But what if, in the name of cracking down on trolls, Congress passes an anti-troll law that winds up having huge negative consequences for legitimate inventors? What if a series of Supreme Court rulings make matters worse, putting onerous burdens on inventors while making it easier for big companies to steal unlicensed innovations?
As it happens, thanks to the 2011 America Invents Act and those rulings, big companies can now largely ignore legitimate patent holders.
Of course, they don’t call it stealing. But according to Robert Taylor, a patent lawyer who has represented the National Venture Capital Association, a new phrase has emerged in Silicon Valley: “efficient infringing.” That’s the relatively new practice of using a technology that infringes on someone’s patent, while ignoring the patent holder entirely. And when the patent holder discovers the infringement and seeks recompense, the infringer responds by challenging the patent’s validity.
Should a lawsuit ensue, the infringer, often a big tech company, has top-notch patent lawyers at the ready. Because the courts have largely robbed small inventors of their ability to seek an injunction — that is, an order requiring that the infringing product be removed from the market — the worst that can happen is that the infringer will have to pay some money. For a rich company like, say, Apple, that’s no big deal.
What got me thinking about this was, in fact, a recent lawsuit between Apple and WARF over a University of Wisconsin innovation that Apple uses to help speed the processing time of several versions of the iPhone and iPad. Apple not only couldn’t be bothered to license the patent; it wouldn’t even let WARF in the door to negotiate. Instead, Apple sent the foundation a link to a page on the Apple website, which says that the company can lay claim to any unsolicited idea. So WARF sued. What choice did it have?
Last week, a jury ruled in WARF’s favor and then ordered Apple to pay some $234 million. Although I hear that WARF is pleased with the outcome, Apple is actually the big winner. Thanks to efficient infringing, WARF never had the chance to grant an exclusive license to an Apple competitor, which could have hurt Apple while maximizing WARF’s financial gain. WARF had to resort to expensive litigation to get what it should have been able to achieve through less expensive negotiation. And, of course, $234 million is pocket change for Apple. This is “patent reform”?
There are new patent reform bills in both the House and the Senate that are once again allegedly aimed at trolls — but will, once again, effectively tilt the playing field even further toward big companies with large lobbying budgets.
“This is not about trolls,” says Brian Pomper, the executive director of the Innovation Alliance, which supports inventors. “Trolls are a fantastic narrative for companies that want to get their patents cheaper.” The recent changes in patent law also show “how big companies can use Washington to get a business advantage,” he added.
For the sake of real innovation, and in the name of the small inventor, who holds a special place in America’s mythology, the pendulum needs to start swinging in the other direction.