The Harmful Impact of Patent Trolls

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The Harmful Impact of Patent Trolls

By Fatty Fish - March 1, 2023

According to the Electronic Frontier Federation, in the first three quarters of 2022, 64% of all patent lawsuits were filed by patent trolls, and in the high-tech space, patent trolls filed 88% of all lawsuits. A patent troll is a person or business that buys patents from other companies, files lawsuits against other businesses to blame them for patent infringement, and then profits from the lawsuit instead of producing its own goods or services. Patent trolls are dangerous because they can cause a company to file for bankruptcy while fighting a patent infringement lawsuit in court or lead to financial problems while paying costly licensing fees to patent trolls. Here are a series of opinion pieces we found of interest relating to the impact of patent trolls on medical devices, intellectual property, and the 2022 patent troll in review.

Medical Devices

In an opinion piece for MEDTECHDIVE “Patent trolls’ destructive lawsuits are curbing US MedTech innovation,” former HHS Secretary Tom Price, discusses the impact that patent infringement litigation brought by patent trolls has had on the MedTech industry, and shares his thoughts on how these legal challenges prevent the development and implementation of new, promising healthcare technologies. Some experts are predicting the patent litigation battleground is moving away from mechanical devices toward litigation around medtech inventions that rely heavily on software implementation.

Medical devices are particularly susceptible to patent trolling with their collective dependence on advances in not only software, but also hardware, and an influx of investment in the industry which, when combined with the influx of investment into the industry, make medical devices appealing targets. If you’re interested in the challenges patent trolls present to the MedTech industry, read the full article on MEDTECHDIVE.

Intellectual Property Rights

Writing for Bloomberg Law, Paul Stewart, Founder and Managing Director of PASCO Ventures, writes an opinion piece “Hostile IP Environment for Inventors Could Hamper US Innovation” about the impact of patent trolls on intellectual property rights and innovation. In the article, Stewart discusses how efficient infringement, abuse of the America Invents Act (AIA), and the targeted attack on two critical laws — the Bayh-Dole Act of 1980 and 28 US Code Section 1498 are undermining innovation. Read the full article on Bloomberg Law.

Patent Trolls — 2022 in Review

Joe Mullins, a policy analyst at Electronic Frontier Foundation (EFF), examines the work that EFF has done regarding patent trolls. He points out that the introduction of inter partes review (IPR), and the 2014 Alice v. CLS Bank Supreme Court ruling have been good steps to improve the patent system. He also opines that he believes the Alice precedent, which is more than 8 years old now, has done a good job of knocking out many software patents that should never have been issued in the first place.

Mullins also shares that federal courts are increasingly demanding more disclosure in patent cases, including disclosures about litigation funding, which is good as patent trolls prefer secrecy. Read more from Electronic Frontier Foundation.

Disclosure: Fatty Fish is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.