Cloudflare is like Google early days. They could spend resources on things for the good of the all. In this case they’re spending millions when they could have settled for much cheaper. Thanks Cloudflare.
If they settled the trolls would just keep coming.
If they fight the patent extortion then trolls are going to think twice before suing them, for fear of losing .
They were also getting sued regularly, by patent trolls.
They had really good lawyers, and had a basic policy, to never settle with trolls. It wasn't altruistic. They just didn't want to get bullied. I'm sure that they also went after other companies, and there was probably a lot of wheeling and dealing. That's one of the reasons that corporations like to hoard patents.
They used to require their engineers to file a couple of patents a year. I am on a patent. I got a dollar for it.
It's likely that over the lifetime of the patent, the total cost would have been more than the cost to fight it, and as the a sibling pointed out, settling begets more suits + settlements. It adds up fast.
This isn't Cloudflare being "good," it's in their best interest to fight frivolous suits.