The America Invents Act 500 Expanded: Effects of Patent Monetization Entities

Abstract

Public attention is increasingly focused on patent monetization entities. Known colloquially as “patent trolls,” these entities derive income from licensing or litigating, rather than producing a product. To understand the impact of these entities, we examined all patent litigations filed across four years, 2007-2008 and 2011-2012. This involved analyzing almost 13,000 cases and almost 30,000 patents asserted. Most striking, as of 2012, litigation by patent monetization entities now represents a majority of the patent litigations filed in the United States. In fact, 58.7% of all patent lawsuits were filed by monetizers. This is a sharp rise from 2007, when monetizers filed only 24.6%. In addition, of the parties who filed the greatest number of patent litigations in the years we studied, all 10 are monetizers.We also examined the age and transfer patterns of the patents asserted. Among other findings, we saw that the newest patents issued are the ones most frequently litigated. This could suggest that people are increasingly applying for patents with the intent of filing lawsuits, rather than making products.Our analysis also revealed a problem previously unrecognized. Mechanisms for notifying the public when patents have been asserted in lawsuits are woefully inadequate. Current mechanisms did not operate 2/3 of the time. The study also found indications of stealth behavior, as well as a market for purchasing patents after they expire.