Since the early 2000s, patent trolls—opportunists who obtained questionable patents and asserted those patents against large operating companies to extract nuisance value settlements, leveraging the high cost of patent litigation defense—have been a blight on the patent system in the United States. So impactful were they that Congress mobilized and President Obama enacted the America Invents Act in 2011, which, in part, was designed to curtail this kind of advantage taking. That statute, along with action by the U.S. Supreme Court, have been widely heralded as effective antidotes to the patent troll problem. Still, opportunists abound—as does the money that funds them—and may be leading to a shift from patent troll activity to troll-like activity in other, analogous types of high-tech litigation in the realms of privacy and cybersecurity.

Recent Decline of Patent Trolls

For decades now, patent trolls have capitalized on the high cost of patent litigation defense to extract settlements. Big businesses for years have faced the Hobson’s choice of either spending millions of dollars defending the frivolous patent suits brought against them by patent trolls, or avoiding those litigation costs and making quick settlement payment to the trolls for a fraction of that amount. Pure math made it difficult for most companies to justify taking a stand against the trolls, and at least some reports estimated the trolls had cost defendants over half a trillion dollars in economic value by 2011. See James Bessen et al., The Private and Social Costs of Patent Trolls (Boston Univ. School of Law, Law and Economics Research Paper No. 11-45, 2011).

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