Trying to find other companies under the same threat is a great approach. In a similar situation, this allowed my company to fight a patent troll and share costs, so we didn't cave under the, "It'll cost us this much in legal fees anyway" argument.
There should be some kind of patent troll clearinghouse. Companies can check it to see if other companies are reporting the same shakedown tactics for a given patent.
Though, could a patent troll could get around that by spacing out the trolling? So by the time any company finds another company that's been trolled, they've already paid it up and don't have as much incentive to fight the patent troll after the fact.
They could even offer a "discount" conditional upon mandatory non-disclosure of the legal threat.
Most importantly, there need to be penalties for patent trolling. If you try to enforce a patent even though you must know that there is prior art (e.g. because you've been provided clear evidence of it), you go to jail. Not "the bankrupt LLC is liable to pay some money it doesn't have", the actual people behind it, behind actual bars.
Of course, the tricky part is not preventing legitimate patent litigation, but if you word it carefully enough, it could make it risky enough for patent trolls to not be worth it. The tradeoffs change when it's not LLC money at risk but the participant's personal freedom, so even if only 10% of patent trolls could be actually convicted, it might be enough to discourage the rest.
Or, of course, just dump software patents alltogether...
Regarding trollingeffects.org, someone needs to submit this current case to the them. I searched for all of the following: 7,177,838 (the patent number), Playsaurus, Clicker Heroes, deBruin/Rubin/Rudman/Jacobs (the trollish lawyers). Nothing showed up.
The site does look like it's being maintained. The most recent case I found was from June 2017:
Also noticed in the "About" section that Trolling Effects is a project of the Electronic Frontier Foundation. Which is another great reason to support the EFF.
This is Daniel Nazer from EFF. Trolling Effects is still maintained and we still welcome any demand letter submissions. This site is not one of EFF's more successful projects, unfortunately. We've found that companies are generally reluctant to publicly post the threat letters they receive (perhaps fearing a vindictive response from the patent owner). In the year or so after the site launched we spent a fair bit of time encouraging companies to submit but had very little success.
> Though, could a patent troll could get around that by spacing out the trolling? So by the time any company finds another company that's been trolled, they've already paid it up and don't have as much incentive to fight the patent troll after the fact.
That's still a minor win, since it mitigates the amount of damage the trolls can do per unit time.
While it doesn't help in this case (since there is already a looming legal threat from an NPE), you can buy patent troll insurance now: https://www.rpxcorp.com/. This covers your legal fees in the event of litigation, which can scare off a patent troll who just wants a hit-and-run settlement.
It is ridiculously disheartening that this sort of thing even has to exist.
It's just taking the money you'd be forced to pay some exploitative patent troll, and giving it (well, probably/hopefully less of it, but still) to an exploitative insurance firm instead.
The insurance firm isn't exploitative. The patent troll is actively harmfully attacking people. The insurance firm (assuming they aren't secretly creating demand for their product) is mitigating the damage.
Insurance doesn't mitigate damage, it amortizes it (typically across a group of entities). The expected average annual claims on an insurer's policies need to be lower than the sum of the premiums or the insurer loses money.
This is why people in high risk categories pay more for insurance (eg young people and people with high performance cars have higher car insurance premiums because statistically they crash more often and/or have higher rates of total loss)
The insurance being used to fight the patents seems good: it's effectively a way for the group to pool resources towards not paying out to patent trolls. The success of the insurance company should be based on the reduction of payments to trolling, even when counting the insurance as paying to patent trolls
What'd be most disheartening is if the insurance was just to pay off the patent trolls
In this case it does because someone with insurance is a poor target for patent trolls. Assuming it becomes common you get 'herd immunity' as patent trolls become less effective which also lowers the cost of the insurance.
Also, "I have legal insurance, you can talk to my lawyers" might be a turn-off for trolls, effectively diminishing what would be spent in this specific case.
Well, yes and no. For the single insured it is there to mitigate damages that otherwise would be catastrophic. I hope that I will lose money by buying insurance, because that means nothing really bad happened to me.
Normally you'd be correct, but in this case troll insurance actually produces a game theoretic reduction in trolls. Going to court costs trolls resources, time if not money. By guaranteeing that all trolls will be fought tooth and nail, it makes trolling more costly, which makes it less attractive, which means there will be less of it.
First, you won't be able to get insurance for this case, because it predates your policy. A bit like getting fire insurance when your house is already on fire.
Second, an insurance company won't just write you a blank cheque for legal fees, they will take over the case and look for the cheapest way out, which will probably be settlement.
An insurance company dedicated to patent trolls might have a policy of fighting every case in court. If you have the resources to back up this threat, it means patent trolls are much less likely to actually go to court.
Hence, specific insurance against patent trolls could work by effectively taking away the easy targets for patent trolls.
It's a bit like home-insurance companies that offer discounts on good locks to keep out thieves. Everyone except for the criminals are better off afterwards.
Yes, hence why I pointed out it didn't help in this case (there's already an NPE demanding license fees).
I don't know if the second point is a big deal. Even if they choose to settle, you've still mitigated your risk without going to court. And I suspect a patent litigation insurance agency is going to be motivated to negotiate very small settlements and/or actually fight it out in court, lest they gain a reputation as the company that hands out license fees.
I got a quote from them 2 or 3 years ago for a company and the amount was for $7K/year. RPX said they came up with the price based on the likely danger of patent trolls to this company, so I don't know if the price they would quote now or to another company would be the same.
I noticed the response from Playsaurus' attorney, as well as stating why CH2 is not infringing, lays out arguments suggesting the 838 patent should not be valid.
I'm curious if someone familiar with the matter happens to be reading - is there any provision in the system for Playsaurus to now have the case taken the court regardless of the fact GTX did not infact file a lawsuit, i.e. attempt to have it invalidated even if GTX drop the threat of the lawsuit? Or would they need to piggy back / support one of the other companies listed in this blog?
Yes. They would arguably have standing to bring a declaratory judgment action, asking a court to invalidate the patent. They should also look for (now relatively common) state law provisions that provide damages for bad faith demand letters.
That would be pretty expensive though. Is why nearly any non-huge company is going to take someone dropping their claim as a huge victory, and not try to go to court anyway.
Yes, you can seek a declaratory action in federal court, and more recently, you can seek to invalidate with the USPTO's PTAB through an inter partes review (IPR).
Yes, although with bad result of the other companies negotiating lower fees and throwing the protagonist under the bus. (If I remember correctly) I hope that in real world there would be some legal paperwork ensuring this doesn't happen.
