It’s been a huge week for patents — starting with This American Life’s follow-up on Nathan Myhrvold’s Intellectual Ventures and followed on Tuesday with President Barack Obama announcing plans to try to curb the activities of patent trolls. As part of Obama’s 5-point plan, the National Economic Council and the Council of Economic Advisers released a detailed report titled Patent Assertion and U.S. Innovation.
It goes into amazing detail on the rise of patent trolls, pointing out that the firms have had a “negative impact on innovation and economic growth.”
But here’s the stat, and accompanying chart (above) that kind of puts things in perspective and highlights the problem that the Obama administration is trying to solve.
Patent trolls, as described in the report as PAEs or Patent Assertion Entities, were responsible for 62 percent of all patent infringement suits in the U.S. last year. The number of suits stood at mind-blowing 2,500 last year. That’s up from 1,500 suits in 2011, or 45 percent of the total. Compare that to 2006 when they were responsible for just 19 percent. Obviously, a growing problem.
More from the report.
PAEs often threaten to sue with the intention of extracting license fees or settlement payments. The increase in the number of suits filed for patent infringement has thus been accompanied by an increasingly large number of suits threatened. PAEs assert broad patent claims against an unusually large set of potential defendants; these assertions are often not based on any evidence of infringement by an individual defendant, but are instead an attempt to find companies that will seek to settle the PAE’s claims rather than risk a trial. Conservative estimates place the number of threats in the last year alone at a minimum of 60,000 and more likely at over 100,000.
Full report here: