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Overview of the ńˇýPatent TrollsńˇŁ Debate
Brian T. Yeh (au)
Congress has demonstrated significant ongoing interest in litigation by ńˇýpatent assertion entitiesńˇŁ (PAEs), which are colloquially known as ńˇýpatent trollsńˇŁ and sometimes referred to as ńˇýnon-practicing entitiesńˇŁ (NPEs). The PAE business model focuses not on developing or commercializing patented inventions but on buying and asserting patents, often against firms that have already begun using the claimed technology after developing it independently, unaware of the PAE patent. PAEs include not only freestanding businesses but patent holding subsidiaries, affiliates, and shells of operating companies that want to participate in the PAE industry and/or a new means of countering competitors. The proliferation of PAEs was among the central factors raised in support of the most recent patent reform legislation, the Leahy-Smith America Invents Act of 2011 (AIA). However, the AIA contains relatively few provisions that arguably might impact PAEs, apparently because of debate over what, if anything, should be done about them. Recently, the Saving High-Tech Innovators from Egregious Legal Disputes (SHIELD) Act of 2012 (H.R. 6245) was introduced in an effort to affect the number of lawsuits filed by PAEs. Contents of this report: Introduction; Patent Law Fundamentals; The ńˇýPatent TrollsńˇŁ Controversy; Behind the Rise of PAEs; Legislation in the 112th Congress; Other Legislative Options. This is a print on demand report.
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