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Ask Slashdot: When Is Patent License Trading Not Trolling?

Posted by Unknown on from the middlemen-like-to-think-that dept.

LeadSongDog writes "A piece in yesterday's Forbes offers arguments on why not all 'Non-Practicing Entities' are 'Patent Trolls.' Comments here on such businesses are often critical. Is there a right way to trade in patents for profit without abusing the process?" From the article: "The Founders’ decision to foster non-practicing entities and patent licensing proved crucial to America’s rapid technological progress and economic growth. Patent records from the nineteenth century reveal that more than two-thirds of all the great inventors of the Industrial Revolution, including Thomas Edison and Elias Howe, were non-practicing entities who focused on invention and licensed some or all of their patents to others to develop into new products."

14 of 191 comments (clear)

  1. Thomas Edison by Anonymous Coward · · Score: 2, Insightful

    Great example - just not for their cause.

    1. Re:Thomas Edison by Sarten-X · · Score: 3, Insightful

      He made his students' research into actual working inventions. That's what patents are supposed to cover - the working form, with all of the show-stopping problems worked out enough to have a functional device. Pure research isn't patentable, because without an application it just adds to the pile of useless facts about the world.

      --
      You do not have a moral or legal right to do absolutely anything you want.
    2. Re:Thomas Edison by BenfromMO · · Score: 3, Insightful

      How exactly is Edison a bad example of how the patent process works? Whether we agree with his methods on farming work out and paying employees to invent things for him, we must recognize the fact that through this system he used that he both made money, and benefited mankind through his shops and his laboratories where his employees advanced human knowledge.

      And isn't that the point to the patent system?

      To advance our technology and to advance those who invent? The people all along had an option to not work for Edison and strike out on their own, but they chose to stay in the laboratory. That was their choice, and I would argue therefore that the process worked great back than. As for today, that is a different topic of conversation because things are slightly different today than they were in Edison's time.

    3. Re:Thomas Edison by ShanghaiBill · · Score: 4, Insightful

      Yeah, Edison profited off the research of his students, and everyone around him......a bad example to be used if they want to prove patents are useful.

      And an even worse example if you want to show that NPEs are useful today. That fact that independent inventors were useful a century ago is irrelevant. They play very little role in modern innovation. Many companies refuse to even talk to independent inventors, because knowledge of their patents can expose the company to liability. What most NPEs do is sit on the patent and wait for someone to independently come up with the same innovation, and then demand payment. They are just parasites.

    4. Re:Thomas Edison by pnutjam · · Score: 4, Insightful

      Patents were useful in a time where the written word was expensive to produce in quantity and ideas could easily be lost. This is just not the case anymore. Our population alone has put us into the million monkeys on typewriter range.

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      Cheap storage VM.
    5. Re:Thomas Edison by AlphaWoIf_HK · · Score: 3, Insightful

      we must recognize the fact that through this system he used that he both made money, and benefited mankind through his shops and his laboratories where his employees advanced human knowledge.

      Why must we recognize that? Do you have evidence to suggest that he wouldn't have made a similar or greater amount of money in a system with no patents? As far as I know, no such evidence exists; if we required proof that a policy is effective before we could implement it, patent/copyright laws would be long gone by now.

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      Da derp dee derp da teedly derpee derpee dum. Rated PG-13.
  2. Re:Oh wow Forbes defends trolls what a surprise by i+kan+reed · · Score: 1, Insightful

    America is the country where you know that no matter how horrible and destructive someone's greed is, there will always be a news outlet to defend it.

  3. NPE and Forbes by jbolden · · Score: 4, Insightful

    More of less the article says that NPEs encourage innovation by allowing people to sell patents. Everyone agrees that patent trolls/ NPE by being willing to buy patents help to make having a portfolio of patents a valuable asset. That's not a point in question. The point in question is whether the damage NPEs cause exceeds the benefits of their funding since the money for those buys comes from lawsuits. And Forbes doesn't even attempt to answer that question. Lots of terrible things often have some side advantages that don't come close to covering the downside of the terrible thing.

  4. NPEs truly aren't the problem by SecurityGuy · · Score: 5, Insightful

    The problem is junk patents.

    Imagine you invent a device that pulls water out of the air for free (unlike anything cold, which will do it for $$$). Anywhere. Even in a desert. This is a great innovation. I have zero problem with you selling your patent to someone else. The problem I have is that right after you invent this, a horde of lawyers will storm the patent office and patent things like drinking water that came from your device. Watering a lawn with water that came from your device. Making beer with water that came from your device.

    The problem is the ridiculous deluge of patents for trivial and obvious things. They litter the business landscape and make it impossible to solve any real problem without tripping over them as you solve 100 trivial problems in obvious ways along the way. Cuz you know, who ever would have thought that the optimal number of clicks to buy something in would be 1? That must have taken a talented team of web developer (singular) literally hours to do.

  5. Theory vs. Practice by Schnapple · · Score: 3, Insightful

    In theory what a NPE does is actually quite admirable. You're an inventor and you invented something and you have a patent and big companies rip you off. They know you can't afford to fight them so they just do what they want. So you sell your patent to someone like Intellectual Ventures who goes after the big companies for you. Now no one can make your widget bolt without paying you, as it should be.

    And look what's happened - even giant companies are scared shitless to defend against patent lawsuits. In that respect, the idea worked.

    In practice though what happens is minute, even trivial things get patented and NPE's go looking for people to sue, using a byzantine series of shell companies and borderline gaming of the legal system. Whereas the inventor of the widget bolt has to make the exact specifications of how his bolt works open to the public (who could also just figure it out by looking at it) software companies don't have to make the source code of their patented inventions available to anyone.

    NPE's to me are like the NRA or PETA - organizations/concepts which started out with noble intentions (responsible gun ownership, don't torture animals) and just strayed way off the mark.

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    Schnapple

  6. It's never trolling by geekoid · · Score: 1, Insightful

    Don't let the ignorant convince you otherwise.

    Trolling is when you great a broader patent in order to try to claim royalties on existing patents.

    This nonsense about people trying to protect their rights, or license their patent, is trolling is a pile of crap.
    Generally supported by anti tort groups(i,e, insurance companies) that want to strip inventors of their rights.

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    The Kruger Dunning explains most post on /. http://en.wikipedia.org/wiki/Dunning%E2%80%93Kruger_effect
  7. Article's Definition of NPE is Incorrect by BBF_BBF · · Score: 3, Insightful
    After I RTFA, I realized that the authors' definition of NPE is a company that doesn't PHYSICALLY MANUFACTURE the product. And it's doubly disappointing that one author WAS the DIRECTOR of the patent office from 2004-2009. I wonder why the patent office is so screwed up?

    It lists Qualcomm as an NPE!?!?! WTF!?! I guess it's because they don't FAB the chips themselves.

    Qualcomm sells chips THEY DESIGN using their IP, they just CONTRACT OUT the device to others to build. How is that NOT an Practicing Entity?!? They also license out their patents for worldwide standards (WCDMA) that they may not have any part in the manufacture of the devices that use that standard.

    So by the Authors' definition of NPE, Apple is also an NPE because they contract the assembly of their I-devices to other companies and don't actually FAB their A7 processors?

    Meh.

  8. Re:Pretty much never ... by tgd · · Score: 4, Insightful

    I'm of the opinion that if you didn't create it, and your entity exists to do nothing than extort people for royalties on your patent ... you are a patent troll.

    At the risk of burning karma, I disagree... licensing organizations are not the problem. Bad patents are the problem.

    Licensing organizations are very useful, to big companies, small companies and individuals.

    There are a fairly large number of companies that exist to profit off bad patents, but that doesn't invalidate the work the "good" companies are doing.

  9. Re:Oh wow Forbes defends trolls what a surprise by ShanghaiBill · · Score: 5, Insightful

    they just license the patents.

    You make it sound like they hire a salesperson to go around and market their patent to potential customers. Or maybe you think the customers search for useful patents to license and then contact the inventor. Neither of these scenarios is common. What is common, is for the NPE to just sit on the patent, wait for someone to independently come up with the same innovation, and then demand payment. This is not contributing anything positive to the process.