patent troll (PAT.unt trohl) n. A company that purchases a patent, often from a bankrupt firm, and then sues another company by claiming that one of its products infringes on the purchased patent.. —adj. 

In a follow-up to our previous story about lawyer Raymond Niro, from the plaintiffs’ IP firm Niro, Scavone, Haller & Niro, and his offer of $5,000 “to anyone that can provide information that leads me to the identity of Troll Tracker,” Niro has responded with what he felt were some misconceptions in the story.

Niro, described as the Original Patent Troll, is interested in learning the identity of the anonymous author of the blog Patent Troll Tracker, a blog written for the stated purpose “to bring to light the extreme problems our US patent system is having with patent trolls: corporations that make no products, but do nothing but acquire patents to sue and make revenue.”

Troll Tracker insists that he (or she) is “Just a lawyer, interested in patent cases, but not interested in publicity.”

A patent troll is the term coined in 2001 by Intel Corporation assistant general counsel Peter Detkin to characterize Niro and his client TechSearch LLC when Intel was defending a patent suit against them.  Ironically, Detkin is now considered by some to have become a troll himself.

Niro responds:

Please let me correct a couple of misconceptions in your blog.

1. I do not want to find out the name of the Troll Tracker in order to sue for patent infringement; rather, I want to know his name to expose him, so that he can’t hide behind anonymity and may ultimately be held accountable for what he says.

2. Acacia does not own the patent in question. It is owned by Global Patent Holdings who has no connection to Acacia.

3. Anyone that operates a website runs the risk of infringing Global’s patent if (as we believe) that patent covers the manner in which JPEG images are displayed on a website. Troll Tracker is no exception.

4. As for silencing critics, I doubt that is possible. But anyone should be held responsible for what they say and have the courage to express their views by putting their names on whatever it is they publish.

In addition, Niro mentioned that he has raised the reward to $10,000 for information leading to the identity of the Troll Tracker.  “It seems to me if you really have anything truthful to say, you are not afraid of identifying yourself,” Niro stated.  

While Niro frames this as a reward, not a bounty, the meat of the issue is that patent infringement is a high-stakes game.  Global Patent Holdings has now filed three patent lawsuits against 16 companies for infringment of claim 17 of the ‘341 patent by downloading responsive data, including audio/visual and graphical presentations, such as JPEG images and/or other compressed data, on their web sites.

According to IP Law 360, Global Patent Holdings has proposed, for companies that sell products through their websites, a fully paid-up royalty of up to $250,000 for companies with annual revenue of between 0 and $50 million (are they asking for 0.5% of the company’s present annual revenue?). For companies of (annual?) revenue more than $51.2 billion, the proposed royalty is $15 million (closer to 0.03%).

For companies that do not sell products through their websites but have compressed images on those sites, Global Patent Holdings is seeking half the amount – $125,000 and $7.5 million.

Many people consider a patent troll to be anyone that doesn’t produce a product or service themselves but instead makes money from licensing the rights to companies already making products. Under that definition, I suppose Thomas Edison would be a troll.

See the earlier story here.

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13 Comments

  1. […] See Niro’s Response here. Posted December 10th, 2007 by Stephen Albainy-Jenei in Blawg Reviews | […]

  2. Thomas Edison was an inventor. Inventors contribute to society and can legitimately sue others for infringing their patents. If someone supports an inventor financially in suing willful infringers for a junior piece of the pie – he is welcome too. But a troll just picks something from the misfortune of inventors, entrepreneurs and their investors and makes money without any reasonable contribution to anything. This is a clear abuse of the patent system and any reasonable justification for its existence.

  3. Is it just me, or is Niro’s behavior here creepy and ominous? Seems to me this shows the patent system is broken–what ridiculous lawsuits.

  4. Either a patent is property or it’s not. And if it is, then the illogic of MT’s position is made plain by the following substitutions made to his/her comment:

    “John Smith is a builder. Builders contribute to society and can legitimately sue others for trespassing on their buildings. But a buyer of that building (let’s say, at a foreclosure sale) just picks something up from the misfortune of the builder and his lender, and makes money without any reasonable contribution to anything. This is a clear abuse of the real property laws and any reasonable justification for its existence.”

    Is MT willing to agree to that as well?

  5. To Josh,

    A patent is a property granted by society for very specific reasons. Trolls abuse and misuse these reasons. Not all kinds of property are the same – for example you can call the police if someone steals your car, but not if someone infringes your patent; also, your car cannot become invalid. Last but not least, you don’t get other forms of a billion dollar propety for a few hundred dollar goverment fee. Thus, there are different kind of propery that deserve different proprty rights.

  6. MT: I’m thinking by the statment “you don’t get other forms of a billion dollar propety for a few hundred dollar goverment fee” that you do not really know much about this whole patent thing. It’s many thousands of dollars even for a pro se inventor to get an issued patent (and more to maintain it). Also let us not forget the legal representation.

  7. To yo,

    For a small entity, the present fees are $435 to file, $1020 to issue, and $455/1180/1955 in the 4th, 8th and 12th year for maintenance. See
    http://www.uspto.gov/web/offices/ac/qs/ope/fee2007september30.htm

    This is what the country charges for the patent property.

    And I probably do know something about the patent thing because I have successfully obtained many of them.

  8. As I read the Constitution, a Letters Patent are granted “To promote the Progress of Science and useful Arts.” If the ability to assert patent rights depends on who you are, then the value of patents is diminished just as the value of an apartment building is diminished if I must allow squatters to live rent-free if I didn’t build the building.

    If I do buy an apartment building and there are people living there, I can’t just call the cops to have them thrown out. I have to commence eviction proceedings. This is so even if their lease had run and they weren’t even paying rent! And while a car can’t be “invalidated,” if I happened to buy a car that turned out to be stolen, my ownership claim could certainly be “invalidated.”

    Finally, there actually are other forms of “billion dollar property” for a few hundred dollar government fee – Letters Patent relating to mining claims.

    And if you’re going to scrutinize the motives of trolls, what about those corporations which make calculated business decisions every day to act without due regard for the intellectual property rights of others and profit unjustifiably therefrom because they know that it costs millions of dollars for patent holders to vindicate their rights. In such cases, trolls can offer one of the only avenues for an individual inventor to assert his or her rights against a corporate giant. The patent rights granted to the inventor become more than a hollow promise. With the resources necessary to enforce the patent, a troll enables the inventor to realize the value in the patent and, often equally and even more importantly for many inventors, to give due recognition to their inventive contribution.

    In contrast with the Scandinavian troll of legend, casting sunlight on a patent troll reveals a risk-taking enforcer of rights, a champion of the little guy, a modern-day dragon slayer.

  9. Josh,

    I specifically welcomed the financial backer and partner of the inventor. On the other hand, trolls often buy patents for a ridiculous price from bankruptcies, and then assert their “rights” while the inventors don’t see a dime.

  10. […] the Tracker. Niro has now responded to some of the stories about the bounty, where he tries to “correct a few misconceptions” about the story. On one point, he is quite accurate — the patent he’s been accusing the Troll Tracker […]

  11. The patent system was created by society and thus the property is granted by society for very specific reasons, action as quoted “To promote the Progress of Science and useful Arts.” Society acts against immorality by creating laws to reduce immorality, some do not stop the immorality, but society has to try. Likewise society has to enact the laws to regulate against abuse by Troll Trackers. Society needs to begin now or as soon as possible.

    Troll Trackers begin the abuse not to “promote the Progress of Science and useful Arts”, thus the dialog will only increase the abuse by the Troll Tracker as they acquire differing techniques to get around the system. Society has to be swift to prevail.

  12. The troll tracker is… Ray Niro. The bounty is a clever diversion to throw readers off his trail.

    Please send me the $10,000.

  13. […] Raymond Niro Responds to Patent Troll Tracker […]