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Inventors, or patent trolls?
September 15, 2005
Patents remain not only valuable legal tools for maintaining control of intellectual property--they're also the engineer's equivalent of a hit recording or best-selling novel.
There are downsides to patents that I have cited: the secrecy that often surrounds the patent application process can have
life-threatening effects. In addition, inventors can
sit on patents with no intention of marketing the inventions themselves, only to file infringement suits against someone else willing to take the risk of designing, producing, and marketing a real product.
Magnifying this last problem, the patent process is prone to abuse from people who simply look for technical trends and
submit overstuffed claims that baffle patent examiners. That was the situation in which Cognex had to take on the Lemelson Foundation to assert its rights to make products based on certain bar-code and other machine-vision technology, a case that was
decided in favor of the good guys.
But now what critics call "patent trolls"--organizations having noting but a few broad patents and a team of lawyers--are back. As reported in the Wall Street Journal, these groups include Acacia Technologies, which has acquired 120 patents in areas ranging from credit-card fraud protection to hearing aids and which has filed patent-infringement suits against companies including Intel and Cablevision.
The Journal article reports that one Douglas Fougnies, whose resume includes making phony new-vehicle titles for stolen cars, has moved on to suing cell-phone companies for patent infringement. His company--which owns six patents--has won $128 million in damages from Boston Communications Group (BCG) and four other companies over alleged misuse of a 1998 patent covering a prepaid cell-phone system, a seemingly relatively obvious technology pursued as early as 1994 by BCG engineers, who never even considered the need to file their own patent. That will turn out to have been a big mistake if BCG doesn't succeed on appeal.
In an effort to prevent large awards to patent trolls, some companies are supporting a House bill introduced in June by Texas Republican Rep. Lamar Smith that would limit remedies for successful plaintiffs that don't make products. An even better solution would be to have patent examiners less willing to grant broad patents to obvious technologies.
Posted by Rick Nelson on September 15, 2005 | Comments (2)
