Friday, 31 January 2014

An Important Webinar: Are Patent Assertion Entities Responsible for the Rise in Patent Suits?

Neil Wilkof in a recent post, What are we to make of the Defensive Patent License?, raises excellent questions about the supposed problem of patent trolls and their impact on innovation.  In a recent paper, Professors Christopher Cotropia, Jay Kesan and David Schwartz, carefully study some aspects of the “Patent Assertion Entity.”  The abstract of their paper, Patent Assertion Entities (PAEs) Under the Microscope: An Empirical Investigation of Patent Holders as Litigants, states:

There is tremendous interest in a certain type of patent litigant — the often-called non-practicing entity ("NPE"), patent assertion entity ("PAE"), patent monetization entity ("PME"), or simply patent troll. These NPEs are the subject of a recent GAO report, a possible FTC investigation, pending legislation before Congress, and even comments from the President of the United States. All of this commentary and activity centers on whether NPE participation in patent litigation, and the patent system in general, is detrimental or beneficial to society. But the fundamental barrier to understanding the current debate is the lack of granular and transparent data on NPE litigation behavior.

Accordingly, we personally hand-coded all patent holder litigants from calendar years 2010 and 2012, and we are releasing this data to the public. In our coding, we drill down and finely classify the nature of the litigants beyond the simple NPE or non-NPE definitions. Releasing this data to the public that unpacks the definition of NPE can provide better illumination to policy makers, researchers, and others interested in the patent litigation system.

The data reveals a much lower percentage of litigation brought by patent holding companies than other studies, finding no explosion in NPE litigation between 2010 and 2012. Instead, we find that most differences between the years — an increase in the number of patent holding companies and individual inventor suits — is likely explained by a change in the joinder rules adopted in 2011 as part of the America Invents Act.

The paper also has an accompanying website, where the data is available:

On Thursday, February 6, 2014, from 12:00 pm – 1:00 pm (US Eastern Time), The Patent Litigation Committee of the Federal Circuit Bar Association is sponsoring a panel, Are Patent Assertion Entities Responsible for the Rise in Patent Suits, featuring the authors of the study as well as David Kappos, Partner at Cravath, Swaine & Moore, and former Director of the United States Patent and Trademark Office.  The moderator is Eric Cohen, Partner at Katten Muchin Rosenman. The description of the panel states:

Proponents of proposed patent reform legislation have assumed that there has been a dramatic recent increase in patent infringement actions filed by patent assertion entities (“PAEs”), also pejoratively referred to as ‘patent trolls.’ A study by professors Cotropia, Kesan, and Schwartz of patent infringement data refutes this assumption. In this program, the authors of the study and David Kappos, former director of the United States Patent & Trademark Office, explore whether there has, in fact, been an upsurge in patent infringement cases filed by PAEs, and whether the data from the study suggests a more cautious approach to legislation that would affect the manner in which courts manage patent litigation.  (emphasis added).

Additional information about the panel, including registration details, can be found here.

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