Unpatent To Take on Patent Trolls

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Unpatent To Take on Patent Trolls


Newegg and its Chief Legal Officer, Lee Cheng, have been outspoken and uncompromising in opposition to patent trolls. Cheng has now joined forces with two well–known hackers, Luis Cuende and Jorge Izquierdo, on their new venture, Unpatent, with the goal of “fixing the innovation framework,” beginning with patent trolls, which they describe as a “glitch in the system” and identify as “usually law firms that extort people and companies over totally stupid, obvious patents.” The method is simple: crowd–funded reexamination petitions based on crowd–sourced prior art searches.

The first target of their efforts is U.S. Patent No. 8,738,435, owned by Phoenix Licensing, and identified by the Electronic Frontier Foundation as its Stupid Patent of the Month for February 2016. As EFF describes it, “the patent claims the idea of sending a personalized marketing message using a computer.” Since 2013, Phoenix Licensing has filed over 30 lawsuits under the patent in the Eastern District of Texas, eleven of which remain active.

It will bear watching whether recent innovations like crowd–funding and crowd–sourcing will prove effective in eliminating patents being asserted against companies for performing basic business tasks on a computer or over the Internet. Businesses of all sizes targeted by patent trolls will benefit from cost–effective and efficient means of undercutting the troll business model, which relies on the high cost of litigation as a pressure–cooker to prompt settlement.

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