What is a “Patent Troll” and why you should care

You’ve been bombarded with “Patent Troll” calls-for-action (CFAs) and you’re probably wondering why REALTORS® should care. Why is NAR, RANM and GAAR constantly pushing support of this legislation

Patent trolls target and impact real estate technology.

First, we need to understand that “patent trolls” are NOT typically inventors. They are more likely a patent holding company (PHC), patent assertion entity (PAE), and non-practicing entity (NPE). These companies primarily employ lawyers and litigators that attempt to enforce patent rights against accused infringer far beyond the patent’s actual value. Whether they purchased a small piece of code or technology from an inventor or located code or technology that was in common use and not patented, they attempt to

Patent trolls not only target manufacturers, they target customers.  They target MLS customers. In fact, GAAR and many other MLS customers have been targeted by patent trolls for code snippets used by our MLS vendor at the time. They have also been targeting customers of some printer and scanner manufacturers.

In fact, they have cost NAR millions of dollars in settlement fees because it less expansive to pay the exorbitant fee than it is to battle it out in federal court for years. While patent trolling is currently legal, the unethical takes advantage of loopholes in our patent system. They know that the fees they charge are much higher than the value of the patent, but ultimately much less expensive than going to court.

Congress has drafted legislation – H.R. 9 - The Innovation Act – to close these loopholes. So, when a developer uses code in the public domain, that code cannot later be patented.

It would require more particularity in demand letters and lawsuits, shift both parties’ litigation fees to the losing side, limit often expensive and time-consuming discovery, require disclosure of all beneficial owners of asserted patents, and protect users and purchasers of alleged infringing products from suit unless the manufacturer had first been sued or if the manufacturer agreed to assume defense of the suit.

So, once again, we ask you to contact your U.S. representative to urge support of H.B.  9.  It’s common-sense legislation that protects customers and end-users from Patent Trolls and makes court cases less expensive for all parties involved.

Click here to read H.R. 9 - The Innovation Act – as posted by Congress.