Monday, December 23, 2013

Patent trolls aka Patent Assertion Entities (PAEs) and the FTC

The Federal Trade Commission has had a public consultation on patent trolls. The FTC, however, adopt the industry's own description of itself as "Patent Assertion Entities (PAEs)". Once the government accepts patent trolls as legitimate economic actors, the battle to explain (or even attempt to understand properly) the complex calculus of their effect on the economy is effectively over.

Some of the submissions make interesting reading, though unsurprisingly, Intellectual Ventures (IV) have a slightly different perspective to, say, the Electronic Frontier Foundation (EFF) and Public Knowledge (PK). 

IV conclude:
For all the reasons described above, the information requests do not meet the requirements of the Paperwork Reduction Act, nor, more importantly, will they assist the Commission in meeting the goals of the 6(b) study. As currently drafted, the requests miss the opportunity to focus on the broader, economy - wide effects of patent assertion activity by different types of entities, and thus provide the Commission with no ability to compare the costs and benefits of PAE activity to its alternatives. The requests will also create enormous burdens for respondents, require unnecessary information, and generate a record far too large for the Commission to process efficiently. This combination may significantly delay the issuance of the report, which would greatly diminish its value. Because timely insights are critical, and IV is eager to work cooperatively with the Commission to ensure that it receives the information it needs to meet its goals in a timely manner, we respectfully urge the Commission to modify the requests as noted above.
Translation: stop irritating us with costly red tape and produce a report telling everyone how wonderful we are.

The EFF and PK, on the other hand, say:
The proposed Section 6(b) study would significantly advance the quantity and quality of public information regarding patent assertion entities. The study would, thus, both directly help the diverse targets of PAE activity and enable the FTC and other policymakers to better serve consumers and preserve competition. The FTC is also particularly well suited to make these requests; it has the necessary statutory authority and experience in consumer protection and patent policy to conduct this particular study. Finally, the Section 6(b) study's proposed respondents would find complying with the questions manageable and straightforward. Because the public understanding of PAEs remains limited by PAEs' covert practices, the FTC should proceed in asking these entities to provide basic answers that would serve consumers, small businesses, policymakers, and the general public.
Translation: these sneaky patent troll parasites are sucking real innovators and consumers dry; and the FTC are well placed to expose them to the public gaze and take them down a peg or two. It won't cost the trolls anything to fill in a few forms to attempt to justify themselves, so it's the least they should be asked to do.