Patent troll litigation totaled $29 billion in 2011, sidetracks innovation

By on June 27, 2012, 12:00 PM

A new study from Boston University reveals that non-practicing entities, otherwise known as patent trolls, cost the US $29 billion in 2011. Monetary damages aside, the study found that the increasing number of lawsuits is curbing innovation among small and medium-sized companies.

A patent troll can be described as an individual or company that acquires patents and licenses out their use or simply sits on them without intent to manufacture a product using them. Some say that Nathan Myhrvold, the founder and CEO of Intellectual Ventures, is a prime example of a patent troll. His company’s sole mission is to buy and license patents, although he has argued that Apple, Google and Samsung are now doing the exact same thing he is.

The authors of the study note that it’s usually small and medium-sized businesses that are most affected by patent trolling, as they are required to redirect funds from innovative research and development to purchase what can be described as vague and overly broad patents in an attempt to cover all the bases.

Despite what Myhrvold and others might say, the study found very little evidence that non-practicing entities contributed to innovation or invention. Instead, publically traded companies like this cost businesses more money than they could ever hope to transfer to inventors. Furthermore, a large portion of lawsuits ultimately settle for a couple hundred thousand dollars which doesn’t amount to much more than a nuisance for the average medium-sized company.

The authors believe that those in charge should reform the patent system, making it more like an idealized property system and address patent troll behavior.




User Comments: 12

Got something to say? Post a comment
wiyosaya said:

With any luck, more and more entities will start calling for US patent reform on the basis that patent trolling stifles innovation.

Guest said:

I should patent patent trolling and charge other trolls for trolling.

Staff
Rick Rick, TechSpot Staff, said:

I should patent patent trolling and charge other trolls for trolling.

It appears you have created a new frontier for trolls: meta trolling.

Khanonate said:

My level 60 Demon Hunter will take care of those trolls!

Ranger1st Ranger1st said:

..and this is why more and more ventures are heading off shore and the patent system won't change as long as big business has it's hands in politics.

ramonsterns said:

No guys, it's piracy. They're killing the industry!

Oh wait, wrong industry.

foreverzero89 said:

could've cured hunger world wide for more than 4 years.

ramonsterns said:

could've cured hunger world wide for more than 4 years.

You mean for two months.

Frankly, I'd rather fund the colonization of Mars than feed the poor which will only end up asking for more.

foreverzero89 said:

could've cured hunger world wide for more than 4 years.

You mean for two months.

Frankly, I'd rather fund the colonization of Mars than feed the poor which will only end up asking for more.

no, it'll take only about 8 billion a year to feed the hungry.

ramonsterns said:

no, it'll take only about 8 billion a year to feed the hungry.

8 billion a year down the drain and the second you stop it for whatever reason, you'll be villanized and hated for several decades.

But don't let that stop you, please feel free to start at any time.

foreverzero89 said:

no, it'll take only about 8 billion a year to feed the hungry.

8 billion a year down the drain and the second you stop it for whatever reason, you'll be villanized and hated for several decades.

But don't let that stop you, please feel free to start at any time.

ah my bad, I got the figures wrong, it's only about a year. guess how much the world spend on it's military every eight days? thats right, about 29 billion. feeding the hungry is "down the drain"? in what twisted world do live in. im sure that anyone being fed by this wouldn't agree with you.

TJGeezer said:

Plus, colonizing Mars would give U.S. people a great way to get away from the looters now running their government. The patent and copyright trolls are just playing the same games in a smaller way that corporations play when buying politicians. It's about looting, not about contributing or even, for that matter, actually earning anything.

Load all comments...

Add New Comment

TechSpot Members
Login or sign up for free,
it takes about 30 seconds.
You may also...
Get complete access to the TechSpot community. Join thousands of technology enthusiasts that contribute and share knowledge in our forum. Get a private inbox, upload your own photo gallery and more.