Patent Assertion Entities In The Spotlight

The past few weeks have seen several new ways in which regulators are trying to address patent assertion entities (PAEs) – often referred to in the media as “patent trolls” — through legislation, regulation, and in one case litigation.

In March, Congress began to consider a new bill, know as the SHIELD Act, that proposes to allow defendants who prevail in patent lawsuits to recover costs from the plaintiff in certain situations. As noted in a previous IP Spotlight post, the SHIELD Act has some weaknesses that can hurt both patent holders and defendants, but it may be a first step in broader legislative action.

In April, the U.S. Department of Justice (DOJ) published a set of public comments on a joint DOJ / Federal Trade Commission (FTC) investigation of PAE activities. The comments followed a December 2012 workshop in which the FTC and DOJ explored the impact of PAEs on innovation and competition.