PublishedSeptember 4, 2013

New Study by PatentFreedom Shows We Need Expanded CBM Review

If there were ever any doubt that expanding the Covered Business Method review program would have a major impact on the patent troll problem, a newly released study from PatentFreedom should put those doubts to rest. According to the study, patent trolls’ use of business method patents is increasing quickly, and more and more non-tech businesses are being targeted with them. In fact, the majority of troll lawsuits using business method patents are filed against companies that are not in the high tech industry.

The study provides strong support for expanding CBM review, as I’ll explain.

PatentFreedom found that we’ve gone from about 168 companies defending themselves against business method patents in 2004 to 1423 in 2012. That’s almost a ten-fold increase in less than a decade! In fact, nearly 4 out of every 10 patent troll lawsuits now uses a pure business method patent.

Here’s PatentFreedom’s breakdown of the categories of business method patents:

Only 9% are financial services patents. Under the current law, those are the only patents that are eligible for Covered Business Method review.

That leaves over 90% of the business method patent trolls use ineligible for CBM review.

And that’s why, as I’ve written before (see here and here), expanding CBM review is so important. As PatentFreedom’s study shows, thousands of businesses are targeted by patent trolls using business method patents. And almost 90% of those cases are eventually settled.

These target businesses need some way to defend themselves. Expanding CBM review will provide a critical tool to do just that.


Matt Levy

Previously, Matt was patent counsel at the Computer & Communications Industry Association

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