It’s been a busy two weeks in Asia. First, the IP Office of Singapore hosted its IP Week featuring its Global Forum on Intellectual Property, while this week a good part of the Managing IP team is in Shanghai for the Global IP & Innovation Summit. Both events feature great speakers from all over the world, bringing updates and analysis of the important legal developments in their jurisdictions, with a lot of discussions about NPEs and patent trolls.
Though some argue that the patent troll phenomenon is largely a US issue due to unique features of that legal system, the topic is still very popular on this side of the globe among both multinational and domestic Asian companies. This is understandable; many Asian companies are looking to expand to the US and EU markets, while those already doing business globally must deal with the problem. Simon Choi, head of legal at China-based TCL Multimedia, the third largest flat-screen television brand in the world, said today in Shanghai that large companies such as his have to deal with patent threats from many different types of plaintiffs, including NPEs. While most lawsuits are filed in the US and Europe, he said that he is beginning to see some filed in Japan and Korea as well.
In addition to talk about the threats posed by patent trolls, there was discussion of solutions as well. Acting USPTO director Teresa Stanek Rea (left), who spoke at both events, highlighted recent developments in the US. Along with promising initiatives such as the Global Dossier, which seeks to centralise IP prosecution information among the IP5, she pointed to the Obama administration much-discussed proposals to combat abusive patent litigation.
Of course, the concern with anti-troll legislation is that it may end up hurting entities that are not trolls. At the Global Forum on IP in Singapore last week, Marshall Phelps of IPXI expressed concern about some of the proposed anti-troll legislation, especially those that focus on the non-practising aspects of certain entities. Phelps pointed out that companies such as Qualcomm that simply design chips, as well as prominent research universities such as Stanford and MIT, are NPEs that may be caught by some of the legislation.
Former USTPO head David Kappos made a similar comment about those who he describe as “very smart people who question the fundamental necessity of the patent system”, who use the most abusive patenting practices as evidence that the entire system is broken. Kappos warned that it may be dangerous to make big dramatic changes to a system that he says has been responsible for the tremendous amount of innovation coming out of the US.
Phelps suggested that one very simple way to deal with patent trolls is to increase patent quality, which makes a lot of sense; a lawsuit enforcing a strong and legitimate patent is not considered patent trolling.
Is this enough? Can the trolling problem be largely dealt with just by addressing any patent quality issues we may have? Or are other proposals, such as those made by the Obama administration, needed? Furthermore, to avoid the problem of hamstringing “good” NPEs such as universities and research laboratories, can the problem be addressed by only using proposals that do not revolve around whether the entity is actually practising, such as awarding fees and costs to winning defendants in patent suits?
What do you think? And of course, if you don’t think patent trolls are a problem at all, we would love to hear your thoughts on the issue.