This makes me wonder if there is a market for patent troll insurance. Pay a small monthly fee and get legal protection or money to hire your own counsel in the event of a lawsuit. It seems to be a pain point that small startups worry about, since it can be pretty deadly to a busines, even if they are innocent.
That's the key to it all - you have HR startups, insurance firms, cybersecurity firms etc. bundle the cost of patent troll insurance into their product, give them a commission, and have them sell it to small businesses - not just startups. Then you can keep the price much more affordable because you have an economy of scale!
So when is someone going to start a company offering small startups patent troll insurance? Obviously, Congress isn't going to fix anything. Other solutions need to be explored.
What if there were a company that insured start-ups against patent trolls? The insurance would be set up in a way that gave the companies a large incentive to pursue the lawsuit fully, and to sue for expenses. For example, the insurance could cover legal costs of the defence suit and expenses lost, and also give a financial incentive to sue the troll for legal expenses (perhaps by matching some percent of any legal fees recovered from the troll).
The idea would be that a company with this insurance would not be a target for trolls, as long as the company made it known they had the insurance policy, because the trolls would realize that the company stands to gain by fighting the troll in court.
I wonder if it's possible to make some sort of patent troll insurance company.
Basically a company that attempts to collect as many patents as possible to weaponize against trolls and then provides legal protection to clients from trolls. The clients can share their patents with the insurance company too to help them become more powerful.
Then when sued by a troll the insurance company goes scorched earth to destroy them as a matter of policy. So their clients get the benefit of also deterring suits just because they're represented by this insurance company.
Assuming that abstract ideas are usually intersected by earlier abstract ideas (since they're so broad), perhaps the insurance company could lease the patent hordes of large companies, to deny trolls' claims. That could reduce the cost of the insurance.
One additional thought: anyone who buys patent troll insurance instantly becomes a highly-cooperative target. Why fight it? Why ignore it? Just send the contact info for your insurance company, and let them pay it.
Nice idea but it doesn't work because when I sue you with a bogus patent troll, you can't make money out of it. All you can do is make the lawsuit go away and lose as little money as possible.
So it's a win-lose scenario. So there is no insurance possible. The best lawyers in your hypothetical insurance company, at best could convince the judge that you are not infringing. But it won't make you any money. So there is no business insuring against patent troll.
So beside patent trolls, do you have any example of software patent case where a big company blocked a startup based on patent? (recent example, after elis).
The insurance being used to fight the patents seems good: it's effectively a way for the group to pool resources towards not paying out to patent trolls. The success of the insurance company should be based on the reduction of payments to trolling, even when counting the insurance as paying to patent trolls
What'd be most disheartening is if the insurance was just to pay off the patent trolls
Unfortunately the economics of insurance & low settlement demands from patent trolls would simply come into sync at some point.
This is because patent trolling is a low effort attack, while fighting them is a high effort activity. With an insurance company it would be no different: The pool of money from premiums still wouldn't be enough to fight all of the trolls because they would also all be pooled.
It's cheaper to just collect premiums, payout claims as little as possible, and if claims get too high you re-assess your actuarial tables and raise premiums where appropriate.
Insurance companies simply aren't in the business of solving the root-cause of any given problem. They're in the business of risk analysis & pooled risk & selling financial risk mitigation on that basis.
While it doesn't help in this case (since there is already a looming legal threat from an NPE), you can buy patent troll insurance now: https://www.rpxcorp.com/. This covers your legal fees in the event of litigation, which can scare off a patent troll who just wants a hit-and-run settlement.
reply