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Congress Should Address Patent Trolls

So, if you hold a patent and you think someone is violating it, you file a lawsuit.

So, if you hold a patent and you think someone is violating it, you file a lawsuit.

You point out in your lawsuit which patent you think was violated and how and by whom, as well as who exactly would benefit if you prevail. The loser pays both attorneys, you go after manufacturers before users and you don‚??t force discovery on either side until the court can look up the patent and weed out cases where the verdict is obvious.

Actually, aside from the filing the lawsuit part, none of that is true. It would be if Congress passed the PATENT Act, legislation from House Judiciary Committee Chairman Bob Goodlatte, R-Va., that seeks to limit patent trolling and bring some order and predictability to the patent enforcement process.

The House passed a version of the bill, which the White House supported, in 2014, but the Senate never acted on it. But last week, the measure passed the Senate Judiciary Committee with bipartisan support and is expected to pass the full Senate and be signed by President Obama.

Proving, yet again, that no good deed goes unpunished, companies are seeking to assert patents that represent little or no actual invention. And they are doing it a feverish pitch to extract maximum profit before the law passes.

For instance, there is a company in Dallas known as Securus that has a patent on phone systems to serve prisons. What makes a phone system for a prison different from a phone system for a company that had more or less the same level of security needs?

Who knows? But people are starting to ask.

Securus is accused of being a patent troll ‚?? a company that asserts patent claims, such as that prison phones are somehow different from office phones in ways conjured by Securus, then sues to enforce them knowing most companies will pay up rather than endure an expensive court fight. Frustration with this practice ‚?? it clogs the courts, bleeds competitors and puts a drag on the economy ‚?? has enabled the PATENT Act to move toward passage with bipartisan support.

Securus has filed 12 lawsuits against 19 competitors in the last decade, most of which have resulted in settlements by companies that considered it cheaper to pay up than litigate. But one, Global Tel*Link Corporation, has decided to fight back.

The firm has begun to file petitions against Securus‚?? patents with the Patent Trial and Appeals Board. It claims Securus‚?? patents ‚??mimic available consumer products, like Apple‚??s FaceTime, and a ‚??range of other technology‚?? that was well known long before Securus‚?? patent applications were filed.‚?Ě

Global Tel*Link contends Securus files duplicative patents with minor changes, obtains patents covering technologies already in the public domain and patented by others and secured patents without inventing any new technology.

It says the Securus‚?? actions amount to it placing a cost-of-doing business tax on the rest of the industry and ‚??seeks to expose these patients for what they are ‚?? a collection of ideas and inventions that others thought of first and which Securus wrongly claimed as their own.‚?Ě

The Patent Trial and Appeals Board already has said there is a ‚??reasonable likelihood‚?Ě GTL will prevail in all 146 of the claims it has made against Securus.

Things are not good for Securus. Prison spending is down, and in part to Ferguson and in part to the outrage over civil asset forfeiture, under heightened scrutiny. This avenue of income ‚?? the value of its current lawsuits has been estimated at up to $60 million ‚?? is under attack from Congress. Bad publicity over the patent troll accusations, the court battles and the likely losses at the PTAB could lead the states, counties and municipalities with which it does business to become leery. And predictably, its bid to increase its debt level has led to hesitation by investors.

But it‚??s hard to generate much sympathy. Two-thirds of the patent-related cases in U.S. courts right now are said to be troll-related, up from 28 percent five years ago. Overall, monetary awards on patent lawsuits are decreasing slightly, but trolls are filing more suits and making more money than ever before.

The discovery process itself‚??especially with Securus, which deals with prison matters, security plans, personal information of inmates and employees, etc.‚??has been called a privacy advocate‚??s nightmare. Sen. Charles Schumer, D-N.Y., calls patent trolls ‚??tapeworms on the body politic.‚?Ě

We all recognize the need for legitimate patent enforcement. And increasingly, we recognize some have found a way to pervert the law to their own financial gain. We need the system to work, particularly in this day of a truly global economy. We need people and companies to operate in good faith when asserting or defending their property rights.

And when we are confronted with obvious cases of this not happening, we need recourse.

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