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How Patent Trolls Harm the Economy
WebMink writes "It used to just be speculation, but the numbers are now in — patent trolls are costing America jobs and economic growth. Newly-published research using data commissioned by Congress shows big rises in patent troll activity over the last five years — from 22% to 40% of all patent suits filed, with 4 out of five litigants being patent trolls. Other papers show that jobs are being lost and startups threatened, while VC money is just making things worse by making startups waste money filing more patents. Worst of all, it's clear this is just the tip of the iceberg; there's evidence that unseen pre-lawsuit settlements with patent trolls represent a much larger threat than anything the research can easily measure."
Sorry, a previous filing by Mr. A. Coward means you fail to get the patent, and you owe HIM royalties.
This study only looks at the first order effects. What about the technologies that are going undeployed or never see commercial application because of patents and copyrights? They were originally supposed to inspire innovation, not inspire innovative people to flee our country to sell their work overseas. I have any number of ideas that could create jobs and help our economy that simply aren't possible in this country because of our stupid laws.
Take auto-updating software and system security. Right now, the only thing the end-user has is overpriced anti-virus and malware software, and they have to go to "Geek Squad" or some other place and pay an arm and a leg to do routine maintenance. If I could package and distribute software, and somehow integrate licensing and payment into a single deployment platform, I could help people keep their software current and establish my own "app store", but with finer-grained controls and the ability to not just download and install software, but actually integrate support for the product as well. No more searching for a phone number to call, or floundering with "how do I do X in this?" If you got infected with some malware, someone could remote in anytime and fix it, at a very low cost due to economy of scale.
But unless you're a multibillion dollar company like Apple, Google, or Microsoft, there's no way you can hire enough lawyers or have enough market clout to get something like that off the ground. The cost of entry into the market is so high that only mega corporations can afford it. Rather than lowering the barrier to innovation, it's created a massive wall to it, where only a select few can release anything new.
And then we get crap like the FCC -- they botched the digital TV transition so bad they should all be hung by their balls in the public square until they drop off. It was pure profit, and the consumer suffered in terms of price fixing, limited supplies of converter boxes, and the spectrum that was sold off hasn't really benefited them in any way -- they took public spectrum and made it private, while raking in billions. And then they cost us billions more in conversion costs, when they should have been using the money from those auctions to help out the people they forced to upgrade in the firstplace. This is the kind of shit copyright and patenting do -- force people into only a handful of solutions, all overpriced and not competitive, and deny anyone else the chance to come up with a better solution that would benefit someone other than the corporate overlords.
#fuckbeta #iamslashdot #dicemustdie
First, I am no fan of patent trolls. However, both the article's headline and the slashdot headline are misleading.
The article claims "the numbers don't lie." The "numbers" it speaks of are basically the results of a survey in which one researchers polled a few startups and asked them if patent trolls were an issue. Quite a few said yes.
But the number is entirely without context. To use a slashdot favorite, the existence of cars also puts buggy whip manufacturers out of business and "costs them jobs." Just because something has an adverse effect on somebody's business.. or in this case somebody's potential business doesn't make it bad for the economy. in fact, taken as a whole you'd be hard pressed to find a legitimate study (not some boldrine and levine ass-pulled crapola) that suggests that patents taken as a whole are bad for an economy and for r&d - quite the opposite, taken as a whole, they're very very good. are there rough edges in patent regimes? of course. but i'd argue that patent trolls aren't really the problem. the real problem is the granting of patents unnecessarily for obvious bullshiat. if that goes away, then the sort of patent trolls that peopel complain about go away.
i have no problem with legitimate patent trolls, by which i mean some small company has made some innovation and then sues the hell out of some large company who simply ignores the small company's prior art. too many of you on slashdot are ironically too pro big business by proposing systems by which big companies could more easily do just that. legitimate holders of worthy ideas who lack the resources to turn those ideas into products have a financial incentive to license or transfer the ideas to those who can. and if they do get treated unfairly, like the guy who made the intermittent wiper blades was, then by all means, sue sue sue.
it could be that "patent trolls" really are a drain on the economy, but this article makes no such case. let's not forget that to somebody wanting the IP of somebody else, it's often convenient to "cry troll" and complain about all sorts of doom and gloom. i mean, darn that patent troll, oh, i dunno, porsche with their patent on some innovative brake mechanism who are keeping me from developing the next generation supercar and hiring tens of thousands of workers to develop it! if only they weren't such patent trolls hanging on to patents for the inventions that they developed!
more likely than not, this is only so much more verbage, planted here on slashdot where most anti-IP slanted stuff, no matter how specious, gets modded +5.
. . . but can litigation really fuel a whole country . . . ?
The members of Congress might want to change this . . . except that most of them are professional lawyers.
Oh, well.
Schroedinger's Brexit: The UK is both in and out of the EU at the same time!
Patent trolls will continue to be a problem as long as the patent laws aren't revised. The trolls are merely a symptom, the laws are the cause.
Pretty good is actually pretty bad.
Unfortunately, Mr. A. Coward is an employee of Mr. Big Corporation. In the fine print of his contract, all rights to patents are assigned to Mr. Big Corporation, his employer. If you think I am joking, take a gander through a patent database, and take note of the "Assigned to:" field.
He still gets to have his name on it, though.
Schroedinger's Brexit: The UK is both in and out of the EU at the same time!
http://www.youtube.com/watch?v=768h3Tz4Qik
on stories complaining about absurd patents
pay up slashdot
intellectual property law is philosophically incoherent. it is your moral duty to ignore it or sabotage it
RIGHT NOW!
No matter how much I dislike patent trolls, I view this kind of report with the same skepticism as I view RIAA reporting how much they "lose" to piracy every year.
Why should anyone suddenly care about what hurts the economy?
- Environmental trolls harm the economy by stopping commerce and development, often with zero benefit to the environment.
- Malpractice lawsuit trolls raise the cost of health care, which is bad for the economy.
- Government union trolls continually seek to provide fewer government services for a higher cost, which is bad for the economy.
- Education union trolls do the same for education, which is bad for future productivity and bad for the economy.
- Disability lawsuit trolls, who sue businesses for such evils as having signs a few inches too high or too low, cause harm to those businesses and the economy.
- Defense appropriation trolls, who spend government money in thinly-veiled giveaways to crony companies, take money from productive enterprise and funnel it to non-productive uses. This hurts the economy.
- The same goes for green energy grants to cronies, arts-related grants to cronies, and transportation appropriations to build vanity projects.
- Shareholder lawsuit trolls, who sue because their stock went up or down, cause harm to businesses and the economy.
- Race grievance trolls, who tell companies to spend their time meeting workforce racial quotas instead of producing goods and services, hurt the economy.
- Class action lawsuit trolls, who sue for millions and then settle the lawsuits for millions of dollars for the lawyers and a $1 off coupon for their clients, hurt the economy.
- Farm trolls, who have convinced the government to write them checks not to farm, hurt the economy.
Clearly the patent system needs some reform to rein in the patent trolls. But what about all the rest of the trolls that hurt the economy? Can we reform them too please? Or are we all just pretending to care about the economy this time as an insincere talking point?
The character in Henry VI, not what you first thought (you insensitive clod!), was spot-on. "The first thing we do, let's kill all the lawyers."
As long as 99% of all American politicians are lawyers, and lawyers can make money from patent law, there will never be meaningful patent reform. Until enough of a voting block decides that attorneys make poor statesmen as a class and throws the lot of them out of office in favor of truly populist, honest representatives, we're stuck with what we've got.
Patent law, civil torts, and personal injury are all areas where the Rule of Law has been perverted into the Rule of Lawyers.
Nothing short of an electoral or economic revolution can rectify the problem.
Any odds-making experts care to venture an estimate on that happening?
Scruting the inscrutable for over 50 years.
Time to patent my troll fighting goat.....
Impossible, there's prior art on toll bridges.
"It used to just be speculation, but the numbers are now in — patent trolls are costing America jobs and economic growth.
Really? Wow, let's see!
Newly-published research using data commissioned by Congress shows big rises in patent troll activity over the last five years — from 22% to 40% of all patent suits filed, with 4 out of five litigants being patent trolls.
Well, that's a start... it doesn't really show that trolls are "costing America jobs and economic growth," but it shows that there are a lot of trolls.
And then suddenly we get a bunch of weasel words:
Other papers show that jobs are being lost and startups threatened, while VC money is just making things worse by making startups waste money filing more patents. Worst of all, it's clear this is just the tip of the iceberg; there's evidence that unseen pre-lawsuit settlements with patent trolls represent a much larger threat than anything the research can easily measure."
... in other words, the numbers are not actually in and this is all just unsupported speculation and vague mention of uncited papers and alleged evidence.
The problem with patent litigation is not whether the party doing the enforcement produces things, but whether the cost of the patent enforcement outweighs the value. The purpose of patents is to reward inventors, not manufacturers. If an inventor comes up with something novel that should be rewarded through the patent system, whether he builds a factory or licenses it to a manufacturer and continues to focus on invention does not change the worth of the patent. If he deserves to be rewarded but wishes to focus on continued invention instead of licensing, and a third party company is willing to pay him for the patent, it does not change the net value of the patent.
What makes patents harmful is that they are too long, too strong, too easily granted, and given the presumption of validity in court. As long as that is true, harmful patents will be harmful whether they are wielded by abusive licensing agencies or anticompetitive manufacturers. It could be even worse with manufacturers, since they are not merely maximizing direct revenue from the patent but also have a financial motive to harm their competitors. Surely the mobile device patent war has shown us that merely being a manufacturer does not prevent bad patents from harming our economy.
By focusing our disdain on those companies that specialize in patent licensing and enforcement, we are distracting ourselves from the real problems of the patents themselves. It will lead us to attempt legislation which will only prevent independent inventors from having an open market for their inventions and force them to work with incumbent manufacturers. If patents are to reward inventors, we should not narrow their markets and chain them to manufacturing. If patents are harmful, we should limit their power for everyone, including manufacturers.
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A troll, the modern internet variety at least, is something that is annoying but mostly harmless. Patent Trolls are anything but harmless.
They're more like Patent Privateers - except that instead of having letters of marque to attack foreign shipping, they have letters of marque to attack local companies and any foreign company trying to do business locally.
Worse, not satisfied with destroying their own economy, the US is repeatedly trying to extend their jurisdiction with ACTA, SOPA, so-called "Free Trade Agreements" and the like.
Marx was right, capitalism will eat itself...and patent privateers are just one of the more obvious carnivores. The capitalist ecosystem has evolved predators and, as is common with predators, both the young and the old & tired are the easy prey.
Methinks you're seriously underestimating the difficulty of creating what you've in mind.
There's nothing unusual about doing so, btw. Typically, this stems from over-thinking about the success case, while neglecting to think about what can go wrong. In real systems, basically everything that can go wrong eventually will. And things need to scale. Potentially massively.
This stuff is so hard, that not a single company out there gets it right. Not a single one. Not even Apple, Google, Amazon, Microsoft, Oracle, SAP, Salesforce, you name it. Also note that none of the various app stores even begin to try to touch support or custom-licensing with a 6-foot pole. Both are cesspools of problems in their right.
Anyway, regarding your worries about patent trolls: if you actually did pull it off, then IP and patent issues would be, IMHO, the least of your worries.
Due to a court decision about ten years ago, patent holders now have to sue before they can discuss patent licensing. If you accuse someone of infringement, they can sue to have the patent invalidated, and they have some tactical advantages if they sue first. So patent holders don't send infringement letters any more. They have to start with litigation. That's the reason for the boom in litigation.
It's a huge pain for everyone.
Everyone knows that patents allow one to monitize valuable intellectual property and that NPE's generate wealth by agressively monetizing valuable intellectual property.
What can possibly be wrong with that? Nothing really, so there you go.
So I don't need to see no leftie 'study' that tries to argue that right is wrong and left is right, ok? I have my own truth.
I have looked several times but I have been able to find a single study that shows patents actually help the economy? Every study I find seems to show that in the area studied patents are bad.
I understand the theory on why patents should be good but in practice the opposite seems true.
Can someone point to a positive study on patents?
This linked article was interesting in that it reported how patents help VCs hedge their investment risks and thus can encougage investment and innovation. With the non practicing entities playing an important role by buying patents of failed startups. Still the article does not show that in net patents are a benefit even there.
"We" have been here before. Politics never seems to change. The following is a very loose description of a complex process over a few hundred years. It's hardly exact history, but it's reasonably true and close enough for government work.
Somewhere between 1750 and 1850 the Brits invented the Enclosure Acts as a way of throwing people off the "commons" (and off of their own property). It's not the only time when this occurred, but it was significant.
The dumbed-down version is that to keep the crappy little piece of land that had been in your family for a couple of centuries you had to build a fence or plant a hedge around it. Of course the cost of either of these was more than the value of the land.
A lot of people became dispossessed and their decedents wandered the roads of Great Brotain for two or three generations begging and starving. The smart guys sold out for the few pennies they could get and bought a boat ticket to the colonies.
When they arrived, many of them had one simple goal - to find a piece of ground, draw a circle around it, and make sure that no one ever gor to f%ck with them again.
The Native Americans never had a chance.
For those who need the still more dumbed-down version: The 16th and 17th Century British Aristocracy invented property and made sure that they got to keep most of it. Currently, Corporate America invented "Intellectual Property". In order to do this they corrupted the Patent Office and the Patent Court.
Prior to the Enclosure Acts, any peasant could raise a goat or a cow on the commons. It was part of their livelihood for a lot of years. Once they got thrown off their own land and the common land the got the "opportunity" of working for one of the pre-industrial revolution factories.
By the time of the American Revolution, British Manufacturing had become so sophisticated that no one in the colonies had a chance of setting up a competing factory. (Kind of like us and China btw).
And all this intellectual property crap does make a difference. When Lotus sued Borland, claiming that Borland's Quattro Pro spreadsheet emulated the "look and feel" of Lotus 1-2-3, it took ten years to get the judgment overthrown. During that period of time, one of the most creative companies in the US was unable to get financing. The couldn't even sell the company.
By the time they got out from under the judgment, the bean counters wound up in charge of Borland and Microsoft had moved on to the .Net platform. Borland's Delphi was a significantly better RAD development tool than Microsoft ever dreamed of, but by the time Borland was again able to compete, it was too late.
When you are dancing with wolves, never limp
Think of an idea, a software package, a new widget. Now, you willing to play roulette and try to build it without first making really sure that someone isn't going to sue you? Or will you first pay lawyers to research patents? And incorporate to cover your ass? How much will you spend before you even begin to do anything with your idea? Unless you REALLY love this thing are you even going to bother? Look at the huge mountain of hassle and money in front of the pursuit of any idea, is it any wonder that so few really seem to pursue their ideas? Most of us have lives we'd like to remain somewhat sane...
Build it, Drive it, Improve it! Hybridz.org
Your statements are so retarded.
People go to court because there is a genuine disagreement over something
Yea... I doubt anyone would ever take someone to court just to drag them through a lengthy court battle to cause financial ruin... nah, surely that wouldn't happen.. right? wrong, happens all the time.
Given competent counsel, you would expect that each side wins about 50% of the time (i.e., a coin flip)
bullshit... in reality the side with more $$ to throw at the lawyers wins.
Settlements happen because one side knows they have a loser case and are trying to mitigate the damages
If you don't want to settle, have to keep paying the lawyers somehow to represent the case - lawyer firms don't run a charity. You have no choice but to settle most of the time, even if you've done nothing wrong. There is no way in hell you can pay your lawyers to defend your case if you have a small business to defend. Small business means even if you win the case, there's no way in hell you can recoup the money you wasted on lawyers. As for the patent trolls, they can keep suing the hell out of everyone and they have nothing to lose.
invalidating an already issued patent (with good prior art) is much less expensive than most patent settlements
bull shit. Apple. several dozens of prior art. Samsung still lost the case because idiot jury thinks "prior art runs on a different cpu hence must not apply". That's like saying you patented window hinge? ooh that must be completely valid brand new patent even though it's the same exact hinge used in a door, the door hinge doesn't count as prior art because it's attached to a door, and this is totally brand new because it's attached to a window. zomg, idiotic shit likes this makes it to court and despite being laughable, it is a crippling nightmare. It's a total waste.
In the end, frivolous patents and their trolls cost everyone billions, and the only people who make a profit are lawyers... and that's exactly why the patent system isn't going to change - because the lawyers profit from it. We have a country run by lawyers. They wouldn't dare change the law in a way that could hurt their college buddies. The whole thing is mind numbingly idiotic, yet there's nothing anyone can do about it. Then there's idiots like you who say patent abuse is somehow alright. Bull shit.
We already know how bad the impact of patent/copyright trolling is, even before they came up with the numbers.
For years and years, - if not for more than a decade, - so many unwarranted lawsuits had been filed just to satisfy the insatiable appetites of the patent/copyright trolls.
I don't, not even for a femto-second, believe that the critters on the Congressional Hill do not know the damage done by patent/copyright trolls.
They already knew what happened, it's just that they had NO INTENTION TO CHANGE.
The more patent/copyright trolling lawsuits got filed, the more the lawyers' lobbyists will pay them congresscritters.
I can bet, with my bottom dollar, that no concrete change will be forthcoming from Washington D.C.
They may pay some lip services - after all, they _ARE_ politicians - they may even "Ooooms" and "Aaaahs", pretending that they are doing something, but the final outcome will be the same old, same old.
As long as the lawyers get paid, they will pay the congresscritters.
And as long as the congresscritters get paid, all of us get screwed.
Muchas Gracias, Señor Edward Snowden !
"I doubt anyone would ever take someone to court just to drag them through a lengthy court battle to cause financial ruin. ... nah, surely that wouldn't happen.. right? wrong, happens all the time"
Retards like you might ... however, anybody represented by even halfway intelligent counsel doesn't bring unwarranted lawsuits. Most businesses are in it to make money. Dragging someone into court solely for the purpose of causing financial ruin is both extremely risky business and financially dumb. They could face antitrust claims as well as other claims against them for doing something like that. Of course, if it happens "all the time," you should be able to rattle off 20 or so patent lawsuits that financially ruined a company. I'll be waiting .... oh wait, you don't know of any?
"bullshit... in reality the side with more $$ to throw at the lawyers wins"
Hardly. The well-established companies don't like patents because (i) they are always taking other company's technologies and (ii) they lose patent lawsuits against them. For example, just Google uniloc + microsoft. That being said, don't let the facts get in the way your of your anti-patent rant.
"You have no choice but to settle most of the time, even if you've done nothing wrong." ... however, they are terrible at representing the law. There are 2 main ways of getting around a patent lawsuit: (i) their patent is not invalid and (ii) you are not infringing. If their patent is invalid, you can get the USPTO to invalidate for you (and have the lawsuit stayed) for a small fraction of a settlement. If you are clearly not infringing (and you win), you have a very good argument that the other side should pay your legal costs. Regardless, if "you've done nothing wrong," then there are mechanisms by which
Hardly. FYI – slashdot articles may be a great way to learn about new technology
"That's like saying you patented window hinge? ooh that must be completely valid brand new patent even though it's the same exact hinge used in a door, the door hinge doesn't count as prior art because it's attached to a door"
You really don't know what you are talking about. That rejection would be made 99% of the time at the USPTO. As for the Apple/Samsung thing, instead of going to the jury, Samsung could have filed a reexamination request with this alleged "prior art." The USPTO is all too happy to reject patents these days. There is an extremely high rate of getting patents overturned (or at least modified) on reexaminations at the USPTO. My guess is that the prior art wasn't as good as Samsung claimed it to be.
"in the end, frivolous patents and their trolls cost everyone billions"
In the end, you have NO F'N IDEA whether or not a patent is frivolous or a lawsuit is frivolous. It would take someone experienced days and days to independently verify any claim such as that.
You only know what interested parties tell you. If you listened to Fox News, Obama is the worst president . ever. If you listen to democrats, Mitt Romney will cause millions of elderly to lose access to healthcare. Reading slashdot about software patents (or patents in general) is like watching Fox News about Obama. Don't ever expect anything positive to be said and expect misrepresentations every second sentence.
Slashdot is feeding their readership the narrative they want to read (i.e., patents are bad). I would have hoped that slashdot would be a hotbed of critical thinkers boy was I wrong. You guys gulp down this BS faster than a tea bagger reading a story about Obama's fake birth certificate.
The whole thing is mind numbingly idiotic, yet there's nothing anyone can do about it. Then there's idiots like you who say patent abuse is somehow alright. Bull shit
QQ
I wonder if any of the candidates will take note of this and pledge to stop patent trolls in order to bring more jobs back...
...are there copyright trolls, too? Strangely I never heard this term. Maybe because copyright does not harm big corporations like patents? Why should I care for one and not the other? 'Patent troll' is a propaganda concept of huge companies like Apple, Microsoft and others against small companies which throw a spanner in the works of their profit interests. For me as average consumer I could not care less. Or who really thinks that savings will reach the end user? The corporations just want to use inventions for free. Not much different from people who download stuff and are sued into oblivion by copyright trolls.
This book (http://levine.sscnet.ucla.edu/papers/imbookfinalall.pdf) gives a quite thurough explanation of how patents and other intellectual property does much harm and little good by comparing the success of various fields before and after they got patent protection. According to them, there is no evidence that patents increase the rate of invention or the rate at which inventions are brought to market - rather the opposite.
Has the current Slashdot readership really become so retarded than unfunny jokes like this, repeated for the n-millionth time, are still getting modded up to +5?
How the mighty are fallen.
Are you suggesting that many of the slashdot moderators use similar criteria to judging novelty and inventiveness as ....?
And isn't Apple the biggest patent troll of all...
You wouldn't build a gate across a public road!
The police would remove it and throw you in prison.
Obstructionist patents and copyrights are gates across public roads.
Obstructionist patents and copyrights should be stripped via eminent domain laws and the abusers thrown in prison.
They are unfairly extracting value from society without contributing - just like counterfeiters and should be treated as such.
...make it where, if you wish to enforce a patent, you MUST have developed AND RELEASED (e.g. actively selling) a product/whatever OR have licensed the patent to someone who is selling a product within say, 3 years of the patent being granted. If you do not, then the patent expires. If you do, then the patent remains valid for 4 more years (or some arbitrary amount of time), then the patent expires.
Problem solved.
I work for a Fortune 300 company who I don't want to name. We do most of our business in North America but are trying to grow in China and we do have a presence there. My company continually beats it into the heads of all employees that we do not pay bribes to anybody to get business and we'd rather lose the business than pay a bribe. So I suspect that what Dan Harris says is probably right. I've been to China and I have friends who live there and my impression from my trips is that the "loss of freedoms" is somewhat annoying and not much else. For example, you can't get into Facebook. But people who live there complain as much about their government as people in the west do, it's just that they are complaining about various injustices and corruption instead of stuff like "I don't like Obamacare".
Sure, you're going to "fix" it for me. And with the "someone could remote in anytime" door open, the next thousand malware developers, script kiddies, and DRM dealers will be happy to "fix" my computer, too.
I say that if you're a third party who wants to sell me some application, you sell it without DRM and without opening up any network back doors. You want to play Big Brother with someone's computer, do it with your own.
The problem could be fixed in either the courts or congress if we had a strategy of what to do.
Possible directions:
There is a mismatch between how easy it is to get a patent and presumption of validity when you get to court.
It would help a lot if the court was more skeptical and required the owner of the patent to prove it was unique, useful, non-obvious, and that the person who patented the gadget either had implemented it or at least had the ability to implement it at the time of issue. This should be required of the patent holder without incurring costs to the person they wish to sue. Kind of like doing job the patent office was supposed to have done but just in time, when it matters.
Requiring a working model at the patent office would be nice.
Changing the idea that a patent is not IP, but rather permission to sue to protect the inventor's ability to manufacture and sell his product. If there is no business to protect after 5 years, then the patent failed the usefullness test. (Wasn't useful to him.) Selling the patent is not permitted unless it transfers with a useful business supported by the patent. This would be a problem for the guy who invented the intermittent wipers, but today with the Internet if the guy can't figure out how to sell something on his own in 5 years, as an inventor, I think I'm ok with that. Strange sham business arrangements attempting to circumvent this need not apply.
Just because it's done on a computer does not make it new or unique. The idea being patented should be able to stand without the computer.
If we have known how to do it for a long time, but technology just became available then patenting it now that is is practical should not be permitted. The patent should be on the new technology that made it possible, not on the old application that is now practical. (Even if the money is in the old application.)
We need a better test for what is obvious. A problem with many folks openly working on a problem and only one succeeding is a good test. The McCormick reaper is a good example. These are the sorts of fields we need patents to encourage folks to solve problems. A patent that starts a whole new field is a rare, but very useful exception. (Perhaps the few of these a year should be signed by the President with a ceremony.)
Posting AC b/c I'm a little too close to the target here.
Any tech people know the name "Bob Zeidman"? Look him up. He's a tech patent troll, and proud of it.
Also I believe he reads Slashdot, I'd love to see him come on here & join the discussion.