patent troll

The pace of patent litigation has fallen for the first time in five years, which can be directly traced to the U.S. Supreme Court's ruling last year about software patents in Alice Corp. v. CLS Bank, The Washington Post's Brian Fung reports. That case raised the bar for patentability and enforcement of software patents.

Bloomberg's Susan Decker had an interesting piece this week: firms that aggressively pursue patent litigation have found their business model to be less lucrative after the U.S. Supreme Court limited what types of software are eligible for legal protection and after the Patent and Trademark Office changed how it reviews patent disputes. Total patent lawsuits declined 23 percent in the third quarter of the year, Bloomberg reports. Adam Mossoff, a law professor at George Mason University said the changes show that Congress doesn't need to take up patent reform in 2015.

Jeff John Roberts, writing in Gigaom, reports on data that shows that patent trolls, less frequently called "non-practicing entities," have gotten three times the damages in court than "real companies." The reasons for the higher damages awards for patent trolls? Lawyer Michael Strapp told Roberts that includes the "the economic model of patent trolling, which in many cases entails the troll building up a legal war chest by squeezing settlements from dozens of smaller companies, and then suing a big fish." Another reason is suing in favorable venues like East Texas and Delaware.

The Gigaom piece has some great charts, so I highly recommend checking it out.

Gigaom reports on the adverse affects the Federal Circuit is having on patent law: "There are many explanations for the sorry state of the U.S. patent system, but one that comes up on a regular basis is the U.S. Court of Appeals for the Federal Circuit. The pro-patent proclivity of the court, which hears every patent appeal in the land, has given it a 'rogue' reputation and forced the Supreme Court to reverse its decisions again and again. This week, the Supremes did so once more."

The issue, SCOTUSblog reports, is who "bears the burden of persuasion when a user of technology files suit against a patent-holder, seeking a declaratory judgment that its actions do not infringe a particular patent." Under the Supreme Court's ruling, the burden of proof rests with the patent-holder, not with the alleged infringer seeking the declaratory judgment.

The ruling should help tech firms and inventors keep one step ahead of patent trolls wielding their intellectual-property troves as revenue-generating swords through patent-infringement lawsuits.

Reuters reports on the concerns raised as the U.S. Senate consider legislation to curb patent trolls. Sen. Richard Blumenthal, Democrat of Connecticut, said he is "wary of unintended consequences," while bill sponsor Sen. Patrick Leahy said the legislation balances the rights of patent holders against patent trolls who buy up patents just to pursue litigation. Among other measures, the legislation would require losers in patent litigation to pay the winner's fees if a judge decides the litigation never should have been brought.

The Hosue of Representatives passed bipartisan legislation to curb so-called patent trolls, The Legal Times' blog reports. The legislation, if enacted, would change intellectual property law "with provisions to strengthen pleading requirements, require the litigation's loser to pay for high-cost patent fights and create new rules about discovery," BLT further reports.

The Senate is expected to make its own changes to patent legislation, BLT also reports.

Patent trolls have become an increasing issue in recent years in which business entitites buy larges troves of patents and then assert them to make money by threatening lawsuits.

If you want a fascinating primer on the issue of patent trolls, then listen to the episode This American Life program did about patent trolls.

With new patent reform legislation introduced in the House of Representatives, Corporate Counsel asks if patent reform should be left to the judiciary, not Congress. But the judiciary may be moving faster anyway: "Most of the key features of the anti-patent troll bill introduced by House Judiciary Committee Chairman Bob Goodlatte, dubbed the 'Innovation Act of 2013', could actually end up duplicating moves made by the judiciary, including two decisions by the U.S. Supreme Court and changes to the Federal Rules of Civil Procedure," according to Corporate Counsel. Goodlatte's bill would allow for shifting reasonable attorney fees from defendants to patent trolls whose "principal business model is to assert patents as their main source of revenue," but the U.S. Supreme Court has agreed to take up two cases involving patent-case fee-shifting, Corporate Consel also reported.

The Electronic Frontier Foundation has filed a challenge to a "patent troll" who says it invented podcasting, GigaOm reports. According to EFF's petition for inter partes review, patent owner Personal Audio says it invented podcasting in 1996, but EFF says "distributing episodes of media content on the Internet--had been known for at least three years at that point." Read the full petition here: https://www.eff.org/document/podcasting-petition-inter-partes-review