08.21.15

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Who’s Obsessing Over Patent Trolls in Latest ‘Reform’ Efforts? Larger Patent Trolls Such as Xerox

Posted in Patents at 2:12 pm by Dr. Roy Schestowitz

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Summary: Response to claims that the patent problem is being tackled by focusing on patent trolls and their favourite courts in the Eastern District of Texas

TECHRIGHTS has consistently (over the course of several years) opposed the obsession with “patent trolls”. The de facto usage of the term implies small firms without products, but in reality a lot of the same tactics are used by multinational companies such as Microsoft. The only difference is the number of products advertised on their sites (if any exist at all).

The other day the EFF said that “[w]e Need Venue Reform to Restore Fairness to Patent Litigation”, citing a TV programme about the issue of patent trolls, not patent scope or anything like that. To quote the EFF: “Back in 2011, This American Life toured an office building in Marshall, Texas, and found eerie hallways of empty offices that serve as the ‘headquarters’ of patent trolls. For many, that was the first introduction to the strange world of the Eastern District of Texas, its outsized role in patent litigation and especially its effective support of the patent troll business model. Trolls love the Eastern District for its plaintiff-friendly rules, so they set up paper corporations in the district as an excuse to file suit there. Meanwhile, defendants find themselves dragged to a distant, inconvenient, and expensive forum that often has little or no connection to the dispute.

“The remote district’s role has only increased since 2011 The latest data reveals that the Eastern District of Texas is headed to a record year. An astonishing 1,387 patent cases were filed there in the first half of 2015. This was 44.4% of all patent cases nationwide. And almost all of this growth is fueled by patent trolls.”

But that’s far from the only issue.

An article by Joe Mullin, who specialises in patent trolls, says that “changes to patent law have made it easier to beat patent trolls, but it hasn’t made the patent hotspot of East Texas any quieter. In fact, it’s been in the news more. Massive numbers of patent troll suits continue to be filed there, and the judge who hears most of them has erected barriers to defendants seeking to have their cases disposed of early.”

So it’s obviously not working out. This whole kind of activism (or corporate lobbying) does nothing to eliminate the core issues, mostly addressed by SCOTUS for the time being (more on that in a later post).

Xerox, itself a patent troll by extension, is claimed to have just beaten a patent troll, MPHJ [1, 2, 3, 4]. To quote a lawyers’ site, “Xerox Corp., Lexmark Corp. and Ricoh Americas Corp. won their bid to undo a so-called patent troll’s patent for document scanning Wednesday when the Patent Trial and Appeals Board ruled eight of the invention’s claims unpatentable.

“Nonpracticing entity MPHJ Technology Investments LLC, once called a “patent troll” by Vermont’s attorney general, was unable to persuade the board that the claims in its patent didn’t just combine decades-old prior art, according to a decision handed down by PTAB.”

It is so strange to see Xerox among the defendants here because Xerox itself has become a troll. ~100 Novell employees ended up working for Xerox after Fuji Xerox signed an early patent deal with Microsoft (involving Linux). Xerox now uses proxies to act as its own private patent trolls. Remember when the Microsoft-connected Acacia attacked Linux using Xerox patents (5,276,785 and 5,675,819)?

If spurious litigation (not just “patent trolls”) is what we’re seeking to combat, then we ought to look beyond the scope defined by large conglomerates with an army of lobbyists. Contrary to common belief, Xerox is not a dead company as it still enjoys an annual revenue of $26.58 billion.

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