FTC Will Probe "Patent Troll" Problem, But Won't Sue Anyone
June 20, 2013 10:03 AM
Trolls say they serve a valuable roll protecting inventors and business partners
In response to
a request by Congress to wage war on so-called "patent trolls"
-- also know as a patent assertion entity (PAE) or non-practicing entity (NPE) -- the
U.S. Federal Trade Commission
is expected to consider solutions to the problem via a 6 (b) probe, a type of federal investigation.
I. Prepare to Be Probed
This kind of probe is authorized under the aforementioned section in the FTC Act (specifically,
15 USC § 45
), the law that created the Commission back in 1914.
FTC Chairwoman Edith Ramirez in recent months has opined that the patent system is growing too big to reasonably enforced. The technology of a smartphone, for example, was
likely covered by tens of thousands of patents
(many of which it was in infringement of) she said.
Her organization had taken a soft approach with the so-called patent trolls in
held December 10, 2012 in the capitol, co-hosted by the
U.S. Department of Justice
(DOJ). But since then Congress and the White House have been under pressure by their donors in the tech industry to take aggressive action against the trolls, who are leeching away industry profits.
The U.S. FTC is probing "patent trolling". [Image Source: TheNextWeb]
President Obama issued
five executive orders
earlier this month targeting the trolls.
The FTC will now vote on whether to launch the follow-up to its December workshop, a full probe. Given the unilateral pressure from lawmakers, this seems virtually certain.
II. Trolls Fight Back
The "trolls" have long rebuked that title and claim they play a valuable role in protecting small inventors and helping some larger firms monetize their portfolios (or liquidate investments) via lawsuit-or-license schemes.
Companies like Intellectual Ventures
, the alleged troll founded by former Microsoft Corp. (
) chief technology officer Nathan Myrhvold, and semiconductor licensing technology firm Mosaid Technologies Inc. (
Nathan Myrvhold -- an ex-Microsofter -- heads one of the largest alleged "patent trolls", Intellectual Ventures. [Image Source: ZUMA Press]
Mosaid's chief intellectual property officer Scott Burt comments, "There are companies that are engaged in spurious lawsuits, seeking settlements that are less than the cost of litigation. But not us. We are a patent-licensing company."
The NPEs (or trolls, if you prefer) are responsible for 60 percent of the roughly 4,000 patent lawsuits filed last year (up from a mere 29 percent in 2010). And many of the lawsuits push the bounds of credibility -- such as the company who patented scanning a document and emailing it, and then proceeded to sue thousands of small businesses on the East Coast. One major problem is that it often
takes more money to fight a bad patent in court
than to simply pay a small settlement to a troll.
Ms. Ramirez says the verdict on NPE's utility is still out, commenting, "A central empirical question, which we will continue to examine, is whether P.A.E.’s encourage invention or instead hamper innovation and competition."
Her board is currently short-staffed due to a deadlock in nominating a fifth commissioner. Currently there are two Democrats and two Republicans on the FTC. However, the trolling issue is arguably outside party lines as the tech companies affected donate to both parties.
The only concern about an inquiry is that it could broadly expose business information and trade secrets of alleged NPEs.
Assuming the inquiry proceeds, it's important to remember that no action will be taken -- the inquiry would only be for the purpose of generating recommendations to Congress. Congress has been sluggish in acting on the issue. But once the FTC finishes up, it may be budged into action at last.
The New York Times
"If a man really wants to make a million dollars, the best way would be to start his own religion." -- Scientology founder L. Ron. Hubbard
Apple, Google Surrender to Patent "Troll"; Vizio and Toshiba Fight It and Win
June 11, 2013, 4:17 PM
House Punts on Patent Trolls, Asks FTC to Deal With the Problem
June 7, 2013, 6:54 PM
ITC Review Upholds Apple's Ban on Samsung Nexus, Galaxy Tab Shipments
April 9, 2013, 1:42 PM
Tech Giants Form Super League to Fight Patent Suits
July 1, 2008, 1:40 PM
Are You in the Market for Earphones?
March 24, 2017, 7:35 AM
Samsung Galaxy S8, Rumored Launch Date!
March 18, 2017, 6:45 AM
How about Leica Cameras
March 13, 2017, 6:30 AM
Nokia has ditched this camera technology in its new smartphones
March 7, 2017, 8:45 AM
A Baseball Cap With Camera
March 3, 2017, 7:00 AM
Nokia 3310 with longer battery life
February 28, 2017, 7:05 AM
Most Popular Articles
Comparison – Samsung Galaxy TabPro S Vs Microsoft Surface Pro 4
March 21, 2017, 7:40 AM
Apple iPad – New Faster Processor and More Fun
March 22, 2017, 7:25 AM
Gigabyte GA-Z170X-Gaming G1 – Intel Thunderbolt 3 Certified Motherboard
March 9, 2017, 6:25 AM
Huawei P8 Lite 2017 – Android 7 Nougat Smartphone with Octa-Core Processor
March 8, 2017, 7:03 AM
Intel Optane SSd DC P4800X – Super Fast 3D Storage
March 20, 2017, 7:35 AM
Latest Blog Posts
Are you thinking of performance and speed? Intel claims:
Mar 25, 2017, 7:45 AM
Apple buys an automation app called Workflow. The deal was completed today and brings the app along with its developers.
Mar 23, 2017, 7:35 AM
Apple Announces new color for iPhones and iPads
Mar 22, 2017, 7:45 AM
Instagram: You Can Now Save Live Videos For Later
Mar 21, 2017, 7:49 AM
Samsung Galaxy S8 to Get New Color Scheme
Mar 20, 2017, 7:45 AM
What else to worry about?
Mar 17, 2017, 6:45 AM
Icon of the Day: Intel/ NVIDIA or Mobileye
Mar 16, 2017, 6:15 AM
JUST IN - Twitter Hijacked : High-Profile Account Accesses
Mar 15, 2017, 7:07 AM
Mar 14, 2017, 7:30 AM
News and Tips
Mar 13, 2017, 6:30 AM
iPhone 8 – May Not Get Curved Screen
Mar 11, 2017, 8:00 AM
California paves way to self-driving car tests without humans
Mar 11, 2017, 7:18 AM
Smart Machines V hackers
Mar 10, 2017, 7:00 AM
Uber Can Resume Autonomous Car Testing in California
Mar 9, 2017, 6:50 AM
Mar 8, 2017, 7:09 AM
Mar 7, 2017, 8:45 AM
World news 3-6
Mar 6, 2017, 5:40 AM
Mar 4, 2017, 7:40 AM
Mixed News of the Day
Mar 4, 2017, 6:32 AM
Jaguar Land Rover invests in ride-sharing
Mar 3, 2017, 7:00 AM
Mixed News of The World:
Mar 2, 2017, 7:02 AM
World New 3-1
Mar 1, 2017, 6:30 AM
More Blog Posts
Copyright 2017 DailyTech LLC. -
Terms, Conditions & Privacy Information