What the heck is a patent troll?

What is a patent troll?

Everyone in the patent community has a general idea of what makes a patent owner a troll, but I can't find a litmus test definition anywhere.  If you've got one, please put it in the comments.  I'm looking for a definition that allows me to decide if a particular patent owner is, or is not, a troll. 

Based on several popular media accounts of NTP (of BlackBerry fame) and other famous trolls, I have the following questions relating to the term:

Must a patent owner eschew commercialization of the claimed invention to qualify as a troll?

Are you a troll before you sue someone who has commercialized the claimed invention?  Or are you magically deemed a troll once you seek to enforce your patent?  Are preliminary licensing negotiations enough to earn the moniker, or must you actually file suit?

Can you be a troll on the day a patent issues only later to earn the right to shed the term, perhaps when you start commercializing the invention?

Can an inventor be a troll?  Or is there some sort of requirement that the patent owner acquired the patent from the inventor or some other previous owner?

Is it enough if that acquisition was part of an ordinary business transaction, or must it have been through some sort of "fire sale" or bankruptcy proceeding, as some have suggested?

There seems to be consensus on a threshold requirement that, to qualify as a troll, the patent owner must not have made use of the invention.  But, even that is vague.  In my mind at least, it raises more questions than answers.  What the heck does "make use of the invention" mean?  Must the invention have been commercialized?  To what extent?  Do initial commercialization activities qualify as 'commercialization', such as market testing, prototyping, and the like, or is actual shipment of product and/or provision of service required?  Could a real troll duck the term if legally advantageous by doing some quick and dirty rapid prototyping?  Market surveys?

Maybe the Supreme Court will fill the gap with its forthcoming decision in eBay v. MercExchange.  A little dicta could go a long way on this issue.  Let's just hope we don't see an "obscenity style" definition.

 

Comments

Comments

David French writes:

Here is a thought as to what makes patent trolls so dangerous. They choose as their victim companies that are heavily invested into using patented technology.

These are not companies that are administering patent rights in order to assist a startup. Negotiations with the erstwhile infringer are not occurring at a stage where no one knows whether the technology will succeed. Rather, trolls are asserting patent rights against patented technology that has proven to be a success.

In this context, negotiating leverage is drastically shifted in the direction of the patent troll.

This is not the whole story, but surely this is one aspect.

David J. French

Why is it okay for IBM to license its patents and not okay for "patent trolls" to do the same thing?

Trying to Burst the bubble - Just another troll?

So last week we asked ya'll to give us your best shot at a litmus-test definition for the term "patent troll."  It's an understatement to say that the response was somewhat underwhelming.  We received a grand total of......zero definitio...

The way large corporations are bashing small patent holding outfits, by calling them patent trolls, makes it appear as if these large corporations are in all earnest being harmed by the mere fact that these small outfits have decided not to actively compete with them.

You would think that NTP is greatly harming RIM by not having commercialized the invention themselves. Or that Mercexchnage is doing Ebay a great injustice by not having themselves created a great online auction website. Is this some kind of joke, they’re pulling?!

Practically, Ebay is telling Mercexchange the following: “You better gear-up your efforts; invest millions; and start seriously competing against the giant Ebay service. Otherwise, you dare not sue. If you cannot or will not put up a big competition fight, then you’re just a measly patent-troll, and just leave mighty-Ebay alone”.

According to Ebay/RIM, patents should only be awarded to successful businesses and entrepreneurs. If you succeed in business, and survive rough and tough competition, only then should you be allowed to assert your patents (which typically about 4-5 years after you file them). But if you dare lose, if you dare become out dwarfed by some heavyset champ with lots of marketing power and cash; if your dare belly-up (bankruptcy); then just forget about your patents. Patents should only be awarded to successful businesses! If you’re successful in business, then lucky you, is afforded the right to exclude others, and create a monopoly (e.g. big pharma). But if you cannot survive this “dog-eat-dog world” world, then just too bad. No patents for you.

THIS IS JUST PLAIN LUDICROUS!!

Patents were never meant to reward business success or enterprise. It is the “profits” that reward successful businesses and entrepreneurship. Yes, “big fat profit margins” are the rewards for a successful business; not licensing fees and the “right to exclude others”.

Patents are meant “only” for the reward of innovation, invention and the fire of genius. Nothing else.

Nothing should require an inventor/innovator to put his patents on the hook. Nothing should require an inventor to risk his patent (as well as all his hard-earned savings) into some undercapitalized start-up, and then attempt a desperate campaign against the Microsoft’s and Ebay’s of the world. And then, after failing miserably, sadly watch his hard-earned money, patent and all, go down the drain into a messy bankruptcy.

Shouldn’t inventors be allowed to live respectable lives, and not be forced into miserable “start-upping” against some overkill giant competitors?

This defamation and libelous attacks of corporate America, must be stopped short in their tracks, before it’s too late. Just look at today’s headlines “Intel helps form group to reform patent litigation abuse”. The writing is on the wall. Independent inventors and small outfits must band together before it’s too late.

Patent Troll:
1) (n) Plaintiff enforcing any patent against a larger entity.
2) (v) Term of derision (trash talk) by large entity used in an attempt to appear innocent.
See also Red Herring (Currently used to confuse efforts to improve patent quality through USPTO reform)

I believe a Patent Troll should be defined as an individual or a business that patents an idea with no intention of making use of the actual ideaa.

Or, an applicant that patents an idea with the intention of making money from the issue of the patent itself, not the idea mentioned in the patent.

David French writes:

You raise a fundamental question about patent law. For many countries in the past, including Canada until 1923, after an initial period of time, e.g. three years, a patent would not be valid unless the invention was being manufactured in the patent-granting jurisdiction. This was never part of the United States patent law.

From the inception of the Paris Convention in 1883, the United States campaigned against this type of patent law policy of requiring "local manufacturing". A review of the history of the Paris Convention will show regular revisions that tightened restraints on a country's ability to insist on local manufacturing as a condition for the exercising of patent rights.

Then the TRIPS protocol of the 1986-94 Uruguay Round under GATT http://www.wto.org/english/theWTO_e/whatis_e/tif_e/fact1_e.htm
closed the possibility for making patent rights conditional on local manufacturing in any respect.

As a successor to GATT, WTO rules have gone on to stipulate for minimum standards for patent laws, standards beyond those imposed under the Paris Convention:

"The agreement describes the minimum rights that a patent owner must enjoy. But it also allows certain exceptions. A patent owner could abuse his rights, for example by failing to supply the product on the market. To deal with that possibility, the agreement says governments can issue “compulsory licences”, allowing a competitor to produce the product or use the process under licence. But this can only be done under certain conditions aimed at safeguarding the legitimate interests of the patent-holder."

Another rule, rooted in the Paris Convention, is that countries cannot discriminate under their national law on the basis of nationality.

The issued today is:

Can a country, without discriminating against foreigners, condition patent laws on whether or not the invention is being produced at least somewhere in the world?

This is relevant to the issue of definition of patent trolls because rights and obligations under national laws cannot discriminate on the basis of nationality, and there has been a faction of the world patent law community that has campaigned for over a hundred years against territorial discrimination under national patent laws.

Therefore any special treatment for patent owners who merely hold patent certificates certainly cannot discriminate against foreigners and probably, cannot discriminate against patent owners on the basis of the territories in which they are active in exploiting their patent rights.

More could be said. However I simply raise for now the international context associated with these issues.

David J. French

I doubt the Supreme Court will even give dicta on the "troll" issue. While there was some light-hearted questioning during the oral argument, the patent owner had actually used the patent. The owner licensed the patent to others and had tried to commercialize the invention (with little success).

Of course, this may fit into your question of what constitutes a "troll." Does attempt to commercialize count for anything?

While I think the SCOTUS will skirt the "troll" issue, I'm sure that the eBay decision will be very important with regard to the injunction issue. I guess we will see . . .