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Patent “Trolls” Behind a Fifth of US Patent Lawsuits

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According to recently released figures, a fifth of patent infringement actions in the US is brought by someone not using the patented invention themselves.

So called “non-practicing entities” were responsible for about 20 per cent of US patent infringement cases between 2007 and 2011, according to a new report by the US Government Accountability Office (GAO).

The nick-name “patent troll” was created to refer to such litigants, who deliberately acquire patents relating to useful technology just so they can squeeze money out of those who use such technology. Many regard patent trolls as a menace because they way they use the patent system may prevent technology reaching the public, which is the opposite to its purpose.

That so much litigation in the US is brought by non-practicing entities is a shame, as it frustrates the purpose of the patent system, which is to reward innovation, and therefore help to bring new technology to the public. However, if an invention is good enough to merit a patent then the owner has the right to prevent others using it, and that is fundamental to the system.

Also, although the GAO report does not specify the numbers, some of these non-practicing entities may not simply have acquired patents in order to sue for profit. Some may be universities or research institutes which seek to licence their patents rather than exploit them themselves.

The GAO blamed the lack of clarity of some US patents, and the massive pay-outs sometimes awarded by US courts as the reason why patent trolls act in the way they do. As many BWR clients will know from bitter experience, the US patent office is certainly responsible for granted some appalling patents.

The GAO report actually says: “Several stakeholders GAO interviewed said that many such lawsuits are related to the prevalence of patents with unclear property rights; for example, several of these stakeholders noted that software-related patents often had overly broad or unclear claims or both.” It then goes on to say that the US patent office should do something about this. At BWR we are not holding our breath!

If you need to discuss a case of patent infringement, our Patent Attorneys will talk through the process with you providing clear and precise information on what the next steps involve. Visit the Patent Attorneys page for more information or call 020 8600 6800.

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