Proactive Protection from Patent Trolls

In the final installment of our series on Understanding Patent Trolls, we’ll cover what you can do proactively to defend yourself against assertions.  While no guarantee, being proactive has benefits, and knowledge of the activity in your market is the first step to planning how to deal with it.

The first thing to do is to monitor filings in your technology markets.  The more you understand about trends, and the organizations filing, the more ability you have to protect your interests and take action when necessary.  It’s also necessary to understand the litigation and reexaminations in your markets.  This understanding can, and should, be applied to your R&D efforts.  Actively designing around potential issues to help ensure your novelty is a best practice.

Patent Assertion Entities (PAEs) are generally repeat litigants, so once they appear in your market, they are likely to have multiple cases and remain active for some time.  

The USPTO also has implemented some new appeal procedures as part of the America Invents Act that can provide benefit, but timely action is required. 

The first of these is the Post-Grant Review (PGR).  Within nine months of patent grant, anyone can request review on the grounds that at least one of the claims in not novel, or there is an unsettled legal question important to related patents. 

The next possible action is a reexamination of Covered Business Methods (CBM).  This action cannot be requested until an infringement has been charged.  The standard in this instance is that at least one claim is unpatentable.

Finally, an Inter partes review (IPR) can be requested within 9 months of issuance or within one year of service.  In this situation, the appeal board will be looking to see if at least one of the claims is unpatentable. 

All of these actions require vigilance in monitoring filings and grants.  There is also cost involved, but that is certainly far less than any downstream litigation.

The benefits of these new PTO actions are that they move along faster than the court process, the standards rely on a preponderance of evidence, decision-makers are versed in the technology in question and the decisions are not appealable.

Another proactive measure is to monitor patent assignments in your market to understand what PAEs are buying.  For example, you’d start with your own portfolio and examine the patents that are forward cited.  From that list, sort the patents by assignments.  Finally, watch how these assignments increase in numbers over time, and this will provide clues about the PAEs that are about to become active in your space.  It pays to understand related patents that are up for sale, and proactively acquire them if that makes financial sense.  Identify the brokers that specialize in your market, and stay in touch regarding the IP that is for sale.  Larger portfolio holders may find value in joining a consortium to protect themselves from PAEs. 

Finally, you can obtain insurance to protect your IP.  There are policies available for to protect a variety of situations, including infringements against your IP, defense costs if you receive an assertion, warranties for IP that you acquire and security to protect an asset used as loan collateral.  Premiums are expensive, but this may be a worthwhile investment in very litigious markets.  Insurance, however, should be the last step in proactive protection of your assets – after you take the steps to avoid litigation by designing around existing IP, obtaining indemnity from suppliers and partners, monitor filings, grants and assignments, and budget for defense costs.

For more content on this, and other IP topics, see our recorded webinars and white papers.

Have any other techniques you use to proactively protect your organization from trolls? Share them in the comments section below.

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