Business of Law

Tool against ‘trolls’

Posted Mar 1, 2009 9:00 PM CST
By Richard Acello

Illustration by Christoph Niemann

Bothered by “patent trolls,” those pesky creatures who wait for inventions to hit the market and then cry, “I’ve got your patent; now pay me”? John Amster says he has a solution.

Amster, an intellectual property lawyer, is a co-founder of RPX Corp. in San Fran­cisco, which buys up patents. For a fee, subscribers get access to all the patents in its portfolio.

“We provide a patent-defense aggregation service,” he says. “We buy a significant volume of patent rights, either actual or potential threats to companies that will be our members. ... [Members] get a license to everything in our aggregation.”

RPX, open for business since September, boasts IBM, Cisco Systems and Epson as clients.

How does RPX know which pa­tents are relevant to clients? “If something’s on the market being shopped by patent brokers and they come to us with a write-up of why your products are infringing on it, that’s a pretty good indication,” Amster says.

In January the firm entered a license agreement with patent port­folio holder Acacia Research Corp. RPX said some defendants in a pa­tent suit Acacia filed could get out of the suit by signing up with RPX.

The cost of membership depends, Amster says, on a company’s revenue.

Scott C. Harris, an intellectual property lawyer in Rancho Santa Fe, Calif., says RPX’s business model may have legs.

“RPX is approaching the non­practicing entity issue from a new angle,” Harris says. “Overall, this [approach] can reduce the costs to companies caused by their infringement of patents of others. If the model can work, it’s a win-win.”

Comments

1.

Keep Them Dogies Trollin'
Feb 25, 2009 4:49 AM CST

Seriously?  This is the solution? 

“Want to get away from those pesky trolls?  Sign on with this Uber-Troll!”

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2.

Concerned Patent Attorney
Feb 25, 2009 5:53 AM CST

I read this article, and re-read it. I still don’t understand how obtaining patent rights can be used as defense against a non-practicing entity.
Can anyone elucidate?

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3.

IP Attorney
Feb 25, 2009 6:25 AM CST

I would assume that this model works only if the “troll” has licensed its patent to RPX, in a manner that would allow a future defendant to join RPX and thereafter be covered by the license. I am not sure why a “troll” would do that, at least after the first time. What am I missing?

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4.

gea
Feb 25, 2009 6:36 AM CST

I, too, had to reread the headline and article to make sense of it. The only thing I can think of is that instead of having some uncivilized person asking for a whole bunch of money and litigating forever, instead you get civilzed RPX who will engage with you by licensing that unknown patent for you. That way, they have done all the work for you beforehand and you avoid expensive litigation fees and unknown trolls in the forest popping up years later.

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5.

Steve Perkins
Feb 25, 2009 7:11 AM CST

I, three, had to re-read the headline and article and all the comment to make heads or tails of this.  I reached the conclusion that Comment #1 summed up the story quite well.

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6.

Paul F. Morgan
Feb 25, 2009 8:10 AM CST

Yes, this way the troll or other patent owner gets a large payment up front for the assignment of the patent with no litigation.  That way no one who is particiipating will have any incentive to challenge the invalidity of the patent in litigation, or by reexamination, so the invalid patent can keep on being asserted against the rest of the public.

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7.

R
Feb 25, 2009 12:43 PM CST

As a Norwegian-American, I take deep offense at the the proud word “trolls” being used to describe (ugh) patent lawyers.

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8.

Jeff
Feb 25, 2009 1:20 PM CST

Hey I have a anti-car theft device that works too. We set-up an appointment with the vehicle owner (at their convience of course) and with the owners permission we will drive away with their vehicle and when that so called car thief shows up to take the vehicle…..its not their, there for your vehicle will never get stolen and you will never have to go through that “oh my god, where’s my car feeling ,”...!!!  see…yah…yah thats it.  I think their on to something….. j/k

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9.

Vince
Feb 25, 2009 2:07 PM CST

“If something’s on the market being shopped by patent brokers and they come to us with a write-up of why your products are infringing on it, that’s a pretty good indication,” Amster says.

Query, why would the patent owner sell to RPX for less than it could get by suing the alleged infringers?

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10.

Mario
Feb 25, 2009 2:16 PM CST

Its very nice that RPX will be buying up all the patent rights owned by trolls so that they cannot sue actual companies.  Why, then would anyone need to get a license from RPX UNLESS RPX now steps into the shoes of ALL the trolls, and thus becomes, as mentioned above, the uber-troll.  Why would anybody pay RPX unless they themselves start threatening patent infringement litigation?

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11.

Everett
Feb 26, 2009 8:23 AM CST

Why do so many people denigrate inventors for wanting to profit from their inventions?  Are law firms so in love with big business that anyone outside that model is a “troll”?  I have a dozen patents in various fields, and the net savings to society has been in the nine figures.  Why should I have to start a new manufacturing company just because I have created a new product?  Let the inventors invent, let the manufacturers manufacture, and let the patent system provide an incentive for the former to continue feeding innovations to the later. 

I do not want to sue anyone, I just want enough return on my effort so that I can afford to come up with the next invention.  If I can simply sell patents to a single entity such as RPX, I can spend less time selling and more time inventing.

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12.

Nick
Mar 5, 2009 7:06 PM CST

#11 is the only reason I can see that a troll would come to RPX, because it could collect money without suing anyone.  But RPX sure isn’t going to COLLECT any money from anyone without first suing, or at least threatening to sue, someone. 

As a side note, as a patent attorney American, I take deep offense at the proud word “trolls” being used to describe a (ugh) Norwegian!

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