Is There a Patent Troll Problem in the UK?
Santa Clara University - Leavey School of Business; Universidad Carlos III de Madrid
Brian J. Love
Santa Clara University School of Law
September 26, 2013
Fordham Intellectual Property, Media & Entertainment Law Journal, Vol. 24, 2014, Forthcoming
This paper reports the findings of an empirical study of patent suits involving non-practicing entities (NPEs) in the U.K. between 2000 and 2010. Overall, we find that NPEs are responsible for 11% of all patent suits filed in the U.K. during this period. Though this is a small percentage by U.S. standards, our study suggests that patent trolling might not be as uniquely American as conventional wisdom suggests. We also find little support for many common explanations for Europe’s relative scarcity of NPE activity. For example, we find that NPEs litigating in the U.K. overwhelmingly assert high-tech patents – even more so, in fact, than their U.S. counterparts – despite higher barriers to software patentability in Europe. Our study does, however, tend to support fee-shifting as a key reason for the U.K.’s immunity to NPEs. We see evidence that the U.K.’s loser-pays legal regime deters NPEs from filing suit, while at the same time encouraging accused infringers to defend claims filed against them. U.K. NPE suits are initiated by potential infringers more often than by NPEs; rarely end in settlement; very rarely end in victory for NPEs; and, thus, result in an attorney’s fee award to the potential infringer more often than a damages award or settlement payment to the patentee. Together, these findings tend to support patent reform bills pending in the U.S. that would implement a fee-shifting regime for patent suits, and may also serve to quell concerns that Europe’s forthcoming Unified Patent Court will draw NPEs to Europe.
Number of Pages in PDF File: 33
Keywords: patent troll, NPE, non-practicing entity, PAE, patent assertion entity, Unified Patent Court, Unitary Patent, SHIELD Act, High Court, Patents County Court
JEL Classification: O34, K41Accepted Paper Series
Date posted: September 28, 2013 ; Last revised: November 15, 2013
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