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New USPTO Memo Makes Fighting Patent Trolls Even Harder

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Re: New USPTO Memo Makes Fighting Patent Trolls Even Harder

#51

Post by piker »

daemonologist wrote: post #49
whatshisface wrote: post #43

Earlier quoted context omitted.

How's this? 1. You buy "litigation insurance." 2. You state that you are insured on your website. 3. The insurance company is required to defend in all patent cases that arise, so there is no doubt that you will be represented in court. 4. Nobody sues. 5. The insurance company makes a profit with no cost or risk.

You can buy IP insurance; the problem is that the proposed strategy only works against patent trolls. If you infringed a legitimate patent the insurer would be screwed, so they'd want to do an enormous (impossible?) amount of due diligence before writing the policy. As with most other insurance policies, insurers in practice are only willing to take on a portion of the risk.

Adverse selection would be a big issue, but actually perhaps if the indemnity only covers defense, an insurer would be willing to take more risk (and have expertise in batting away these claims.)

Re: New USPTO Memo Makes Fighting Patent Trolls Even Harder

#53

Post by ted_dunning »

karaterobot wrote: post #39
gist wrote: post #32

Earlier quoted context omitted.

I think like so many things the idea of 'patent trolls' has taken on a meaning whereby anyone who has a patent but no operating actual company (as you are describing LLC with 5 members and a lawyer) everyone automatically thinks 'sham'. On the surface by stories related that certainly appears to be the case. However we don't have any data (only anecdotes) on how many patents are pursued this way that are actually val…

It's not really a question of whether the patent troll has a legitimate patent or not—in the sense of having clear ownership over the IP, that is. They generally do. We consider someone a patent troll when they don't make use of the patent themselves, except to extract money from other people, typically through threats of legal action. They're exploiting the fear of being sued for a lot of money in order to get a com…

Trolls often have clear title to a patent that covers something. Many of these patents should not have been granted, but they were. If you fight them to the end, you can often get the patent invalidated, but the trolls are smart enough to settle before that happens.

But they generally don't have a patent that covers anything real. Even ignoring the situations where the patent is indefensible through defects in process or due to prior art, the claims in these patents often don't actually read against the businesses being sued.

The problem is that it takes tens of thousands of dollars per patent to get an opinion from your own lawyers about whether the patents bear on your products or processes and you pretty much have to do that even if you never go to court.

Re: New USPTO Memo Makes Fighting Patent Trolls Even Harder

#54

Post by ted_dunning »

buckle8017 wrote: post #2

Maybe it's time for a patent pool for non-trolls covering patent to behavior.

Defensive patents don't really help against trolls since they don't actually make products. That means that they don't infringe on any patents and thus your defensive portfolio doesn't get to play.

Re: New USPTO Memo Makes Fighting Patent Trolls Even Harder

#55

Post by therein »

daemonologist wrote: post #49
whatshisface wrote: post #43

Earlier quoted context omitted.

How's this? 1. You buy "litigation insurance." 2. You state that you are insured on your website. 3. The insurance company is required to defend in all patent cases that arise, so there is no doubt that you will be represented in court. 4. Nobody sues. 5. The insurance company makes a profit with no cost or risk.

You can buy IP insurance; the problem is that the proposed strategy only works against patent trolls. If you infringed a legitimate patent the insurer would be screwed, so they'd want to do an enormous (impossible?) amount of due diligence before writing the policy. As with most other insurance policies, insurers in practice are only willing to take on a portion of the risk.

Couldn't some innovative insurance company create a policy that adds a clause like "policy kicks in if the litigant fits the criteria of a patent troll (as described above, lacking any assets besides the patent or a few patents that don't pass initial muster as legitimate, or has fewer than two physical locations with at least 4 non executive employees). Even saying something like "if the litigant has no health insurance for their employees" would actually easily preclude patent trolls as you'd have to be an actual decently sized company to be able to negotiate real health insurance for your employees.

Re: New USPTO Memo Makes Fighting Patent Trolls Even Harder

#56

Post by HeatrayEnjoyer »

ziddoap wrote: post #18
elevatedastalt wrote: post #15

Earlier quoted context omitted.

Doesn't it cost a lot in legal fee to the troll too? How are they able to finance it given that they are basically a sham company?

It's like spam. Send out 1,000s of dubious demand letters which don't cost much. Some percent of those will settle with minimal effort on the troll's side. Profit. Drop the ones that look expensive and hope they don't counter sue.

What would they counter sue for?

Re: New USPTO Memo Makes Fighting Patent Trolls Even Harder

#57

Post by daedrdev »

IPR is a tool that weakens all patents. Saying it helps trolls at the expense of everyone else (which this article says) is a bad faith argument. Weakening IPR helps all patent holders fight for their rights, including trolls. Considering how the tech industry has bullied its way past numerous rightful patents, this seems like it could be reasonable or might not be.

If you think we should have no patents be my guest, but this helps non troll patent holders and not just trolls.

Re: New USPTO Memo Makes Fighting Patent Trolls Even Harder

#58

Post by adgjlsfhk1 »

lofaszvanitt wrote: post #31
niwtsol wrote: post #14

We dealt with some patent trolls back in the 2010-2020 era, for those who have not experienced it, it is absurd. In our case, the patent "troll" was an LLC w/ ~5 members - 2 lawyers, 1 person who owned the original patent, and some spouses. The only "asset" of the LLC was the patent. I think it was around scrollbars or some CSS overflow thing - they sent us a demand/cease-desist letter saying they will sue for $1M an…

How come you can sue others and the court doesn't check whether you have the funds if you lose? I mean if you don't have funds allocated away in case you lose, then why start the proceedings?

Because it's generally considered bad policy to make it illegal for poor people to sue.

Re: New USPTO Memo Makes Fighting Patent Trolls Even Harder

#59

Post by dctoedt »

niwtsol wrote: post #14

We dealt with some patent trolls back in the 2010-2020 era, for those who have not experienced it, it is absurd. In our case, the patent "troll" was an LLC w/ ~5 members - 2 lawyers, 1 person who owned the original patent, and some spouses. The only "asset" of the LLC was the patent. I think it was around scrollbars or some CSS overflow thing - they sent us a demand/cease-desist letter saying they will sue for $1M an…

See Blue Jeans Cable's classic response to a patent cease-and-desist letter from Monster Cables: The Blue Jeans Cable CEO was a former litigator who pulled no punches in his response. [0]

[0] See https://www.oncontracts.com/monster-cables-picked-the-wrong-... (self-cite).

Re: New USPTO Memo Makes Fighting Patent Trolls Even Harder

#60

Post by ziddoap »

HeatrayEnjoyer wrote: post #56
ziddoap wrote: post #18

Earlier quoted context omitted.

It's like spam. Send out 1,000s of dubious demand letters which don't cost much. Some percent of those will settle with minimal effort on the troll's side. Profit. Drop the ones that look expensive and hope they don't counter sue.

What would they counter sue for?

I probably should have just written "counter" or "fight back". I was rushing out the office door when I pushed the reply button.

In some countries you can sue for "unjustifiable threats to begin patent infringement proceedings", but I was also thinking things like filing complaints with the relevant Bar associations. That sort of thing.

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