May 16, 2013
As Josh Lamel noted the other day, end-users such as retailers, financial services, grocery stores, advertising, hotel industries, and even oil companies are coming out in droves to fight abusive patent troll tactics. The FTC has posted all 68 public comments submitted to its patent assertion entity workshop; a surprising number come from end-users.
Patent trolls have started to target end-users, especially small companies, because they typically lack the expertise, experience and ability to fight questionable claims. Litigation costs can quickly mount up to $250,000 to $500,000, and reach millions if the case goes all the way through trial (not to mention appeals). End-users also have to deal with disruptions to their business from discovery requests and managing the litigation. Often companies are forced to divulge secret financial and technical information as well as divert key personnel from their work to participate in depositions and give testimony. Patent trolls, on the other hand, have few costs in pursuing a suit because they do not operate in any market. The lawsuit has no disruptive effect on the patent troll’s business because it is the patent troll’s business.