FTC Streamlines Patent Troll Study

Yesterday the FTC announced that it has updated its proposed study on patent trolls and is sending the proposed study to OMB for approval.

Not surprisingly the public overwhelmingly supported the study and no commenter opposed it. However, some commenters expressed concerns about the volume of information requested and the burden on businesses that would have to provide the information.

The FTC thoughtfully addressed the concerns raised, especially the concern over providing an answer as soon as possible. Several commentators cautioned that time was of the essence and noted that past FTC studies, such as the study of authorized generics, took several years to complete. In addition some firms engaged in patent assertion claimed that if the scope of information requested was too large it would bog the study down in unnecessary document review.

The FTC recognized these concerns by trying to minimize the amount of data it requested from respondents and streamlined the questions into more direct questions targeted at bad patent troll behavior. Many questions were reworded to have simple answers and the FTC created a spreadsheet to not only make it easier for patent trolls to respond but also for the FTC to analyze the data it receives. The new questions are also a lot more specific on important topics like standard setting commitments.

Hopefully, the changes to the study signal that the FTC recognizes the need for information — FAST. Many of these changes, including the use of spreadsheets and the rewriting of many questions to have yes or no answers, will allow the FTC to produce some data virtually immediately after receiving responses. My initial reaction to the changes is positive. I believe it will be much easier for respondents to the study to produce information in a timely manner, and for the FTC to make at least some important data available to Congress and the public very early on in the process.

Let’s applaud the FTC but cautiously. We need meaningful information as soon as possible. Stopping the egregious conduct of trolls is a critical priority and legislators and its about time for the FTC to put a stronger spotlight on this mischief.

David Balto

David Balto

David Balto is a public interest antitrust lawyer in Washington, DC.  He has over 15 years of government antitrust experience as a trial attorney in the Antitrust Division of the Department of Justice and in several senior level positions at the Federal Trade Commission. David was the Policy Director of the Bureau of Competition of the Federal Trade Commission (1998-2001) and attorney advisor to Chairman Robert Pitofsky (1995-1997). He was a senior advisor in all aspects of the FTC’s merger and non- merger enforcement program and helped litigate the challenges to the Staples/Office Depot, Drug Wholesalers, and Heinz/Beechnut mergers, the Intel monopolization case, and the challenges to anticompetitive conduct by several pharmaceutical companies.