SHIELD Against Patent Trolls | Article 3

Can the SHIELD Act help fight against Patent Trolls?

I first heard about the costly problems of the growing patent troll plague last year during a fascinating This American Life radio piece titled: ?When Patents Attack!?. But for tech companies here in the Silicon Valley, and the tech community at large, patent trolls have been a problem for a long time. As they stand today, our current patent laws do little-to-nothing to protect companies from egregious lawsuits. A new bill proposed this week might actually make a dent in the saga of tech patent wars.

Earlier this week, Congressman Peter DeFazio (D-Ore.) and Jason Chaffetz (R-Utah) introduced the Saving High-Tech Innovators from Egregious Legal Disputes (SHIELD) Act, which would force patent trolls to pay defendants? legal bills.

How will this ?loser pays? rule help undermine trolls? The typical troll?s business model is to make make broad claims of infringement on patents and then threaten companies with lawsuits. More often than not, the defendants choose to pay up in licensing fees rather than spend time and money it takes to battle in court. So fee-shifting, making trolls pay the bills, ?empowers innovators to fight back, while discouraging trolls from threatening lawsuits to start?help tilt[ing] the playing field slightly more in favor of the good guys?, as EFF explains.

Without doubt, more comprehensive legislation focused on patent reform would be ideal, but this new law is a step in the right direction, especially considering how much patent trolling has cost the economy in recent years. A new study released in July, found that that trolls are costing the economy $29 billion a year in direct costs. ?This is especially difficult for small companies that spend $1.33 million per troll lawsuit. From heavy legal costs to licensing fees, $29 billion is money that can?t be spent on, well what patents are all about to begin with?innovation!

As Gary Shapario, President and CEO of the Consumer Electronics Association, told Forbes earlier this week:

If we want to build American businesses and create jobs, we need to change the laws that encourage excessive and costly litigation..the legal war on business is destroying our ability to compete and succeed. We can and should start with changes to our legal system to protect our economic future.

What?s also important to note about this bill is the fact that it includes, for the very first time, an actual definition of the term ?software patent?. The legislation defines a software patent as a patent covering ?any process that could be implemented in a computer regardless of whether a computer is specifically mentioned in the patent? as well as any computer system programmed to carry out such a process.

But, in some interesting legal gymnastics, even as SHIELD defines patents, and provides innovators with stronger protections, the bill does not endorse software patents. The drafters even included a provision to ensure the bill is not ?construed as amending or interpreting categories of patent-eligible subject matter.? In other words: just because we?re defining ?software patent? it does not mean software patents are legal.

Passing this legislation is still far down the line, but the fact that Congress is taking steps towards fixing the mess caused by frivolous lawsuits and patent trolling is a good thing for innovators and startups, and not to mention the economy as a whole. Whether it?s Foursquare?s GPS system, or Apple?s Siri, it?s the patents that give those innovations any economic value. Yet, from legal scholars within the industry, we?ve heard it said that patents don?t serve their purpose, and we don?t need them. The Federal Appeals Court Judge, Richard Posner, who dismissed the high-profile suit between Apple and Motorola says ?it?s not clear that we really need patents in most industries.? I say, tell that to the USPTO who?s issued some pretty crazy patents in the last couple decades?

Related articles

About Sona Makker

Sona Makker is a recent UC Berkeley grad with a B.A. in Sociology. She's especially interested in emerging issues at the nexus of technological innovation, access to information and data privacy. To satisfy her creative side, Sona loves to whip up new vegetarian dishes and enjoys all things crafty. Follow her on Twitter @sonamakker

Source: http://www.article-3.com/shield-against-patent-trolls-98209

wayne gretzky wayne gretzky occupy los angeles occupy los angeles comedian patrice o neal occupy philadelphia occupy philadelphia