A Shield For Software

By: Robert D. Becker
– Intellectual Property Magazine

In March, Congressmen Peter DeFazio and Jason Chaffetz introduced HR 845, the Saving High-Tech Innovators from Egregious Legal Disputes (SHIELD) Act of 2013.

According to DeFazio, the act is intended to "force patent trolls to take financial responsibility for their frivolous lawsuits[,]" which "hurt American innovation and small technology start ups, and they cost jobs."

Chaffetz says the legislation "ensures that American tech companies can continue to create jobs, rather than waste resources on fending off frivolous lawsuits."

A contrary view of "trolls" (sometimes called Non-Practicing Entities or NPEs) was recently expressed by Judge Sue Robinson of the District Court of Delaware:

"With respect to the characterization of Cradle IP as 'simply a litigation vehicle for Cradle Technologies,' many businesses and academic institutions enforce their patent rights through private companies (like Cradle IP); such a business strategy is not nefarious. The court declines to treat such nonpracticing entities as anything less than holders of constitutionally protected property rights, those rights having been legitimized by the Patent & Trademark Office. Therefore, the fact that a plaintiff is characterized as a 'litigation vehicle' does not detract from the weight accorded a plaintiff's choice of forum."

This article analyses both points of view, concluding that the most serious issue is not with the entities asserting presumptively valid patents, but with frivolous patent litigation.