The Supreme Court has an upcoming case that could land a blow against "patent trolls."

Intellectual property (IP) protections can be difficult to understand sometimes, even for skilled attorneys. For example, it is hard to objectively and easily tell exactly what rights and protections come with filing and registering patents, copyrights, trademarks, trade secrets and other IP. Some "fair use" of IP is allowable for non-patent holders, while other uses are strictly prohibited unless a license is granted.

Sometimes, improper use of patents warrants judicial or administrative review (and injunctive or monetary relief). In some instances, those cases are absolutely justified. In others, though, they are just a byproduct of the exploitative cottage industry of "patent trolling."

What is patent trolling?

"Non-practicing entities" (NPEs) are individuals or companies who buy IP but don't use it as a creative means to achieve their underlying business goals. Basically, these companies stockpile preexisting IP and parlay that into profit through the legal system.

NPEs are perhaps better known as "patent trolls" because they file lawsuits against other companies at the slightest sign of any supposedly unlicensed use or infringement. Typically, the IP at issue has little substantive value to the NPE independent of the infringement angle, since they don't rely on it to fulfill orders, create products, sell works, etc. Instead, it is solely a means to an end, and a way to bring in revenue through infringement claims.

The stockpiled IP can be very lucrative in terms of infringement claims even if it has no practical, "real-world" application for the NPE. Many infringement allegations are against smaller companies and start-ups, who cannot afford to pay hundreds of thousands of their hard-earned dollars to defend a trademark, patent or copyright suit. These claims usually end in a settlement for the NPE, not because the other company admits any unfair use or infringement, but because it's much cheaper than an ongoing lawsuit.

How SCOTUS could change the face of patent trolling

Patent attorneys, trolls, IP holders and the business world are closely watching the Oil States Energy Service v. Greene's Energy Group case to see what impact it has on the future of infringement claims. The case focuses on administrative procedures - particularly the use of inter-partes review (IPR) - of the U.S. Patent and Trademark Office's Patent Trials and Appeals Board (PTAB).

  • Following an unfavorable decision by the PTAB, Oil States filed a federal suit alleging that PTAB deliberation is actually a regulatory action, and it violates their constitutional right to a jury trial to decide claims.
  • The federal court disagreed with Oil States' claims, affirming the PTAB decision in favor of Greene's Energy.
  • Oil States appealed to the SCOTUS for review of the federal court decision and to basically end the process of inter-partes review.
  • Greene's Energy now requests that SCOTUS affirm the lower court's ruling and remand the case for action consistent with the PTAB's decision.

Do you need help managing IP or fighting off a patent troll?

When you are involved in a technically savvy business, IP issues are likely high priority. Whether you need to establish your rights pertaining to patents, trade secrets, trademarks or copyrights, or you need to fight off a patent troll's claims, you need skilled legal representation. Specially, you need The Eldredge Law Firm. A patent attorney who is also a law professor and mechanical engineer heads our firm. This unique perspective gives us in-depth knowledge about the ins and outs of IP law, and we are ready to put our years of experience to work for you. Call us today at 682-990-2073 or contact us online to set up your free initial consultation.