Are Patent Trolls the New Justin Biebers of Corporate America?

Are Patent Trolls the New Justin Biebers of Corporate America?

Teenage girls like to dream about adolescent pop star Justin Bieber. Much like Justin, patent trolls might be turning into the hunky dreamboats of swooning corporations.

According to a recent Wall Street Journal (WSJ) article, some tech corporations are creating patent entities for the sole purpose of licensing and litigation. And if not their own patent entities, then some are selling patents to independent, nonpracticing entities (i.e., patent trolls).

The article mentions Apple, Microsoft, Research In Motion, Ericsson and Sony, which last year purchased a number of patents from Nortel's bankruptcy. The companies then created Rockstar Consortium, which owns a portfolio of approximately 4,000 patents related to networking, communications and internet technologies. In its March 12th press release, Rockstar said it is:

set to implement its plans to pursue licensing agreements with companies that are harnessing its intellectual property.                            

The WSJ article underscores the 10-year maturation of the "NPE industry," which seems to suggest the growing legitimacy of nonpracticing entities. However, in a study cited by the Atlantic, the litigation costs of this "industry" is set at:

$29 billion in 2011 alone, and that's just the direct legal costs, not even counting "various indirect costs ... such as diversion of resources, delays in new products, and loss of market share." The loss for the economy overall -- in terms of immeasurable opportunities -- is surely far greater.

Here, nonpracticing entities are described as "predatory" and parasites.

Whatever the state of the "industry," the debate still remains: Are nonpracticing entities ugly patent trolls, or are they trendy patent Biebers? 


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