Google alongside Red Hat, BlackBerry, and EarthLink is pushing the Federal Trade Commission and the Department of Justice to pay greater attention to patent assertion entities (patent trolls), or more commonly termed Patent Privateers. These privateers have become a detrimental part of the tech industry as they embroil companies in expensive litigation over bogus claims on technologies.
Google claims that the "asymmetric warfare" has cost the United States $30 billion in 2011, and $80 counting all direct and indirect costs. Asymmetric warfare is a tactic used by patent trolls who buy and split legitimate patents from companies and then go on to sue other companies for using them on multiple fronts--even though the patent trolls have no intention of actually manufacturing any of the patents they are suing for. These patent trolls have come to make a living solely by asking for money to stop them for suing. On Google's Public Policy Blog, it states that "Trolls are hurting consumers and are increasingly going after small businesses, hampering innovation, and reducing competition."
According to TechCrunch's article on patent assertion entities (PAE), PAE's comprise 62% of all patent law suits now (as displayed on the graphic below).
As rumor has it, Congress is considering requiring trolls who lose cases to pay court costs, which is a hefty part of what makes these litigations so expensive, for both sides. Since patent trolls have been enjoying their sweet ride of winning money or losing nothing, if Congress passes this law, patent trolls may finally be forced to consider their actions as they will have something to lose in the process.
While it's not surprising that 62% of all patent law suits now come from patent trolls, it is strange that patent trolls have been so successful in (continually) exploiting the United States patent system. The time it has taken for Congress to even consider a response is simply ridiculous, but hopefully the new law is eventually passed.
ReplyDeleteI just hope the new law is focused solely on trolls and not just everyone because then it will discourage small businesses from going after big businesses; seems like it is hard to set one law and expect it to do everything right and nothing wrong.
ReplyDeleteI think the comparison to asymmetric warfare is an interesting one. The term had traditionally been used to refer to warfare in which one side, having substantially less resources than the other, focuses their strategy on the depletion of the larger organizations' resources, rather than winning outright. Notable historical examples include the American Revolution and the Vietnam War.
ReplyDeletePatent trolls are clearly a parallel example, given their lack of resources and ability to be countersued compared to the large tech companies that they are suing. In my opinion, the only way that large technology companies can aim to fight off these trolls is by participating in unilateral efforts to reform the patent litigation system, rather than fighting off trolls one by one.