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The Truth Behind Patent Trolls Issue Brief (view source)
Revision as of 16:31, 6 April 2016
, 16:31, 6 April 2016→What is a Patent Troll?
No agreed-upon definition of patent troll exists. The term patent troll is used interchangeably with the terms non-practicing entities (NPEs) and patent assertion entities (PAEs). Despite similar sounding names, several key differences exist between the three terms.
Non-practicing entities own patents, but do not necessarily create products out of these patents. This behavior is pretty common; 95% of patents are never used commercially [http://www.wired.com/2015/01/fixing-broken-patent-system/]. Universities are examples of non-practicing entities. Faculty members may file for patents based on their work in a laboratory and receive a patent. Then, those faculty move on to a different project and do not use the patent they hold.
Patent assertion entities (PAEs) are a type of non-practicing entity that generate a majority of their revenue through licensing patents they own. For example, a large firm may buy up a thousand patents. Instead of creating products derived from those patents, they license these patents to other firms that wish to create those products. If another firm infringes on a patent, the patent-assertion entity may send a demand letter to the company with a warning. The demand letter warns the infringer that they are subject to a lawsuit if they do not acquire proper licensing of a patent. '''(Maybe present some story to get the point across easier.)'''
