Monday, March 09, 2009

Patent law academics make troll studies a growth industry

On February 1, 2009, Gwendolyn G. Ball and Jay P. Kesan wrote a paper posted on SSRN titled Transaction Costs and Trolls: Strategic Behavior by Individual Inventors, Small Firms and Entrepreneurs in Patent Litigation. The abstract noted:

Using original court documents to accurately identify the parties, outcomes and disputed patents in cases filed in 2000 and 2002, we explore how the resolution of patent cases relates to the nature of the parties. (...)We find that the licensing firms in our cohort of cases - all of which would have classified as small firms as of 2002 - are a very small percentage of all plaintiffs. (...) Thus, our results suggest that patent litigation is not dominated by trolls, but the best candidates for the troll moniker do seem to behave differently in comparison with firms of similar size.

[As of March 9, the SSRN site states of the Ball/Kesan paper: Date posted: February 04, 2009 ; Last revised: February 18, 2009]

On February 4, 2009, MarketWatch had a post titled Famed patent firm backs study on touchy subject, which noted a "joint venture" by Intellectual Ventures and Mark Lemley on analyzing the number of patent litigations by trolls, which included text:

Lemley said that he's seen estimates on the number of suits filed by non-practicing entities that range wildly, from 2% to 50% of all patent litigation. In addition, many struggle even to define what makes a so-called "patent troll" that acquires patents to use in court, and what makes a legitimate non-practicing entity.

"There is some gray area," Lemley said, "What do you do about an IP-holding subsidiary of a company?"

Intellectual Ventures executive editor Wayt Gibbs said that an impartial study of patent litigation is necessary. "This is very important to innovation policy," Gibbs said. "It shouldn't be subjected to guesses and debates by highly interested parties."
Gibbs said the study is focused on the years 2000 through 2007, and includes "data on every single patent case filed" in that period. The roughly two-year project is being undertaken by a number of different Intellectual Ventures employees alongside Lemley, and is expected to produce several papers.

"We're pretty close now, and we're starting to write up our results," Gibbs said. "We hope the academic community will take this research and expand on it."

IPBiz observes several points.

#1. In the law review business, one has the concept of pre-emption. Is the Lemley/Intellectual Ventures proposed work pre-empted by the Ball/Kesan work?

#2. Related to the similarity in time of the publication of Ball/Kesan as to the Lemley/IV proposal, one notes that Lemley has written (not entirely accurately) about the Alexander Graham Bell/Elisha Gray business. One wonders if Lemley will write about the Ball/Kesan study similarly?

#3. The Ball/Kesan work on SSRN was stated to be revised at a later date. If legal publications are going to be increasingly on SSRN (note also Lemley's "rubber stamp" paper on SSRN, which contradicted an earlier Lemley paper), does one have to worry about a lack of peer review and, separately, about constant revisions? [As a counterpoint, the Michigan Daily (referenced in an earlier IPBiz post, seems to have a policy of NOT altering posts, tho updates are made.]

Note LBE's article Internet Publishing: Online Today, But What About Tomorrow Or Where Have You Gone, 406,302? which stated: In fact, the "error" of Van Gilder and Kukkonen would have been referring to a link to a site that was capable of changing the numbers. Those authors who cite to internet websites for numerical data should be aware that such citation may be perilous in the sense that it is not permanent.

Separately, note the frequent discussion of the Sikahema effect on IPBiz.

**See also

Feb. 4 IPBiz post,
Lemley and friends starting new law firm
, which observed: That is why some are skeptical of the forthcoming study, which is being undertaken in collaboration with Stanford University Law Professor Mark Lemley. If the study finds that non-practicing entities have played a relatively minor role in the rise of litigation, it is likely to raise questions, given the involvement of Intellectual Ventures.

271blog post: Study: Small Firm Plaintiffs ("Trolls") Have Unexceptional Impact on Patent Litigation

The convenience of not remembering history when discussing patent reform
, noting the irony that many patent reformers, who criticize the USPTO for not finding prior art, tend to ignore prior art themselves. [Recall Emerson: the louder he talked of his honor, the faster we counted our spoons.]

**UPDATE. IPBiz notes two comments on a recent Patently-O post-->

I can't say I read you guys too often, but based on recent PatentlyO posts, and the misguided lies we can expect from Mark Lemley in his upcoming testimony - you guys really need to get some practical knowledge of the law!

Posted by: me | Mar 09, 2009 at 10:27 AM

So Strandburg is moving onto NYU? Frankly, her views on KSR International made no realistic sense to me. That's quite common with academia who have had no, or minimal, experience in the "real work" world.

Posted by: EG | Mar 09, 2009 at 10:32 AM

IPBiz notes that, apart from the issue that many IP Profs have no experience with patent prosecution (or science), a large number of them have formed a pack, promoting self-fulfilling prophecies through mutual back-scratching. There isn't any original thought, and there is no tendency to remove bad thoughts by criticism.

Sent to Patently-O-->

Apart from the issue that many IP Profs have no experience with patent prosecution (or science), a large number of them have formed a pack, promoting self-fulfilling prophecies through mutual back-scratching (citation daisy chains). Additionally, because of the connectivity, there is little tendency to criticize the work of other IP profs.


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