It was several moths ago that we wrote about Rackspace in relation to patent trolls. Here is something we found in the press;
Open cloud company Rackspace has appointed an open source industry guru to its VP of intellectual property position.
And now a return to a favorite topic here at AVC - patents, patent trolls, and the urgent need for patent reform here in the US. One of my favorite ideas for sensible patent reform is "loser pays" for the legal costs of the other side. The reality is that patent trolling is a low cost form of shakedown and that there isn't much economic cost on the troll to deter this behavior. If challenged in court, patent trolls win less than 25% of the time. And yet so few of these shakedowns ever go to court because the cases get settled for economic reasons (settlement cost are less than expected defense costs). And these settlements fund the trolls to keep shaking companies down. If the target company can recover their legal costs by defending themselves and winning, then the math over the settlement changes and more cases will be litigated, thus increasing the costs for the trolls.
STANDARD-ESSENTIAL PATENTS IN CONTEXT: JUST A SMALL PIECE OF THE SMARTPHONE WAR PUZZLE
The crux of the debate centers on how much flexibility SEP holders have to negotiate licensing terms for their patents that are promised to be licensed under “(fair) reasonable and non-discriminatory” terms (FRAND or RAND). Specifically, the debate focuses on this question: when is it appropriate to enjoin infringing products from the market if licensing negotiations break down? Historically, FRAND commitments have been relatively ambiguous, giving those holding SEPs broad (but not unlimited) flexibility to negotiate “reasonable” bilateral deals. Currently, there is a movement afoot to give SEP holders less negotiating flexibility. This will have both positive and negative consequences.