Patent Assertion Entities

Abstract

The DOJ and FTC held a hearing on patent assertion entities (PAE, defined as an entity that uses patent primarily to obtain license fees, rather than to support the transfer or commercialization of technology) on Dec 10. This talk gives an overview of the economics, policy of patent assertion entities drawing upon previous and new empirical work. Using pathbreaking, disruptive techniques and capturing economies of scale, PAEs drive down the cost of patent enforcement. So far in 2012, PAEs have brought 61% of all patent litigations against fewer defendants than in 2011, due largely to changes in the law through the America Invents Act. 76% of PAE defendants were sued by a PAE that sued more than 15 defendants, and 61% were sued by a PAE that had brought 8 or more cases. These and other details about their business model, practices, and policy concerns are discussed in this powerpoint presentation.

Keywords: patents, PAEs, trolls, economics of litigation