New Laws Needed to Curb Patent Trolls

Did you know that last year alone there were 247,713 patent applications in the United States? The first Patent Act of the U.S. Congress was passed on April 10, 1790, titled “An Act to promote the progress of useful Arts”. But at what point do Patents stop promoting “useful arts”? The recent Samsung vs. Apple Patent lawsuits has brought forward some funny and ridiculous patents. Things like “rounded corners” on smartphone devices and finger gestures to switch between screens. Silly patents aren’t the only thing that is inhibiting discovery and innovation, patent trolls are too.

According to Wikipedia, a Patent Troll is someone that:

-Purchases a patent, often from a bankrupt firm, and then sues another company by claiming that one of its products infringes on the purchased patent;

-Enforces patents against purported infringers without itself intending to manufacture the patented product or supply the patented service;

-Enforces patents but has no manufacturing or research base;

-Focuses its efforts solely on enforcing patent rights; or

-Asserts patent infringement claims against non-copiers or against a large industry that is composed of non-copiers.

Gigaom recently released an article about Patent Trolls. It disclosed that Twitter because it is a large and profitable company, is often the target of patent trolls. These frivolous lawsuits typically take months, sometimes years to fight and hundreds of thousands of dollars. The troll isn’t even held responsible for these costs if the lawsuit is found to have been filed without merit.

A recent study at Boston University estimated that in 2011 alone, these baseless patent troll lawsuits cost U.S. technology companies more than 29 billion dollars.

Twitter and other companies that fall victim to these trolls are often forced to employ large teams of lawyers and employees focused solely on researching and fighting the lawsuits. If a patent troll were to attack a small company or startup, this could easily close their doors forever, further inhibiting innovation and discovery, all of which our country (and the world) were built on.

There is something that needs to be done to stop these baseless lawsuits from scaring individuals and companies into doing amazing new things. A new bill was announced in Congress last month by Representative Peter DeFazio (D-Oregon), the Saving High-tech Innovators from Egregious Legal Disputes (SHIELD) Act [PDF], would force these patent trolls to pay for all fees related to the frivolous lawsuits if it is found to have no merit, thereby hopefully curbing some of these lawsuits from ever being filed.

What are your thoughts or comments on patent trolls? Please share your comments below.

Also, be sure to share this if you enjoyed it and do not feed the trolls.

  1. james g

    The SHIELD act looks like it mostly talks of computer hardware and software infringement .This should be applied to all who hold patents or have frivolous lawsuits ( like the McDonald’s one) but to make it that “loser pays” on this would keep it down but we must also protect the individual innovator from large corporations with deep pockets .Like the inventor of the 100 MPG carburetor bought up by an oil company only to shelf it and say it doesn’t work , could he sue the company for slander or for hogging the market to only sell more fuel ?

  2. james g

    …..In addition Like Tesla motors who has a great product but now is fighting and defending its retailing strategy against lawsuits by state auto dealer groups ? Sounds like pressure from the big 3 and/or the oil companies , etc .

  3. Al Wright

    I totally agree with the sentiment of this article. Its about time someone took action to curb this. I think these companies should be forced to prove that they are legitimate and have every intention of building upon a patent that was acquired from another source. We have given up too much to other countries and these Trolls inhibit creativity and entrepreneurship.

  4. Ian P

    My company has faced a form of trolling activity over the past 10 years. It indeed is a festering sore and a significant and costly distraction for a highly innovative company in a niche market.

    The point I would make is that the practice of frivolous lawsuits of any kind is a factor of being under the American system of justice whereby the loser only has to pay his own costs. A change in this legal approach more toward the English system would have a big impact on many aspects of business and personal life too by taking away the incentive to make frivolous and vexatious claims against any party.

  5. Tony

    Yes it’s very true that one can sue someone just to make some money without thinking of the progress of the country.

    And on the other hand make China prosper by not following any rules or Laws.

    They copy these products and sell it back to us, make millions and these trolls or corporations control the supply chain and the price to make more money.

    The product I sell is patented in this country but the manufacturer does not or can not produce the quality customer will prefer.

    So they like my product that is not only cheaper to manufacture outside of the country but better quality.

    It’s pure greed.

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