The Cause and Effect of Patent Trolling

Written By: Shilpa Chaudhury

The main idea behind granting Patent Protection is safeguarding the labor invested by someone in coming up with a new invention. The protection provides a monopoly to the applicant and also encourages others to come up with new inventions. Patent Protection is beneficial for business entities as they commercialize the patents and get recognition for the same.

However, there are certain entities which are known as Non-Practicing entities (NPE) or Patent Assertion Entities (PAE) who take protection over the invention but refrain themselves from commercializing the same.

These are known as “Patent Trolls.” Broadly speaking these are the companies who get profit from “Patent Infringement Lawsuits.” They acquire the patents but do not use them, instead of when any other company tries to use any similar patents, they threaten to sue for Patent Infringement or charge colossal amount of money for licensing.

Now the question arises how the “Patent Trolls” work? These companies are in constant search for new technologies or other unique applications which might be infringed by anyone in the market. Once they have targeted, they come up with plans and strategies on how these entities can be attacked.

Usually, the small business entities or shops become the target. These soft targets are then threatened by sending legal notices. In fear of facing legal consequences, most of these small business owners give in to the demands and go for a settlement.

To cite an example of Patent Trolling, a Texas-based company Somaltus LLC has sued multiple big companies such as Apple Inc, Nissan, and Ford for patent infringement. Somaltus LLC does not have an online presence and does not conduct business on a regular basis.

This is just one example, but there are many other cases which shows that “Patent Trolling” is on the rising. This is an unethical activity which directly targets the purpose behind Patent Protection.

This also increases the number of Patent litigations which creates a hostile environment for Patent holders as well as other inventors who are thinking of applying for Patent.

To decrease Patent Trolling, US Supreme Court in the case of TC Heartland Vs. Kraft Foods has ruled that the Patent infringement suit will be filed where the defendant is situated not where the plaintiff chooses.

Now, it is pertinent to mention that to stop such unethical practice, only judgments will not be sufficient, some initial background research needs to be done by the Patent offices before granting the Patent.

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