Trolls Behind 61% Of All U.S. Patent Lawsuits

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I want to say this is surprising but, being totally honest, I don't think this really comes as a surprise to anyone. :(

These companies, more commonly known as patent trolls, have accounted for 61% of all patent lawsuits filed through December 1st, compared to 45% in 2011 and 23% in 2007. Professor Colleen Chien revealed that “more suits are being brought by entities that don’t make anything than those that do,” adding that more than ever lawsuits are being filed against startups.
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There are differences between companies that do not actually make a product that own and license patents.

There are the ones that spend money on research, patent the thing they came up with as a result of that research, and then attempt to license the product to others. These are legit companies to me, with a legit business model, even though they do not actually make a product.

Then there are the ones I really consider trolls. The patent warehouses. Companies that buy all manner of patents, many of them of the Appleesque "rectangle with round corners" variety, and do nothing with them except wait for someone to make something that possibly infringes on the patent they purchased. Then waits some more until that company has succeeded in making a bit of money of the product. And then, finally swoops in with their hand out threatening legal action if they don't get a cut. Or just straight skips ahead to filing the lawsuit.


That these lowlifes are clogging our courts with often merit less patent suits is not surprising
 
Increasing liability for startups. The fastest way to stunt job creation.
 
I honestly thought it would have been higher, like 75% trolls, 25% apple/google/microsoft related.
 
Patents need to go back to requiring a physical functional prototype as a primary necessity to secure a patent and not just a nebulous drawing that could show a thousand different things without specifically saying what is part of the scope of the patent.
 
GORANKAR said:
There are differences between companies that do not actually make a product that own and license patents.

There are the ones that spend money on research, patent the thing they came up with as a result of that research, and then attempt to license the product to others. These are legit companies to me, with a legit business model, even though they do not actually make a product.

Then there are the ones I really consider trolls. The patent warehouses. Companies that buy all manner of patents, many of them of the Appleesque "rectangle with round corners" variety, and do nothing with them except wait for someone to make something that possibly infringes on the patent they purchased. Then waits some more until that company has succeeded in making a bit of money of the product. And then, finally swoops in with their hand out threatening legal action if they don't get a cut. Or just straight skips ahead to filing the lawsuit.


That these lowlifes are clogging our courts with often merit less patent suits is not surprising
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If all companies who patented something but make nothing (fabless) are bad (they're not) then NVIDIA should be the next target. I agree that "companies who don't make anything" is a bad distinction.

Perhaps if we removed the incentive (ability to patent really freakin' vague things) it might cause the trolls to go back under their bridges.
 
This all comes down to how broken the US patent system is in its current state. Companies that license (ie. Nvidia in someone elses comment) typically develop a prototype. Usually licensing is done because the entity doesn't have the capabilities to produce said product on a large scale.

Just cause you scribbled down something on a bar napkin doesn't make it feasible, and shouldn't grant rights to a patent.
 
Those patent trolls spend a lot of money lobbying politicians, to prevent patent reform.
 
yay another story showing how patent reform is desperately needed.

At the very least laws that drastically change the protection rights given to patents when the patent ownership changes hands. If you invent something its your right to sit on it until the patent is up and sue the hell out of anyone who tries to use it, if you buy a patent you should be given a grace period of 2 years to have said patent used by your company in some fashion or the patent will expire.

And for the love of god CODE should not be something you can patent and life in any way shape or form should not be something you can patent.
 
I say just shrink patent lengths. 5 years. After that, everyone can use it. The same way that drug patents have a 20 year life, at which point. Generic crap can come out.
 
...and you wonder why your country is going downhill.

Seriously, going after startups is brutal. It's like they want to kill businesses for the sake of it.
 
cdr_74_premium said:
...and you wonder why your country is going downhill.

Seriously, going after startups is brutal. It's like they want to kill businesses for the sake of it.
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The whole point of a patent is to prevent competition. Startups provide competition, so established companies will simply use patents to kill them off. For some reason, this is considered a "good patent".
 
LeninGHOLA said:
First to file, go go go!
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Not going to change anything. Companies will still get patents, decide to sell them, and trolls will buy them up. First to file just means that the selling entity is less likely to be an average Joe that lacks the $$$ and know-how to get a patent app filed on time.

GORANKAR said:
Then there are the ones I really consider trolls. The patent warehouses. Companies that buy all manner of patents, many of them of the Appleesque "rectangle with round corners" variety, and do nothing with them except wait for someone to make something that possibly infringes on the patent they purchased. Then waits some more until that company has succeeded in making a bit of money of the product. And then, finally swoops in with their hand out threatening legal action if they don't get a cut. Or just straight skips ahead to filing the lawsuit.
That these lowlifes are clogging our courts with often merit less patent suits is not surprising
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See, this is a problem of misconception. I wouldn't blame the trolls. See, you identify two issues: Trolls and bad patents.
If the patent is bad, then that's one thing, and you should blame the USPTO for granting a bad patent. Furthermore, the courts are exactly where these patents SHOULD be so they can be invalidated. The introduction of pst-grant-review processes in the AIA has also added an inexpensive avenue for challenging the validity of a patent after it is granted.

The second issue you recognize is trolls. I, again, don't blame them. If the patent is good (and for the sake of argument let's say it is, since if it is not, see my last comment), then it SHOULD be enforced to drive innovation, and prevent the copying of a patented product. preventing this copying forces the related industry players, startups and existing companies alike, to innovate around what has already been discovered, creating new innovation. This is a good thing, and it can be argued that patent trolls are simply enforcing the patents that the USPTO granted, and therefore enforcing the purpose of those patents in the first place... particularly when the patentee in financially incapable of enforcing his or her patent.
Nanan said:
Patents need to go back to requiring a physical functional prototype as a primary necessity to secure a patent and not just a nebulous drawing that could show a thousand different things without specifically saying what is part of the scope of the patent.
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That's physically, intellectually and financially impossible. For example, say I patent a new chemical for a new anti-cancer drug. What is the patent office going to do with a jar of that stuff? Nothing. It's the FDA's job to oversee the testing and validation of a drug, not the USPTO. Same with, say, a new car transmission. What is the USPTO going to do with that? Where will they store the thousands of car transmission patents that come in every year? Or boat hulls, or insulation types? What about process patents where you are not patenting a THING, but a PROCESS to make something? How do you submit a sample of that? There's a reason the USPTO quickly stopped requiring such samples, it doesn't do anyone any good.

Keep in mind, though, it's no longer mandatory, but the USPTO can request it. And they do when appropriate.

sfsuphysics said:
yay another story showing how patent reform is desperately needed.
At the very least laws that drastically change the protection rights given to patents when the patent ownership changes hands. If you invent something its your right to sit on it until the patent is up and sue the hell out of anyone who tries to use it, if you buy a patent you should be given a grace period of 2 years to have said patent used by your company in some fashion or the patent will expire.

And for the love of god CODE should not be something you can patent and life in any way shape or form should not be something you can patent.
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A better option, and one used by Europe is compulsory licensing. If you don't USE your patented invention within a certain period of time, anyone can come to you and request a license to use it, at FRAND rates.

At the same time, I believe that a company SHOULD be able top sit on a technology they don't want others to have. Say you develop two revolutionary widgets. One is the best, the second is clearly the second best option. Currently you competitors use a distant third best. You should be able to use #1, and sit on #2 and use it as a defensive weapon to keep your competitors back. This also, which is the PURPOSE of patents, forces your competitors to pour money into R&D to come up with a 4th option to compete: i.e. innovate.

cdr_74_premium said:
...and you wonder why your country is going downhill.
Seriously, going after startups is brutal. It's like they want to kill businesses for the sake of it.
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It's not brutal if those startups are copying your IP. Startups aren't good people just because they are startups.
Wumpus said:
The whole point of a patent is to prevent competition. Startups provide competition, so established companies will simply use patents to kill them off. For some reason, this is considered a "good patent".
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WRONG. SO WRONG. The point of patents is innovation. Competition is completely irrelevant to the granting and enforcement of a patent.


Look, folks. The point of the patent system is to generate more technology, more innovation. NOT more companies or startups or jobs or businesses or even money. The point is to put roadblocks up to prevent simple copying so that innovation must occur.
 
Modred189...you're dead wrong. The patent system as it stands completely stifles innovation and competition. Instead of companies being able to invest in R&D they need to invest in lawyers. There's no way any company should be able to sit on any invention, that is, patent it, but don't sell or license something involving said patent. If you don't actively use it, you should loose it.
 
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freeloader1969 said:
The patent system as it stands completely stifles innovation and competition. Instead of companies being able to invest in R&D they need to invest in lawyers. There's no way any company should be able to sit on any invention, that is, patent it, but don't sell or license something involving said patent. If you don't actively use it, you should loose it.
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First, WHY? Why shouldn't they be able to utilize their property as they see fit? Even if that means DOING NOTHING with it? What if they patent something before it CAN be used, because new technology, undeveloped, is required to use it? (happens quite often, actually)

Second, what makes you think it stifles innovation? Legal budgets and R&D budgets are not a zero sum game, particularly because the lawyer-costs come after successful R&D efforts, not before: after creating something, you have to check to see if its been done before (freedom to use opinions are cheap and easy to come by if valid), and if not, then you pay to get it patented. You only have to pay an attorney for litigation expenses if you copied someone else's tech (that you should have ID'd earlier) or if someone copied yours.

Patents provide a legal method by which copying, the opposite of innovation, can be prevented. If you don't stop copying, you stifle innovation.
 
Modred189 said:
First, WHY? Why shouldn't they be able to utilize their property as they see fit? Even if that means DOING NOTHING with it? What if they patent something before it CAN be used, because new technology, undeveloped, is required to use it? (happens quite often, actually)

Second, what makes you think it stifles innovation? Legal budgets and R&D budgets are not a zero sum game, particularly because the lawyer-costs come after successful R&D efforts, not before: after creating something, you have to check to see if its been done before (freedom to use opinions are cheap and easy to come by if valid), and if not, then you pay to get it patented. You only have to pay an attorney for litigation expenses if you copied someone else's tech (that you should have ID'd earlier) or if someone copied yours.

Patents provide a legal method by which copying, the opposite of innovation, can be prevented. If you don't stop copying, you stifle innovation.
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If you can't produce on a patent, then license it to someone who can.
 
LeninGHOLA said:
If you can't produce on a patent, then license it to someone who can.
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WHY? That's the opposite of innovation, the purpose of the patent system.
Say there is a problem, P. I create a solution to Problem P, S and patent it. I have three options:
1- Use S, market my resulting product etc, put competitors at a disadvantage, make money.
2- License S to others, make money
3- Sit on S, putting competitors at a disadvantage. Make more money, relatively, than competitors.

I cases 1 and 3, my competitors are at a disadvantage. TO compete, they pour money into R&D, creating solutions S1 and S2. S1 and S2 may be better or worse than my S, but guess what? Because of their disadvantage, there are now THREE solutions on the market, S, S1 and S2, where under scenario 2, there is only one.

Thus, innovation.
 
Modred189 said:
WHY? That's the opposite of innovation, the purpose of the patent system.
Say there is a problem, P. I create a solution to Problem P, S and patent it. I have three options:
1- Use S, market my resulting product etc, put competitors at a disadvantage, make money.
2- License S to others, make money
3- Sit on S, putting competitors at a disadvantage. Make more money, relatively, than competitors.

I cases 1 and 3, my competitors are at a disadvantage. TO compete, they pour money into R&D, creating solutions S1 and S2. S1 and S2 may be better or worse than my S, but guess what? Because of their disadvantage, there are now THREE solutions on the market, S, S1 and S2, where under scenario 2, there is only one.

Thus, innovation.
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Getting products to market is less innovative than sitting on them, then suing?
 
LeninGHOLA said:
Getting products to market is less innovative than sitting on them, then suing?
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Actually, yes and no (if you read my post again, i say going to market and sitting on it are equivalent). Innovation = more technology, not more products. This is an important differentiation.
Thus, the more roadblocks you set up to copying, and the more incentive you introduce to create new things, the more new technologies that will be created. Sure, that may mean that small companies are out-competed, but, there's a reason that the word 'competition' isn't mentioned much in patent law.

What I can say is that going to market and sitting and suing are more innovative than licensing.
 
Driving innovation by sitting on patents instead of licensing them is one thing. Translating a patent and theoretical research into practical technology that improves quality of life is quite another. Get your priorities straight, modred.

Do you really think using a patent as a weapon is better for technological progress than licensing that patent to someone who can turn it into usable technology? When you license a patent you have no intention of using, everybody wins.
 
wabbitseason said:
Driving innovation by sitting on patents instead of licensing them is one thing. Translating a patent and theoretical research into practical technology that improves quality of life is quite another. Get your priorities straight, modred.

Do you really think using a patent as a weapon is better for technological progress than licensing that patent to someone who can turn it into usable technology? When you license a patent you have no intention of using, everybody wins.
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I agree with you, in principle, but that's not what the patent system is for. It's not for competition, or product development, or making US consumer happy. It's about creating MORE technologies. So, if you look at it from that narrow, specific purpose (which is how the law, statutory and common, is written), then using a patent as a weapon is THE SAME as using it to create a marketed product, both of which are better than licensing, because the first two generate innovation and licensing does not.
 
After all, the US Consitution says:
Congress shall have the power ... To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;
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Note, that no one but the creator and innovation is mentioned. No one else. All patent and copyright law that depends from Article Section 8 Clause 8 is the same. It's about innovation, not marketing or businesses etc.
 
Modred189 said:
First, WHY? Why shouldn't they be able to utilize their property as they see fit? Even if that means DOING NOTHING with it? What if they patent something before it CAN be used, because new technology, undeveloped, is required to use it? (happens quite often, actually)

Second, what makes you think it stifles innovation? Legal budgets and R&D budgets are not a zero sum game, particularly because the lawyer-costs come after successful R&D efforts, not before: after creating something, you have to check to see if its been done before (freedom to use opinions are cheap and easy to come by if valid), and if not, then you pay to get it patented. You only have to pay an attorney for litigation expenses if you copied someone else's tech (that you should have ID'd earlier) or if someone copied yours.

Patents provide a legal method by which copying, the opposite of innovation, can be prevented. If you don't stop copying, you stifle innovation.
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I'm not going to argue about it with you. It's clear that we will have to agree to disagree about it. As I see it, the patent system as it stands today is fundamentally broken and full of corruption. The mere thought of gene patents and software patents makes me sick to my stomach.
 
freeloader1969 said:
I'm not going to argue about it with you. It's clear that we will have to agree to disagree about it. As I see it, the patent system as it stands today is fundamentally broken and full of corruption. The mere thought of gene patents and software patents makes me sick to my stomach.
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We are in complete agreement in regards to gene patents, though maybe for different reasons (I think they violate a founding principle of patent law: you cannot patent products of nature).

That said, I am honestly curious, how would you fix it? Compulsory licensing, lie the EU? (I think that is an excellent solution for software patents)
 
GORANKAR said:
Then there are the ones I really consider trolls. The patent warehouses. Companies that buy all manner of patents, many of them of the Appleesque "rectangle with round corners" variety, and do nothing with them except wait for someone to make something that possibly infringes on the patent they purchased. Then waits some more until that company has succeeded in making a bit of money of the product. And then, finally swoops in with their hand out threatening legal action if they don't get a cut. Or just straight skips ahead to filing the lawsuit.


That these lowlifes are clogging our courts with often merit less patent suits is not surprising
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I agree. There are those that can patent ideas and whatnot without the means to bring them to a finished product and sell the idea to a manufacturer. I have no problem with that. I can design something, patent it, yet not have the means to actually create the product on a mass scale. I would go shopping for a company that did have the resources to do so and license or sell the patent and technology to them.

But, I like your definition of the real trolls. They profit in buying and litigating patents. That's it. They have no intentions of utilizing the patent other than for litigation.
 
Modred189 said:
WRONG. SO WRONG. The point of patents is innovation. Competition is completely irrelevant to the granting and enforcement of a patent.
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What part of "exclusive right" did you miss? All a patent can do is prevent competition. You see a competitor using something that you can somehow claim infringes a patent (and buy said patent if necessary) and sue them till they stop competing or cough up the protection money (which is often your choice).

As long as the patent system exists, it will be used to prevent competition.
 
Modred189 said:
Patents provide a legal method by which copying, the opposite of innovation, can be prevented. If you don't stop copying, you stifle innovation.
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Not true at all.

All innovations come from building ontop of other innovations:

Person 1 a invents a stone wheel.
Person 2 copies the wheel but makes it out of wood instead of stone.
Person 3 steals this idea and makes it out of metal.
Person 4 copies the wheel but adds a rubber outside.
Person 5 copies the rubber idea but makes in inflatable.
Person 6 copies the inflatable rubber outside but then adds a wire mesh so it keeps running when it's punctured.

Under the 20 years of stifling, each of these steps has a long pause before the next one is allowed to happen. It artificially slows innovation. the company, having the "best" wheel can just sit there stopping others from improving or innovating on it's design. As it has the only version of a product there isn't much reason for it to actively try to improve on it, as theres no competing wheels you have to outdo.

Look at history and technology moves forward the fastest during times of intense competition. Being allowed to patent stupid concepts and overly broad stuff stops all of this and stifles innovation.
 
Wumpus said:
What part of "exclusive right" did you miss? All a patent can do is prevent competition. You see a competitor using something that you can somehow claim infringes a patent (and buy said patent if necessary) and sue them till they stop competing or cough up the protection money (which is often your choice).

As long as the patent system exists, it will be used to prevent competition.
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All of this is correct, and has nothing to do with the purpose of the patent system. The patent system doesn't care for competition. It's irrelevant. Patents are a system to boost net innovation. Nothing more, nothing less.

DeathPrincess said:
Not true at all.

All innovations come from building ontop of other innovations:

Person 1 a invents a stone wheel.
Person 2 copies the wheel but makes it out of wood instead of stone.
Person 3 steals this idea and makes it out of metal.
Person 4 copies the wheel but adds a rubber outside.
Person 5 copies the rubber idea but makes in inflatable.
Person 6 copies the inflatable rubber outside but then adds a wire mesh so it keeps running when it's punctured.

Under the 20 years of stifling, each of these steps has a long pause before the next one is allowed to happen. It artificially slows innovation. the company, having the "best" wheel can just sit there stopping others from improving or innovating on it's design. As it has the only version of a product there isn't much reason for it to actively try to improve on it, as theres no competing wheels you have to outdo.

Look at history and technology moves forward the fastest during times of intense competition. Being allowed to patent stupid concepts and overly broad stuff stops all of this and stifles innovation.
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You don't understand patents. In each of your examples, each successive new wheel would be patentable because it include limitations/narrowing characteristics that the previous one didn't. Now, we could argue about the doctrine of equivalents but that would go past the point of your analogy.
 
Modred189 said:
You don't understand patents. In each of your examples, each successive new wheel would be patentable because it include limitations/narrowing characteristics that the previous one didn't. Now, we could argue about the doctrine of equivalents but that would go past the point of your analogy.
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It is you who apparently doesn't understand how the lawyered up modern patents system works. Person 2 onwards would all be sued for having a product which was round.
 
Modred189 said:
...
WRONG. SO WRONG. The point of patents is innovation. Competition is completely irrelevant to the granting and enforcement of a patent.


Look, folks. The point of the patent system is to generate more technology, more innovation. NOT more companies or startups or jobs or businesses or even money. The point is to put roadblocks up to prevent simple copying so that innovation must occur.
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Thank you Sir. I make a living in this business and I'm tired of explaining this to people.
 
DeathPrincess said:
It is you who apparently doesn't understand how the lawyered up modern patents system works. Person 2 onwards would all be sued for having a product which was round.
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And how would they get sued for something they have a patent on, pray tell? Seems like they have a pretty solid defense when the US GOVERNMENT said they had a clear shot at it.
And I might know better than you think...

reb00tin said:
Thank you Sir. I make a living in this business and I'm tired of explaining this to people.
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Makes two of us, lol.
 
DeathPrincess said:
So in your professional career you've never heard of a patent being invalidated for prior art? :p
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Haha, short as it has been so far, I know what you're saying, but again, we're going deeper than necessary here. The point still stands that there are standards for granting a patent enshrined in the MPEP, CFR 37, and the US code. The vast majority of patents are correctly granted (or denied). WE can't play the fringes here.

That said, under your examples, there would be valid patents available ot each and every inventor along the way, and no basis for infringement. Furthermore, an inventor further down the chain would have, or should have, done research to see what had been patented before he went out selling his 'new' wheel. If he didn't do such a search, or made the wheel despite the location of a patent that would have been infringed, that's his fault and the gamble he took by ignoring the law. All he had to do was INNOVATE around the previous patents and he would have been fine.

So don't blame the patent system for a infringer's failure to make a good, educated decision when he decided to produce and infringing product.
 
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