I recently had the opportunity to speak during Northwestern University’s Journal of Technology and Intellectual Property Annual Symposium. The one-day event, held at University’s Law School, addressed current hot topics in the industry, including gene patenting and innovation economics.
My panel, which also featured speakers Jay Kesan of the University of Illinois at Urbana-Champaign, Neill Taylor of Round Rock Research, Laura Beth Miller of Brinks Gilson, and Andrew Williams of McDonnell Boehnen Hulbert & Berghoff, focused on patent aggregators and non-practicing entities (NPEs). The ensuing conversation confirmed the industry’s general lack of consensus in both clearly defining the patent troll “problem” and devising effective strategies for reform.
In my opening comments, I sought to describe the state of play in the industry. My main takeaways for the audience included:
Not every non-operating company that asserts its IP is a bad actor. There are bad actors on both sides of the licensing equation.
Patent trolls are bad. They create an unfair and inefficient tax system, often assert poor quality patents at the litigation indifference point to extract rents and do not spur innovation— the sine qua non of the patent system.
Current rhetoric, including the White House’s position on patent reform, has become unbalanced in favor of licensees, suggests an identity between “Trolls” and “PAEs,” makes no mention of fair compensation for innovation and makes no mention of hold out licensees.
More so, the non-IP public and the media often fail to distinguish technology development entities who, from time to time, are forced to defend their interests through litigation, from mercenary “patent trolls” who use litigation as a mean of production. I delineate the full spectrum of IP Holders from IP Development and Commercialization Entities to Pure Trolls in my presentation.
All parties, other than pure patent trolls, make legitimate contributions to the IP Ecosystem.
The failure of the legislative, judicial and administrative quarters to distinguish among patent assertion entities has resulted in what I call the “Great Conflagration.” Ultimately, the “all assertion is bad” argument is confusing and is anti-innovation.
This panel was just a small part of a much larger dialogue regarding patent aggregators and NPEs’ effect on the industry and our nation’s innovation output. Ocean Tomo remains involved in that conversation.
If you are interested in receiving a copy of the presentation, please contact me (email below).