Linked by Thom Holwerda on Thu 24th Oct 2013 11:25 UTC
Legal

So, there's a new patent reform bill in the US that is supposed to put an end to "patent trolls".

The chairman of the House Judiciary Committee, Rep. Bob Goodlatte (R-VA), has introduced a bill [PDF] that directly attacks the business model of "patent trolls." The bill has a real chance at passing, with wide backing from leadership in both parties.

Don't believe all the cheers online - this bill is a disaster. What it essentially does is make it very hard for smaller companies to file patent lawsuits. While this does, indeed, make it harder for small patent trolls to operate, it has the side effect of shifting the balance of power even more in favour of the larger companies. Additional costs and legal legwork are a huge hindrance for small companies, but entirely inconsequential for large companies which employ the same patent trolling tactics as actual patent trolls, such as Apple's software and design patent abuse or Microsoft's mafia practices regarding Android.

With this bill, it will become a lot harder for a small, innovative startup with a great idea to protect itself against the big players. I would call that an unintended side effect, were it not that I am a huge cynic and know perfectly fine that this is anything but 'unintended'.

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Patents
by Deviate_X on Thu 24th Oct 2013 11:52 UTC
Deviate_X
Member since:
2005-07-11

So much frothing about patents, whats so bad about patents again?

By definition patents trolls are going after the money, by definition a small company does'nt have any

Reply Score: 2

RE: Patents
by Nelson on Thu 24th Oct 2013 12:12 in reply to "Patents"
Nelson Member since:
2005-11-29

To add to that, "innovative startups" have two conclusions: death or being not so small anymore. Their shelf life is often shorter than the turnaround time for a court proceeding.

and they're often overcapitalized by inflated valuations anyway, so they're flush with cash. This isn't Mom&Pops filing with the USPTO

Reply Parent Score: 3

RE: Patents
by galvanash on Thu 24th Oct 2013 17:30 in reply to "Patents"
galvanash Member since:
2006-01-25

So much frothing about patents, whats so bad about patents again?

By definition patents trolls are going after the money, by definition a small company does'nt have any


That is completely misguided logic. The root of the problem is that most of the patent trolling is happening to these small companies with no money - because most of the patent trolls don't have all that much money either.

The problem isn't so much the Sharks, its the guppies. Small outfits with just a few lawyers and one or two overly broad and probably irrelevant patents. Its a really easy way to make money - just send out a boatload of threats and collect the settlements. The only companies paying these settlements ARE the ones with no money that don't know better - the companies with money and lawyers mostly just ignore them unless they perceive it to be a real threat (it usually isn't). The small guys can't tell the difference, and they can't afford a lawsuit anyway, so they pay up.

Its extortion, plain and simple. You make it sound like the scam is all about going after wales for big paydays. There is a little bit of that going on sure, but most of the damage is small one-time settlements less than $10,000, or worse, small ongoing licensing deals. When there are hundreds or even thousands of these little papercuts going on the economic damage adds up quick. This is specifically the kind of trolls this bill aims to defang.

Unlike Thom I think this bill is actually mostly good. Its much better than the current status quo at least. Yes, it will make it more difficult for smaller companies with productized patents to bring suit against larger companies - but imo that is a small price to pay for the other reforms.

The thing Thom is not factoring in is that most small companies with a few productized patents WANT to get bought out by a big guy. The decision for a big company to buy a patent holder vs. ignoring the patent is really a calculated decision mostly based on the size and value of the patent holder - if they are small they are more likely to get paid off fairly (assuming they have a legitimate claim). Sure, you have the occasional greedy little company that wants some ridiculous royalty for their patent so they get the door shut on them - but should we shed tears over that? All in all I think Thom is making a mountain out of a molehill.

Im still an abolitionist as far as software patents go, but this is imo a pretty good effort to reform the law as far as trolling goes.

Reply Parent Score: 4

RE[2]: Patents
by TechGeek on Thu 24th Oct 2013 17:52 in reply to "RE: Patents"
TechGeek Member since:
2006-01-14

I won't condemn this act as far a Thom does, but I can see reasons for his worries. But it remains to be seen whether or not his concerns bare merit.

Reply Parent Score: 3