Avoid Being Patent Trolled

Avoid Being Patent Trolled

As an aspiring inventor, you may have quite a few ideas up your sleeve. You may have already had one of your ideas patented. You may think that once your idea becomes patented and has reached consumers through a successful marketing campaign, your worries are over. However, there could be many headaches for you in the future. Aside from the fact that in the long run your patented item might be improved upon by someone else and you’ll lose sales, there’s a chance you might become patent trolled.

Patent trolling, which has been around since the early 1990’s, is the practice of purchasing relatively aged and/or inactive patents specifically to sue companies that have built upon them. It may be hard to understand why people do this. A simple example of patent trolling could be described as follows:

You invented instant lemonade. You patented the creation, it became very popular, and it sold for a long time. A competitor decided to add electrolytes to the instant lemonade, patented it, and eventually, over time, the electrolyte lemonade put the regular lemonade out of business. A guy who has a bit of money bought the patent of the instant lemonade from you, telling you he planned to sell more instant lemonade and make the product marketable again. Once he completed the sale, instead of selling the lemonade, he filed a lawsuit claiming that the electrolyte lemonade infringed on his idea, and wants the electrolyte lemonade company to pay him damages.

It may sound unfair, but this practice has become a major problem for inventors in recent years. As a result, many inventors have felt that if they improve upon an existing idea, they might just be subject to lawsuits in the future by opportunists that make their money specifically from litigation. Even if the inventor wins the battle, it can be time consuming and expensive, with legal costs running into the millions of dollars.

Patent trolls can easily acquire patents. Usually, if a company is near bankruptcy, they may try to auction their patents off to avoid further hardship. Patent trolls can purchase the patents at a very low price, in this case. Some patent trolls own hundreds of patents and are chronically involved in lawsuits. They keep their eye on recent patents filed by larger companies that have improved upon a product and target them due to their high amounts of revenue.

The problem has led to the US Patent and Trademark Office (USPTO) and Federal Trade Commission to be on the look out for patent trolls. Regulation to prevent frivolous litigation is currently in the works, but as an inventor, you can take steps to ensure that your invention won’t be subject to patent trolling. Keep in mind that you are only open to being patent trolled if your invention improves upon something that already exists.

The first defense you can take against being patent trolled is to create a ‘design-around’. In other words, you can change your invention in a small way so that by definition, its functionality is technically not based upon a previous invention. Secondly, there is insurance available to the inventor to avoid having to deal with patent infringement litigation, but it is not considered inexpensive. Finally, if you find yourself capitalizing heavily on an invention that you based on one that is simpler, you may want to use some of your earnings to purchase the older patent before patent trolls do.