Standing Against Patent Infringers – not glamorous, but necessary

Wreck It Ralph

In the end, inventors simply want the credit and justice they deserve for the intellectual property they have created.

by: Patrick Anderson | June 12, 2017

As a practicing patent licensing professional. I find patents that companies infringe and help enforce the patent rights against those companies. This, more often than not, but not exclusively, involves litigation. Anyone who’s not a regular reader of this blog will most likely think I am a bad guy, and I’m okay with that. And I am not okay with that…

Judge Hamilton, of the Seventh Circuit Court of Appeals, used a typically reductive narrative recently when describing the business of IP assertion:

In recent years, opportunistic holders of copyrights, patents, and other intellectual property have developed unsavory reputations for “trolling,” bringing strategic infringement claims of dubious merit in the hope of arranging prompt settlements with defendants who would prefer to pay modest or nuisance settlements rather than be tied up in expensive litigation.

(emphasis added)

As is typical in these cases, tying “bringing strategic infringement claims” together with the phrase “dubious merit” provides linguistic cover to demonstrate that the speaker behind these words is not opposed to intellectual property claims in general, but rather just frivolous claims. However, the unfortunate effect of this is to draw an association between “strategic” or “opportunistic” infringement assertion and “dubious” claims so that the public begins to equate the two (i.e. anyone who brings a strategic infringement claim is automatically bringing a frivolous claim.)

Of course, such a notion is demonstrably false. I won’t bother to quote you the NPE win rate from the recent PWC patent litigation study, but suffice to say it’s well above 0%. Furthermore, it wouldn’t matter if I did quote statistics; in the post-factual world of today, all that really matters is whether you believe something, regardless of what the facts suggest.

In addition, the word “dubious,” chosen by Judge Hamilton, is also worth examining for its duality. In context, Hamilton most likely imparts a meaning such as “not to be relied upon; suspect.” But another interpretation is the softer, and far more troubling, “doubtful.” Why is this troubling? Because there is always doubt! If outcomes were certain, we wouldn’t need lawsuits (or certainly not as many—you’ll always have a few crazy people fighting a losing case for no reason). There’s always some amount of doubt, no matter how well prepared your case.

For too long I’ve been content to recite the bad-guy affirmation and simply accept my role in the narrative. Since Congress will have to outlaw patents before I’ll stop doing what I do, it’s well past time to go “turbo” and re-write the script. Infringers, with their powerful lobbyists, have stacked the deck in their favor, making it ever harder for inventors to enforce their property rights. In many states, large companies commandeer inventions of their employees for compensation that ranges from “nothing” to token payments.  If inventors manage to hang on to their own patents, they can’t enforce them without a lawyer since they won’t be allowed to receive any meaningful discovery.

Thus, inventors are already forced to give up significant percentages, or spend millions in legal fees, simply to enforce their property rights. As infringers lobby Congress and persuade the Supreme Court to increase the difficulty in bringing a successful patent case, the risk is increased further. With higher risk comes higher fees or percentages, but state regulations will cap those fees as well, which means some firms will simply take fewer cases. With fewer law firms willing to represent inventors or their companies, they’ll turn to folks like me in the secondary market. In fact, the harder you turn the screws on inventors, the less favorable of a deal they’re able to negotiate, resulting in higher profits for the acquirer.

In the end, inventors simply want the credit and justice they deserve for the intellectual property they created. Of course, just as a tortfeasor almost never apologizes and admits their negligence injured someone, a patent infringer will never shake the inventor’s hand at a press conference and proclaim to the world, “We want to thank this person whose invention made our product and business success possible.” Instead, as with the personal injuries, the best you can hope for is an offer of payment that is meaningful, even if less than what is deserved.

So why do I do this? What do my kids, family, and loved ones think? How do I sleep at night? Well, I’m part of a business that helps inventors and patent owners claim their rightful payment and respect from the property they help create. Do others, non-inventors, also take a share of that payment? Of course they do. Without financing, the effort itself is doomed to failure. And if my work fails to produce a return on investment, there won’t be financing for the next inventor or company that needs my help. So I sleep soundly and look my family in the eye proudly, understanding my role in this process.

And if that makes me the bad guy, to you, I’m okay with that. … But I am not okay with that.

1 Comment

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