Credit: Wikipedia Germany, CC BY 2.0 via Computerworld
As you can tell by the name we've given them, patent trolls aren't popular critters. The game these operators play is shady and sleazy, bordering on extortion -- though it's completely legal. What they do is to purchase patents, with no intention of using or selling them, but rather to shake down as many people as possible by accusing them of violating the patent, even if the patent troll has no reason to believe that.
President Obama has said that patent trolls are "just trying to essentially leverage and hijack somebody else's idea and see if they can extort some money out of them." And in a letter it sent last week to U.S. congressional leaders, the National Retail Federation, which rarely agrees with Obama, said that patent trolls often target smaller companies because "patent trolls know it is often cheaper and easier for their victims to settle than to become educated about the inner-workings of technology made by someone else."
The NRF has now created the Patent Reform Coalition, which includes as members Amazon, Adobe, Cisco, Oracle, Facebook, Google, Macy's, JCPenney's and Williams-Sonoma. But the goal of the group is not to stop patent trolls. It's merely to slow them down, to whittle away their profit potential by increasing the paperwork and disclosure burdens. The problem is that this approach could easily backfire, giving the trolls more legitimacy and legal backing and therefore increasing their efforts and boldness.
The most direct way to address these putrid patent pariahs is to directly make their activities illegal, by passing a federal law making the most heinous aspects of trolling -- such as accusing a company of violating patent when you have no meaningful reason to believe that it has done so -- illegal. That would allow victims to much more easily pursue federal criminal and civil charges. But the NRF chose not to go that route, for the pragmatic reason that it feared it would be too difficult to phrase legislation that would halt patent trolls but wouldn't also infringe on legitimate patent protection efforts.
The compromise was to make trolling more onerous. The NRF is now lobbying for more transparency, in the form of demand letters that would have to "explain in detail the basis for the alleged infringement. Current law does not require that a patent holder explain how a patent is infringed, or even identify the product involved, which makes it nearly impossible for someone who has been sued to evaluate the case and decide how to proceed," the NRF said in its Jan. 15 letter to four House and Senate leaders.
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