This paper examines the confluence of two important issues concerning patent law. The two issues are the merits of the debate concerning the supposed “patent troll” crisis and the increased patenting and licensing of university and other nonprofit inventions, including the litigation of those patents.
First, there is a debate in the literature concerning the presence and scope of the problem concerning so-called “patent trolls.” To some, supposed “patent troll” behavior is ordinary litigation behavior, and to others, it points to problems with the patent litigation system. Indeed, some may argue that the benefits of “patent trolls” may outweigh the negatives; however, the literature is not clear on an answer to that question. The literature does point to certain factors which indicate when a patent holder may be abusing the system and behaving as a “troll.” This article provides a review and analysis of some important patent enforcement literature.
Second, there is a substantial amount of literature concerning the patenting and licensing by universities and other nonprofits since passage of the Bayh-Dole Act in 1980. The Bayh-Dole Act allows universities and other nonprofits to patent government funded invention. The literature points to issues that may arise concerning university patent related activity, including some efforts by universities to lobby to protect their interests. This article provides a review and analysis of some of that literature.
Finally, this article analyzes data from multiple sources at the confluence of those two issues, asking whether universities and other nonprofits are behaving similarly to so-called “patent trolls.” Our research finds that in some instances universities and nonprofits may share some characteristics similar to “patent trolls.” However, while we believe that casting a particular narrative over the data is relatively dangerous, there is cause for concern in the future. There are several factors that may make it more likely that universities and nonprofits will engage in additional litigation in the future, including perhaps abusive litigation practices resembling so-called “patent trolls.” Indeed, several factors may place increased pressure on universities and nonprofits to find ways to monetize their patents. For example, the U.S. government appears to desire to cut research funding to universities, and universities will be searching for additional revenue streams. Moreover, most technology transfer offices fail to generate enough revenue to sustain themselves and will likely push for increased patenting, licensing, and even litigating to fund their operations. And, universities appear to be changing their tenure policies to encourage commercialization activities. As universities and their technology transfer offices search for funding, they may believe that commercialization and patent enforcement is the answer. We conclude that university and nonprofit litigation should be carefully monitored in the future, including patent litigation by academic and research institutions based outside the United States.
Teo Firpo, et al., Monitoring Behavior: Universities, Nonprofits, Patents, and Litigation,
SMU L. Rev.