A Rant, and Some Suggestions What to Do, About Patent Trolls An entrepreneur devoted to innovation and protection of intellectual property lets loose about patent trolls and the patent system that enables them.
By Christopher Seiwald Edited by Dan Bova
Opinions expressed by Entrepreneur contributors are their own.
Patent trolls bear much more similarity to the trolls from Scandinavian folklore than the wide-eyed dolls with colorful Mohawks from the 90s. Literature describes these ancient trolls in PG-13 terms as "unhelpful," and the same can be said about patent trolls and their role in modern society.
Related: Yes, Patent Trolls Are Hurting Your Business
Before I dive into my issue with patent trolls, I should clarify a couple of things. First, as an entrepreneur and founder of a company employing 250+ people, I have great respect for the patent system. It is, in part, responsible for the innovation that's powered our economy for decades. Second, I value intellectual property and an individual's right to protect their work from use by others without permission.
What's the difference between a patent troll and a regular copyright infringement lawsuit? By definition, patent trolls are not entrepreneurs, nor employers, nor do they fuel innovation of any kind. They are "Non-Practicing Entities" (NPEs) or "Patent Assertion Entities" (PAEs), which means that they don't use the patents they own to produce anything. They operate for the sole purpose of extorting money from the companies that do invest in making innovative products and do employ people to make the visions behind the patents come to life.
Isn't this about big tech companies going head-to-head in court? Not really. While cases involving millions of dollars and Fortune 500 companies get the most media attention, patent trolls target startups and small businesses that most. According to a research report from Santa Clara University ("Startups and Patent Trolls"), 55 percent of defendants are businesses with less than $10 million in annual revenue. Patent attorneys charge approximately $500 per hour and patent trolls offer to settle for (a little) less than the cost of a court battle, which is why start-ups and small businesses are a more lucrative target than big companies with armies of lawyers on staff.
Everyone venturing out on their own knows they're taking a risk. Most of them are ready to fail based on the merit of their idea. However, there isn't a single thought more frustrating than knowing that your business could crumble because fighting a patent troll costs more than what you can afford. I know, because my company, Perforce Software, is currently defending itself against a patent troll to the tune of tens of thousands of dollars, in a claim that anyone with an ounce of technical savvy could see is patently (no pun intended) ridiculous.
Related: More Bad News for Patent Trolls
Protecting what is rightfully yours. Despite the financial impact of building a legal defense, we're actually one of the fortunate ones because we know that we'll win our case. How can we be so sure? We have records of every asset that matters to our company—from source code, to legal documents, to multimedia assets—and I can tell you when each asset was first checked in, when a new version was created, who made the changes, if the file was moved, what it had for breakfast and who was its first crush.
Now, you might wonder how I kept such immaculately detailed records for almost 20 years and this is where I have to make a disclaimer. My company specializes in version control software. However, we're not the only company in the market that offers version control, nor has it prevented us from being targeted by patent trolls ourselves.
I speak to you as an entrepreneur who wants to see the end of patent trolling and is eager to share the big lesson learned: track your ideas and your assets as you develop them. These records can invalidate infringement suits and save you thousands of dollars if your business is ever has to battle a patent troll.
Technology patents should be in a league of their own. In the long run, the only way to stop patent trolls from destroying more businesses with worthless accusations is to overhaul the way patents apply to technology.
The first step would be to eliminate traditional patents where claims are filed through a lengthy process and owned for 20 years. Technology should be treated as an "original work of authorship" and granted the same copyright protection as art, music or literature. This would benefit innovation immensely because the costly filing process would be replaced with instant protection. Most importantly, it would put an end to ludicrous claims to patents covering basic concepts rather than unique expressions of those concepts.
The recent case of Oracle v. Google exemplifies the nature of the problem. Oracle claimed that Java's API was subject to copyright, while Google argued fair use based on the broadness of the concept. I wholeheartedly agreed with the first ruling, which stated "So long as the specific code used to implement a method is different, anyone is free under the Copyright Act to write his or her own code to carry out exactly the same function or specification of any methods used in the Java API. It does not matter that the declaration or method header lines are identical."
This verdict was later overturned, which I believe will lead to adverse consequences that will soon be felt across the industry.
Another issue is that the nature of technology is such that innovation is only "innovative' for a short time. The newest-and-greatest becomes ordinary and the next generation of the product sets a new standard. That is all-the more reason to end 20-year technology patents. Instead, grant them patents for only however long they're useful.
That isn't an easy definition to articulate in legal terms but the outdated system we have sets traps for developers who want to expand and iterate on existing technology. That stifles innovation and industry growth.
But in the meantime…It is frustrating as dealing with patents trolls, and just as frustrating waiting for meaningful legislation to be passed and enforced. Nonetheless, we can't let it discourage us from pursuing our passions. America was built on inventions and innovations. We shouldn't let the greedy minority that are patent trolls destroy our spirits and our legacy. To borrow an old adage from across the pond, I say we all keep calm and innovate on.
Related: Entrepreneurs Want Patent Trolls Gone, But Current Legislation Is Sloppy
