Are these patent trolls doing anything that normal companies with patents that try to monetize them don't do?
if a company doesn't develop products, but they actively license their patents to those that do, that's still patents working as intended, and not trolling. they're still helping to get the tech developed, rather than stifling it
(i think there are a lot of problems with software patents even when used as intended by real companies. mainly, they last too long)
Software patents are a scourge, I’m just not sure the reasoning there holds.
The reason is because they aren't being used as they were intended: patents are _supposed_ to be a way to give inventors/entrepreneurs a window to build a market with their idea. Let's say that you have some truly amazing invention that frobnicates foos 50x faster than anyone else, and you plan to take it to market. What would prevent the likes of Amazon from copying your idea with all the resources at their disposal? Patents.
Patents as an asset is exactly the problem. Your entire first paragraph is built on this faulted perspective - the assumption that how we actually use patents is aligned with how they were designed to be used. They are supposed to foster small businesses, not destroy them.
Software patents are a scourge only because patents as a whole have become a scourge.
If I invent something, I should surely be able to license its production if I don’t want to be in the production game myself. The alternative reduces to the absurd very quickly. If I invent a better system for making ball bearings, it’s not reasonable to say I should only benefit from it if I then personally raise the capital and experience to start a ball bearing manufacturing plant.
If you invent a better system for making ball bearings and patent it, you could bring your system to existing manufacturers and say "I've invented a better system, would you like to license my patent and start using it to bring your costs down and productivity up?" That's fine and most people would be on board.
But a patent troll is different. They're entirely reactive. They wait for someone else to start doing something that is vaguely similar to what you patented, and then they pounce. The troll threatens legal action if they don't license the patent instead.
What patent trolls do is effectively extortion.
That line of thinking is the problem. A patent is intended as a protection to spur development, not an asset to be traded.
The spirit of a patent is to protect a novel solution while a company develops and monetizes their innovation. It keeps bigger fish with deeper pockets from quickly copying your invention and monetizing it before you.
What's happened however is that Large companies with deep pockets are filing patents for anything and everything they can. These patents generally come from their R&D efforts but are not necessarily linked to any product specifically. They're also usually unenforceable junk that wouldn't hold up in court.
The value of these junk patents isn't in the viability to be developed into a product, rather their value is that it will take time and money to invalidate them in court.
When these companies are hit with a lawsuit for violating someone else's patent, their defense is to counter sue with as many junk patents as possible. The purpose of the counter suit is to make a settlement preferable to the protracted legal fight necessary to invalidate all of the junk patents. It's the path of least expense. You could argue this allows large companies to steal innovations from smaller players by forcing cross licensing agreements.
Often these patent portfolios are transferred to companies with no interest in developing products or protecting their business. These companies sole purpose are to weaponize the patents, they're Patent Trolls.
Using the same strategy as companies with defensive patent portfolios, Patent Trolls seek to extract settlements (extort money) from companies by suing them with all the junk patents they can. The patent trolls are immune to counter suit because they produce nothing. Thus companies must either invalidate each junk patent or settle. Often settling is the path of least expense.
The issue is widespread bad behavior from patent trolls, given that the cost of mass filing patent infringement claims that barely apply is so much lower than the expected settlement, and the cost of a successful defense is likely higher than the request settlement. The incentive is to get a portfolio of overly broad patents and then shake down almost entirely unrelated companies.
if a company sells it to a broker, and it eventually gets traded or licensed to a company that develops it, i'd also consider that working as intended
if patents keep finding their way to companies that have no intention to either develop it themselves, or license it to others, and keep suing companies that do develop things, i'd consider it a failure of the system
pharma patents get traded to non-developers all the time, but pharma patents mostly do their job of incentivizing innovation. there's still flaws, but the troll problem isn't a big issue in that space
The companies that are doing the suing here are — as I understand it here — are suing to force a licensing deal.
the (forced) licensing deal comes after the development, and hinders it. and it's not to protect development of a related idea, either
1. Patent trolls don't actually produce anything. They just extract rent from other companies.
2. The patents they choose tend to be extremely bad -- overly broad, should never have been granted, had prior art, the tech never existed, .... They use the fact that they're able to sue cheaply to bully people into settling on bogus claims.
Point (1) doesn't seem bad to me. It's kind of like how truck driving is separate from truck insurance. Having specialists capable of monetizing patents allows, in theory, inventors to invent and immediately sell for estimated lifetime patent value, minus a discount associated with the troll's costs and desired profits. Without trolls, in theory, you'd have fewer inventors because they'd also need to be/hire experts in marketing, litigation, ....
Point (2) is the one that bothers me the most, and my impression is that it's a very common problem.
Oh, and to your question, most companies use patents for mutually assured destruction and as a form of signalling that important people should want to work there, not to directly monetize. Monetizing patents is less common.
Another argument against your argument in (1), is to allow the scenario to exist only where the purchaser of the patent can prove they are marketing and selling it. That is still not ideal imho, but at least it eliminates outright patent trolls.
HN is I think particularly sensitive because it has a lot of programmers and product development folks, who know that a good idea or even plan on its own isn't very valuable. I'd guess most of us have more good ideas floating around than we'll ever have the time or money to develop on our own. Its the execution and delivery of good ideas that is valuable; patents in our eyes make the easy part easier and the hard part harder.
Valid patents have to work (couldn't patent transistors in 1820), be new (which, as you mention, isn't the hard part in turning ideas into value), _be non-obvious_ (this is the point that pushes your idea from (1) to (2); if somebody else were likely to spontaneously have the idea then it wasn't a valid patent to begin with, and if they weren't then the "additional tax" is a tax on a product they otherwise could never have made), and include clear instructions (from the patent, reasonable competitors ought to be able to instantiate the idea -- if they can't, it's yet again invalid).
I do like what you're getting at though; the goal is to encourage actual inventions to actually be used. The patent mechanism attempts to do so by granting temporary monopolies (even with no real value via trolls), then guaranteeing that the invention is available for use afterward. You might be able to come up with another legislative mechanism encouraging real use of the patent before its expiry, and if it actually worked that'd probably be a good thing.
The important distinction here, in my opinion, is that investors bought a dead company along with it's IP for the explicit purpose of suing companies as that was their profit motive.
Had there been an existing company that was actively building/selling routers, then yes they would have been using the patents as intended - to protect their business. In this case the company who owns the patents, was using them in a weaponized fashion.