Two researchers at the famed London School of Economics & Political Science, Christian Helmers and Luke McDonagh, have released a thought-provoking study of “Patent Assertion Entity” litigation in the UK. From the summary here are the two key findings:
“Firstly, the majority of patent cases which reach a judgment in the UK result in a ruling invalidating the patent. Secondly, the costs regime in the legal system of England and Wales requires that the losing party pay the costs of the other side. In other words, even if its own costs are kept low, a PAE which loses a case may have to spend a substantial amount of money in order to cover the costs of the other side.”
So, will this study increase the snowball rolling downhill to introduce a “loser pays” policy for NPE’s in the US?
This study has other intriguing elements to it as well:
“We also offer interesting insights to the wider debate concerning whether it is likely that in the near future there will be a similar increase in PAE litigation in Europe as has already occurred in the US over the last decade. This article also discusses potential implications for the design of the proposed European Unified Patent Court.”
To read the entire study (and you should) please go to this link: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2154958
Last Thursday, Nathan Myhrvold was the keynote speaker at the second annual Social Innovation Fast Pitch (SIFP) at Seattle Center’s Fisher Pavilion. During his lecture, er, speech, he reportedly said:
“The tech industry – which I love, I’m a part of and am totally guilty of this – is about making tools and toys for rich people. … And frankly, everyone in the United States is rich compared to the world.”
Everyone? Has Nathan been to the mountains of Appalachia? The ghetto’s of Detroit? The shacks in the Central Valley of California that immigrants live in? Ludicrous.
Myhrvold encouraged inventor to “invent miracles” that will change people’s lives:
“It’s great you can kill aliens with Xbox at a faster rate than ever before, but we didn’t really need our lives changed,” he said. “The fact is, there are people that do need their lives changed.”
A noble thought indeed. But, it does seem to raise a question: Why isn’t he doing this?
Anyway, see this link for more about the speech: http://www.geekwire.com/2012/nathan-myhrvold-completely-fine-failure-thinks/
In an angry post on infoworld.com Simon Phipps eviscerates NPE’s, the patent system, and the NPE toll on innovation. Here is a tiny sample of his rant (with bolding added):
“The cost of litigation for patent parasites must go up; there need to be penalties for failed attempts to monetize the innovation of others. Most important, the mafiosi-grade shakedowns costing America’s economy so much money — and with it the success of innovative startups and the creation of much-needed jobs — has to end.”
Patent parasites? Shakedowns (hmmm second use today)? The inflammatory language campaign against NPE’s continues.
For the entire diatribe, please go to this link: http://www.infoworld.com/d/open-source-software/numbers-dont-lie-patent-trolls-are-plague-205192?page=0,1
Distinguished Judge Richard Posner has written a short article on Slate.com regarding patents and Patent Trolls, and it is clear that he is not happy with the current patent system and Patent Troll litigation.
He offers 3 key remedies:
1. “….make the granting of a patent contingent on producing the product or process that incorporated the invention, within a specified time. This would reduce the troll problem, by clearing out patents that are obtained to extort license fees rather than to produce products or processes.”
2. ” Vary the length of patent protection…from industry (or industrial sector) to industry, ranging from no protection at all to 20 years of protection, or even more, for pharmaceutical drugs.”
3. Seek and train “…volunteers among federal district judges to take on more than their share of the patent cases filed in their districts.”
But Posner admits that these remedies are not a complete answer to the Patent Troll problem.
What do you think?
Here is a link to the complete article which is well worth a read: http://www.slate.com/articles/news_and_politics/view_from_chicago/2012/10/patent_protection_how_to_fix_it.html
In a paper just published researchers Robin Feldman, Sara Jeruss, and Joshua Walker report on patent monetization entities (oh no another name for patent trolls!) and their effects on litigation. Their summary states:
“The data confirm in a dramatic fashion what many scholars and commentators have suspected: patent monetization entities play a role in a substantial portion of the lawsuits filed today. Based on our sample, lawsuits filed by patent monetizers have increased from 22% of the cases filed five years ago to almost 40% of the cases filed in the most recent year. In addition, of the five parties in the sample who filed the greatest number of lawsuits during the period studied, four were monetizers and only one was an operating company.
Of additional note, universities, which are sometimes grouped with non-practicing entities on the theory that they do not make products, were almost invisible and accounted for only 0.2% of the cases in our sample. Finally, Patent monetizers were unlikely to advance very far in the trial process, generally settling prior to a summary judgment decision. Our article details these and other results of the study.”
BTW, Who are the “Fab Five”? Jens Erik Sorensen, Arrivalstar, Acacia and Guardian Media Technologies (all NPE’s) and Abbott Labs (an operating company). Who knew Abbott was so litigious?
To read the paper which has so much more to offer, go to this link: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2158455