Patent Trolls

The article, "Debunking the Patent Troll", found at BusinessWeek.com, discusses non-practicing entities and the criticism they have garnered as of late. To be precise, non-practicing entities are companies that acquire patents and seek payment from companies they feel infringe upon those patents. One of the bigger problems facing many tech companies in todays' business environment is the increase in product complexity, which is forcing more and more companies to place restraints on research departments. This leaves the company looking outside for help in innovation. The article then goes on to describe how external R&D falls into two different categories, "operating companies" and the "failed entrants" group. Operating companies include competitors, suppliers, customers and other similar groups, while failed entrants are made up of inventors, startups and universities who don't dare enter the market on their own. One idea that many hope will come to fruition is the reformation of patents. This is needed because many feel NPE's create patents that are too broadly defined and should never have been granted in the first place. Another criticism involving NPE's is that they should not ask for money if they haven't produced anything. The next portion of the article separates the two main groups that NPE's, or "patent trolls" as they are often reffered to, make up. These two groups are innovators and patent investors. Many innovators are individuals or companies who have tried to bring their innovations to the market but have failed. Patent investors are usually funds or companies that seek profit from price differentials. According to the author, patents belonging to individual inventors/ failed entrants are more meaningful to the inventor than those belonging to large companies. He believes innovators should be free to benefit from their inventions without having to be experts in raising capital and running a company. The curent patent system could definitely use a tune up, as stronger patent rights are needed.