Patent Trolls: Conclusion & Opinion

Hello,

Since I had to make 6 blogs and 6 videos I figured that the last one should include a synopsis of what I learned in the past 5 from doing research on the subject of patent trolls and how they operate. In general, these trolls focus on buying up patents from innovators and either splitting profit or paying them off lump sum. Once they have the patent, they talk with the big name firms such as Google or Apple and try to get a licensing fee for the use of their patent. If these negotiations fail, the next step is to sue the firm outright. It can be difficult to win these cases for large tech firms because their patent has an earlier filing date and the technology they use sometimes clearly violates or infringes upon the patent. However, the legal bills from these cases can become astronomical as they move their way up the court system. Overall, 60 billion dollars annually are spent in concessions and legal costs which is money that could be better spent in research and development. Instead, many business strategies have been cut short because of a lack of profitability with a likely lawsuit hanging over their head. Though the White House and Congress have been discussing ways to change the legal system, people should be paid for their innovation, I think the main issue are the trolls grabbing at each patent likely to be infringed as they go. 

Patent Trolls: The notable ones

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Here I will go into some of the notable trolls of the industry and see how many patents they own and which companies they have under their belt licensing their patents for a charge. The first is Acacia Technologies which has 1,316 patents and dishes them out to the likes of Exxon, Microsoft, and Sony among other firms. Acacia believes that they are not stifling innovation but rather if someone owns the patent they should be paid. It is a valid argument but after a certain point, collecting patents seems a bit unlike the developer who made them demanding recourse. However, Acacia is good in that it splits the licencing revenue 50/50 with the patent owners and developers. Next we have Rambus, an infamous patent troll who was recently cited for destroying evidence in one of their trials. For the past decade, Rambus has made it their primary money making activity by trolling patents. Finally, we come to Round Rock Research LLC which is a notorious patent troll that owns 3,652 patents almost three times that of Acacia. RRR has built a reputation for being a troll and using troll like tactics to get these fees out of big name firms. Overall, this seems like a hindrance to innovation.

Patent Trolls: The Cost to Innovation

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This here will delve into the cost of patent trolls. Clearly, this has been a growing issue in the United States of America as the White House and Congressional leaders have gotten on board to address the issue of patent issues. Many believe that the entire system of patents need to be transformed. Others argue that it is not an actual harm to innovation but rather the number of patent trolls and NPE is actually a good sign that comes with good inventions and they cite the telegraph as something that was contested. Overall, the numbers do not look good. $60 billion dollars are spent annually on such lawsuits making the money essentially useless since it goes into NPE which reap profits and then reinvest to buy even patents in hope of a circular process. This 60 billion annually could go into more research and development but is instead relatively squandered on minuscule patent infringement. Research also shows that patent trolls are actually targeting the money in large R&D firms so it isn't equal for anyone but rather disproportionately focused on large tech firms. According to a survey conducted on tech firms, 41% said patent trolls made their firm change course or exit a business strategy because of lawsuit or otherwise. Overall, some changes should occur to increase the drive for innovation and R&D thriving. 

Patent Trolls: 10 Companies Embroiled in Lawsuits

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Here I am going to discuss the many different companies that are currently embroiled in lawsuits because I find it interesting that they are the ones being targeted. Last year, AT&T took the cake for most number of lawsuits against them by these NPE patent trolls. They were sued 54 times which is over once per week. The list is as follows: AT&T, Google, Verizon, Apple, Samsung, Amazon, Dell, Sony, Huwei, and BlackBerry. Interestingly enough, At&T tops the list when I would have expected a company like Google or Apple to be forefront contenders for the top spot. Google is a relatively close second with 43 lawsuits by patent trolls. Verizon and Apple are both above 40. These three tech firms are creating new content which can overstep the bounds of certain patents. However, it is easy to see that this harms the technology because when you are embroiled in a new lawsuit every week your legal bill will climb to the billions when those billions could have been going to research and development. Bringing back AT&T, I can't imagine why they would be getting into so many lawsuits when they are just a mobile phone carrier and typically no the actual producer of technology. Patents do come in many different shapes and sizes so it might contribute to the way they do business and that could be patented as well. At the end of the list, we see tech firms as well and the more established firms that are growing much more slowly than Google and Apple. 

Patent Troll: An Example

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Here is an example of how Apple, one of the leading tech firms today, lost to a "patent troll" who dropped out of 8th grade. The link is here to the article, but I will discuss and summarize it for you here. http://fortune.com/2015/02/27/how-apple-lost-533-million-to-an-8th-grade-dropout-patent-troll/ Apple infringed upon the patent of Patrick Racz because of 3 infringements which cost the firms over 500 million dollars. How did Apple lose in court? First of all, Patrick's innovation did seem out of the ordinary for someone who dropped out of 8th grade and pursued horticulture. However, his patent filings were indeed correct in terms of the ideas behind Data Storage and Access Systems. Since Apple willingly infringed upon the patent, they were sued. In court is where Apple stumbled. First, the company did not bring witnesses who had actually read the patent so when asked on the stand their specifications and details they had no clue. Also, when cross examining Patrick Racz, they focused on his lack of education and that it would be impossible for him to create such a thing despite the fact that he did. Furthermore, Apple focused on how their company is about innovation and took years to develop this idea and technology. In the end, it was the jury who decided in Racz favor because Apple came in on it's high horse thinking they were Apple and were forced to pay half a billion. Ironically, Racz is an NPE but it was an interesting story.

Patent Trolls: An Overview

This video comes from the first Harry Potter novel but accurately incorporates the idea behind these patent trolls. Indeed, they are hiding in the dungeon waiting to come out and snatch up the war chests of large companies that might have infringed on esoteric or small patents. There are many "patent trolls" but this term can be seen as highly negative because well, trolls are ugly. 

Continuing on, these trolls are also known as NPE which stands for Non-Practicing Entities. These NPEs have a mission to find patents for sale and buy them before a large company like Google can so that when it becomes infringed one way or another they can sue for millions. There are also companies like RPX which also go and buy these patents but instead of suing the firms they offer to licence out the patent to avoid major lawsuits. 

Obviousness - From Youtube

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From doing research on YouTube, this video struck me as highly informative in regard to patents and how to check for previous art in the specific field that you are looking to file a patent in. First, the video delves into how you can use EspaceNet to find patents in your related field but then goes into how Google has made a specific patent search just for those who are interested. By going to Google's patent search, you can find the entire database of patents out there since they are all published by the government. Thus, Google provides a rundown of them as well as the option to open the entire patent as a PDF. On the left side of Google Patent Search, you can click the options for specific patents like Utility which is specific to a working functioning patent whereas there is a Design option as well which focuses on design on that topic rather than a prototype of sorts. Then, once you are inside of a patent you can click to see the drawings or abstract, descriptions etc. All of this is highly necessary to define obviousness because if you are going through patents related to your idea and find that it has already been done then you are out of luck. Another issue is that if you find multiple patents that when combined cover the spread that your patent would, again it is not possible because it would then be non-obvious. 

Obviousness Part II

After doing much research on Obviousness and watching many a YouTube video, I have gotten a better perspective on what it means to be obviousness. First, prior art is extremely important because of how it allows someone to get a patent or not. Even if the person who is trying to get the patent has never seen the prior art, they might have gotten their idea elsewhere which means it might be from prior art and in turn be obvious. There is also the Teaching Motivate and Suggest Methodology which extends the prior art because if you had prior art then you could see that it was clear motivation for yours then it too would in fact be obvious. Another video mentioned the table example like our Professor did in class where they would change the number of legs or even change the paint color to have it match the curtains which would give a different utility but as it turns out that is something obvious to do based off of prior art. Prior art comes in many shapes and sizes but for the most part it is something published or previously patented in the patent office that can be pieced together to make up your entire "new" invention. Sometimes it may take many different pieces of prior art to create your patent or sometimes it will be just two combined equals your invention and thus it is obvious. All told, I learned mainly that Obviousness relys on prior art for everything. Previously, I thought it would be obvious if you could just think of that on your own based off of something else but not exactly it requires proof of the old and from there the TSM method can be used to prove that it was in fact obvious or not. 

Obviousness - Prior Art

This Youtube clip that our Professor sent us was very helpful in determining what exactly is prior art and how it is so useful in determining if something in non-obvious. Non obvious, according to the video, is something that cannot be assembled by using prior art. The clip then delved into how to find prior art. The main way to do so is to search for published articles on the subject matter and then go from there. Also, existing products can be used as prior art since they have too been "published" and are likely patented. What I found interesting was that the narrator used code as an example of prior art as well though I am not sure how you would find such large published code structures besides stack overflow and github. Also, I thought one could not patent code which was also something I had a question about because of algorithms which are like mathematical theories couldn't be patented but a machine that runs them could be. Finally, a fun fact from the video was the Thomas Jefferson was the first patent examiner though now there are so many because of how many directions our world is growing. 

Obviousness

From the lecture slides that were used in class, I learned a lot about Obviousness and what it means to patents. First of all, I thought it was interesting how there is an entire class on obviousness in most law school just because the definition is so convoluted. Taking a step back, the definition on what is patentable comes down to a process, machines, manufacture, composition of matter, or improvement thereof. So now jumping into the obvious side of things, NONOBVIOUS means that a person having ordinary skills in the art would not have thought of it given plurality of prior art. To me, this definition can be confusing as to what art and ordinary skills are. Ordinary skills means that it is someone of that subject that understands it relatively well but is not a technical professional. Take the slide to unlock patent as an example, then someone of ordinary skills would likely be an engineer who has worked on unlocking phones but is not a specific unlock expert. Now, for art. Prior art is previous work in that subject area. For the cup patents we saw a lot of prior art and how the patent of a hot and cold sleeve developed from an insulated cup. Overall, the example of the glow in the dark toothbrush was best because it seemed non-obvious at first because who would think to add a glow stick with a toothbrush to make it easier to find in the dark and maybe more exciting when brushing. However, it was obvious because someone with ordinary skill in the art could have used prior art to reach that conclusion quite easily.