Tuesday, September 29, 2020

Trolls, Submarines and Patent Infringement

Law
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The term patent troll has entered the vernacular to identify companies that acquire and enforce patent rights but neither make products nor provide services covered by those patents. While inventors like Thomas Edison are heroes in our history books no such accolades have been given to Jerome Lemelson, who has been referred to as the father of patent trolls.

A brilliant and most prolific inventor Lemelson obtained over 600 patents earning over $1.5 billion dollars from licensing and lawsuits without ever making a product or providing a service. Some see this as patently unfair while others, usually independent inventors see him as an honored role model.

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According to the U.S. Constitution, “The Congress shall have the power … to promote the progress of science and useful arts by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.” The trade is to grant a limited monopoly to the inventor in return for inventions that advance science and benefit society. For that reason is seems unfair to some when patent owners provide no product or service yet benefit from their patents by suing companies that are already providing the scientific advance to society.

Exacerbating the problem was the frequent practice of submarining patent applications. Because pending applications can be kept from the public, an inventor can delay issuance of a patent by arguing for ever broader coverage and then filing continuation applications and appeals to keep the application pending and hidden for years. Once there are companies practicing the new technology the patent owner reaches agreement with the patent office and issues the patent with claims covering the new technology and asserts the new patent against the unsuspecting infringers.

One of the most egregious examples involved a lawsuit by Lemelson against Symbols Techs. The patent in question was first filed in 1954 and was finally issued in 1994. In 2002, the U.S. Court of Appeals for the Federal Circuit barred enforcement of the patent claims against Symbols for an inequitable delay known as prosecution history laches. Nevertheless, in other cases a delay in excess of 10 years was found to be reasonable.

Whether you are facing trolls, submarined patents or just honest patent holders there are several things that should be considered to help avoid costly patent infringement claims:

PREVENTION: Perform an infringement search or, if done early enough, a “state of the art” search to see whether your new product is likely to infringe anyone else’s patent rights.

IP INSURANCE: Frivolous patent infringement suits have become so common that some insurance companies offer policies to help protect businesses from patent litigation.

MAINTAIN IP: Ensure patents, trademarks and copyrights are current and identify any areas of concern for management.

If you receive notification of a patent lawsuit or a letter demanding payment, consult an IP attorney before you do anything. If you have any questions or want more information, feel free to call us.


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