chapter 3 – How Patent Trolling Works
- Chapter 4 – Famous Patent Abuse Incidents
- Chapter 5 – Dangers of Abusive Patent Practices
- Chapter 6 – Patent Abuse and U.S. Law
- Chapter 7 – Case Studies in Patent Abuse
- Chapter 8 – How to Deal with a Patent Abuser
- Chapter 9 – The Future of Patent-Trolling
- Chapter 10 – What Can You Do to Help?
What Is a Patent Troll?
Like any buzz-word or catch-phrase, not every definition of “patent troll” agrees.
Rather than depend on a dictionary definition, you can understand the practices of patent abusers by simply reading about what it is they do. Observe their behavior for yourself and you don’t have to take anyone else’s definition for granted.
The links here describe the modern practice of abusive patent law. I’ve tried to include a few different perspectives here, with a couple of dissenting voices below that defend the practice as a legitimate business strategy. If you read through this list of links in sequence, you’ll get a great sense of the role these activities play in everything from patent law to Net Neutrality with some absurd stops along the way. I hope that you’ll have a full understanding of the concept of patent abuse after reading through these helpful links.
Patent Abuse History
Though the popular phrase describing it has only been with us since the early 1990s, the practice of patent abuse is nothing new. The reason you’re just now hearing about it is pretty simple – the Internet. Not only does the Web make it easier to disseminate complex business concepts, it’s also driven up interest in privacy and other hot-button issues. It’s much easier to create a movement when you’ve got Facebook and Twitter at your fingertips.
The links below will lead you to information on the practice of patent abuse, specifically details showing that people have been at this since the earliest days of patents. I’ve tried to include multiple perspectives here, as with the rest of the article, to maintain some sense of balanced reporting. If you’re at all interested in the American legal system or anything in the business world, you’ll enjoy these articles.
How Patent Trolling Works
It’s one thing to understand what the definition of the phrase is. Understanding how the process works is a bit harder. That’s partially because of the complex nature of patent abuse, and partially because the practice exists in many different forms. It doesn’t help that it is in the best interest of patent abusers to hide their tactics. I want to help you cut through that smokescreen by showing how they actually go about the business.
I think understanding how the process works is crucial for those who want to put an end to the process. But I suppose some of the information in the links below could also be used to teach someone how to start their own patent-trolling process. I hope that’s not the case, but in the interest of providing a complete guide, I’ve tried to include a variety of voices on the subject.
Famous Patent Abuse Incidents
As these practices became widely-known, cases involving patent abuse started to appear in headlines and popular Web-based news stories more often. The immediate result was increased awareness about the problem. An unfortunate result was a slight case of fatigue. Too many stories appeared in too short a time for the public to stay interested.
Even so, these high-profile patent abuse stories had a big impact on the practice. They may have made people a bit numb to the idea of patent reform, but billion-dollar settlements and corporate alignments are always going to be of interest to the federal government. The links here go to famous stories about patent abuse. You can learn a lot about the practice by reading about how famous cases of it in the past have played out. Take note – not all of the examples are explicitly about “patent trolls,” but are all relevant to contemporary patent law.
Dangers of Abusive Patent Practices
So what’s the big deal with this type of patent law practice? Why is it such a bad thing? After all, some of the links above defend the practice. I’ll admit that sometimes the line between legitimate patent practice and outright patent abuse can be very fine. You may also think that you aren’t affected by this kind of behavior. Maybe you own a small business or work for a big corporation and can’t see how patent abuse affects you directly.
If this type of behavior seems like something that only affects big corporations, read on. I’ve included the links below to show the practice’s potential for harm. I’ve tried to steer clear of scare-tactics, but even so the potential for danger seems too great to ignore, at least in my opinion. Here are examples of how this practice is affecting American business and innovation.
Patent Abuse and US Law
As a legal professional, when I first heard about the concept of patent infringement abuse, I was naturally curious about what the law had to say about it. Patent law is closely related to trademark law, which is my field. With all the developments in the past two or three years, it’s been the perfect time for me to get interested in patent abuse. The US government is finally paying attention to the issue, and is beginning to actually do something to stop patent abusers in their tracks.
I’ve included a variety of links on legal approaches to the problem, including some legal defenses of the activity. The legal climate regarding patent trolls has changed a great deal in just the past couple of years. If you want to get up-to-date on the latest news about patent abuse, the links below should give you a complete education.
Case Studies in Patent Abuse
I consider case studies to be one of the best sources of unbiased information, and I think that fact is borne out here. You’ll read plenty about bad behavior on the part of patent abusers, but you should also get a new perspective on exactly what kind of abuses we’re talking about. I’d like to say that patent trolls don’t live up to the bad reputation they’ve earned, but for the most part that’s not the case here.
I’ve come across some very interesting patent abuse cases during my years of interest in the subject. Here are links to some particularly interesting cases. Included are details on both sides of the argument over the improper use of patents by non-practicing entities.
How to Deal with a Patent Troll
Not everyone reading this will actually have to deal with a real patent abuse case directly during their life time. As I said, this post is for entertainment and education purposes. But just in case you are reading this to prepare for your own fight, I wanted to include some links from experts on what you can do to prevent being targeted for patent-trolling.
I also think the links below are educational, even for those who aren’t going toe-to-toe with this problem themselves. I learned a lot about how this practice work by reading these links, and I think that kind of education is important for everyone learning about US patent law abuse.
The Future of Patent-Trolling
A few years ago, I would have written something very dark in this space. I would have told you that patent abuse was likely to continue for years, that there was nothing much we could do about the problem, and that it was unlikely that their behavior would be regulated or addressed by the government at all. Thankfully, that’s not the case anymore.
As the federal government starts to show interest in shutting down patent abuse, it should be no surprise that patent trolls are developing new ways of gaming the system. What does the future of patent abuse look like? The links below are a collection of answers to that question.
What Can You Do to Help?
If I’ve done my job right, by the time you’ve read this far you’re just as upset about these practices as I am. But there’s good news, as we saw in the last category.
If you want to help end the patent-trolling phenomenon, you’ve already taken the first step by educating yourself. To continue the fight, check out the links below. Some go to further reading, some suggest actions everyone can take to combat the practice. They’re all powerful tools we can use to take back the patent system from those who abuse it.
Ever since President Clinton signed the Digital Millennium Copyright Act in 1998, the federal government has slowly been moving toward direct action on patent abuse.
It’s a good thing that the United States government is beginning to address intellectual property laws, and we have the Internet to thank for this development.
A major debate exists today between those on the side of patent trolls and those who see them as a plague on small business and innovation. Those who defend the practice point out that the industries that engage in the most “patent abuse” are responsible for 2/5th’s of the American GDP. They suggest that evidence showing a negative impact on the economy from the practice is either misguided or a blatant fabrication.
Regardless of which side of the debate is winning, it’s clear that American patent law is moving away from the draconian rules that once dominated the corporate landscape.
Patent reform is the new name of the game.
In recent months I’ve seen President Obama and his cabinet take significant steps to curtail the activities of patent abusers.
But, as President Obama admitted himself, though the government has made some progress on the topic, their job is only half-complete.
So long as the federal court system continues its broad interpretation of proposed and existing patent reform legislation, those who abuse the patent system are in danger of losing their grip on the court rooms and board rooms of the United States.