At War With Patent Trolls

Most technology lawsuits come from companies existing solely to sue for patent infringement, and this trolling is becoming a problem for genuine creators.
A whopping 90% of US lawsuits over technology patents are filed by patent trolls, according to new statistics from United Patents. A patent troll is an entity that makes its money from buying patents so it can sue other companies for infringement, and they’re becoming a big problem. These lawsuits aren’t happening because companies are going after competitors for stealing their ideas – the original purpose of patent laws.
In the innovation-driven world of technology, the rise of patent trolls is an issue that’s starting to hamper technological advancement. A patent exists to protect an inventor from others stealing his or her idea, the objective being that the protection awarded by a patent creates incentive for people to push on research and development: you know the resulting product is yours.
Unfortunately a patent troll doesn’t create anything innovative. This is a company making money solely by threatening other businesses with lawsuits and collecting settlements. Lawsuits from patent trolls could reach an all-time high this year according to United Patents, an organisation working to help companies protect against patent trolls, (also known as non-practicing entities or NPEs). So far this year, 68% of US patent lawsuits have been filed by patent trolls, and on top of this, the total number of patent lawsuits is up by 38% in the first half, compared to the previous six months.
The number one target for patent trolls is Apple, which was sued 25 times by NPEs in the first half of this year. Amazon and HP are also popular targets. Apple, which is presumably targeted because the company has money, has previously argued that patent trolls are exploiting the law to cash in, despite adding nothing to the economy in the form of products, jobs or wealth creation. In June, US mobile operator Sprint lost a $30 million patent battle with Prism Technologies, which has also sued T-Mobile, Verizon and US Cellular. The patent in question deals with mobile security, specifically ways to “manage access to protected computer resources”.
Commenting on the case, patent litigation blogger Florian Muller told the BBC: “To be fair, Prism Technologies is better than most. It actually took its patents to trial and prevailed. But I have yet to see a patent in the IT industry that really warranted a 20-year monopoly for its holder.”.
One reason why patent trolls are able to sue companies like Apple over ideas the target may have legitimately invented in-house is that many early patents for technology are a bit vague. One example is how firewalls were officially patented in 2000, despite being invented in the 1980s. This is the sort of thing that arguably shouldn’t be patented in this broad sense as firewalls are so widespread, but patent trolls can use this to file a claim, and possibly get the defendant to pay to make it go away. Normally technology companies are reluctant to sue competitors, fearing retaliation, but NPEs don’t have to worry about this as they produce nothing.
Patent trolls have been ramping up their activities for many years now, to the point where the US Supreme Court ruled on a record six patent cases in the first half of last year. But in every instance, the Court ruled in favour of the alleged infringer. This has resulted in a call for a reform in US patent law which could see rules put in place to protect creators from nuisance lawsuits. Dealing with court action is time-consuming and expensive for businesses, so a change in patent law could be an important step for getting tech companies back to their core operations: developing new ideas. This is especially true for startups; Apple at least has the money to fight the trolls, but new companies bootstrapping a fresh idea risk being destroyed by this kind of opportunistic litigation.
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