Patent trolling a thorn in the side of hi-tech giants

David Wilson

'Spectators' build up an IP portfolio and then wait for a big firm to infringe upon it

New economy sources strenuously avoid using the words 'patent extortion'. The phrase is taboo for good reason. The Illinois-based patent purchasing firm TechSearch slapped a libel suit on the semiconductor giant Intel when a spokesman called TechSearch 'a patent extortionist'.

Even so, when tech analysts talk about 'patent trolling', they essentially mean the same thing: a devious scheme to make easy money. Trolling boils down to amassing an intellectual property portfolio, then sitting back and waiting for some tech titan to blunderingly infringe upon it.

The speculator then swoops with threats of a lawsuit and hopes that, to save hassle, the corporation in question will decide to settle out of court rather than fight. Patent trolling is all about finagling rather than working to get ahead. Critics say it stifles innovation and hurts the consumer by driving up prices.

It was law expert Peter Detkin who highlighted the phenomenon by coining the curious name. During his tenure as assistant general counsel at the semiconductor giant Intel, Mr Detkin found that most of his time was taken up battling patent infringement claims by businesses that could scarcely spell 'semiconductor'. In 1999 alone, the claims supposedly exceeded $15billion.

He placed a couple of troll dolls, like voodoo effigies, on his desk and branded the firms that expected Intel to cough up 'patent trolls'.

One wonders whether Mr Detkin tried to patent the catchy term, which so neatly fuses the image of a moving baited line with that of evil cave-dwelling Scandinavian goblins - in other words, a vile version of the garden gnome with a fishing rod.

Either way, the press routinely crucifies companies that seem to be guilty of dabbling in the black art. Just look at how USA Today attacked Ed Pool, chief executive of DE Technologies, in Virginia. Mr Pool claimed to own the rights 'not just for some little doohickey inside a computer, but for Dell's entire method for doing global transactions over the internet,' USA Today columnist Kevin Maney sniped.

'Do you realise,' Maney continued, 'that Pool invented global e-commerce? He has a US patent on it: No6,460,020 sought by him in 1997, issued in 2002. Isn't that incredible? It's like inventing highways. Or plumbing.'

To suggest that someone is a patent troll must rank as one of the cruellest jibes in the digital dictionary. I would rather be accused of spreading spam or consulting for Enron.

That said, the sniping is far from one-way. Some sources see the likes of Ed Pool as have-a-go heroes sticking up for the rights of small-time inventors in the face of corporate thuggery.

One Business Week amateur reviewer nicknamed Rack snaps: 'I love it! The big guys can dish it but they can't take it. When small companies/entities complain that the patent system only helps the big guy because of the sheer cost of litigation and appeals, it's the big companies that say the patent system works great and that democracy and capitalism couldn't be better.

'Now, put the big company on the receiving end of their own crap, and all of a sudden the big guys complain that the patent system does not work, and that the little guy has all the advantage.'

As the flak from Maney and Rack illustrates, patent trolling is one of the most vexed issues in this field. It is hard to know whether to look at the claimants as opportunists out for a quick buck or people's heroes sticking it to the man.

A development that underlines the stickiness of the controversy is that Peter Detkin now operates as a partner in the patent licensing firm, Intellectual Ventures: a classic patent troll outfit, according to detractors.

Whatever the truth of the allegations, please excuse me because I now need to file a patent - and not just for some 'doohickey'.

Its remit will be what I am doing now - chewing sugar-free spearmint gum while using a word processing package together with Firefox: a recipe for miraculous productivity. You read it here first.