A recent Wall Street Journal article discussed the effect of patent trolls on innovation. Patent trolls are individuals or companies that scoop up patents and threaten legal actions against patent users, “trolling” for licensing agreements or judgments. Patent trolls have been criticized for contributing to a 60 percent surge in patent claims since the beginning of the century.
Adam Carolla is familiar to Los Angeles fans as an entertainer, but the comedian isn’t kidding around about being named in a copyright infringement lawsuit. The intellectual property lawsuit claimed podcasters like Carolla and broadcasters NBC, CBS and Fox infringed upon a 1996 patent owned by Personal Audio. The patent allegedly covers all podcasting.
Personal Audio is a small technology company with zero product output. Investments and patent licensing agreements keep the business afloat. Carolla calls the company a patent troll.
Personal Audio agreed to let Carolla off the hook for $3 million, apparently after learning podcasting was not all that lucrative. The settlement terms also allowed room for Personal Audio to “dismiss with prejudice,” meaning future infringement claims were possible. Carolla refused to settle at any price.
Instead, the comedian is crowdsourcing to pay legal bills with a $1.5 million goal. Carolla has vowed to hold Personal Audio’s feet to the intellectual property fire at a September trial. Amazon pitched in $20,000 for the fundraiser, which at last report was closing in on the half-million dollar mark.
The Wall Street Journal article stated there was no proof patent trolls stunted innovation or business growth. The author suggested patent trolls might be the excuse some patent-dependent corporations need to help roll back licensing costs and make heftier profits.
Costly litigation is the main gripe many defendants have against patent trolls. Not everyone can crowdsource their way to a paid legal bill. Intellectual property attorneys keep clients’ budgets in mind while working toward the most positive legal outcome.
Source: USA Today, “Carolla declined dismissal of podcasting lawsuit” Jefferson Graham, Jul. 29, 2014