
Startups can now buy insurance against threat of patent trolls - pjl
http://arstechnica.com/tech-policy/2014/11/startups-can-now-buy-insurance-against-threat-of-patent-trolls/
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denimboy
RPX IS a patent troll. RPX Corporation is a spin-off of Intellectual Ventures.
John Amster and Geoffrey Barker, the CEO and COO of RPX, came from high level
positions inside Intellectual Ventures.

    
    
      http://pando.com/2013/09/09/rpx-and-the-complicated-business-of-stockpiling-patents-for-good-not-evil/
    

RPX and Intellectual Ventures bought the Kodak patent portfolio together:

    
    
      http://www.iam-magazine.com/blog/detail.aspx?g=4d1024d9-1e6c-43fa-8f78-a123f22575da
      http://www.ipwatchdog.com/2012/12/19/kodak-sells-patents-to-intellectual-ventures-rpx-for-525-million/id=31737/
    

RPX and Intellectual Ventures own a common NPE holding company RPX-LV:

    
    
      http://www.plainsite.org/flashlight/rpxlv-acquisition-llc/
    

RPX was sued by Kaspersky Labs for extortion:

    
    
      http://www.scribd.com/doc/56754406/RPX-Criminal-Complaint
    

RPX cannot be trusted anymore than Intellectual Ventures. RPX is playing the
same game as Intellectual Ventures. There is a better than good chance that
RPX and Intellectual Ventures are working together as evidenced by their co-
ownership of patent property and shared personnel history. The Kaspersky
complaint raises the specter of RPX (with or without Intellectual Ventures)
playing a good cop, bad cop style extortion racquet.

How does that insurance look now?

Buyer beware!

~~~
alexqgb
So just like the Mafia they're "offering" to sell you protection
from...themselves.

~~~
Joeri
Wouldn't they be liable for racketeering? If it can be demonstrated that a
large share of NPE lawsuits originate with IV (over a thousand shell
companies), and that they actively prevent meaningful patent reform (dedicated
lobbying office in washington), it seems like they should be liable.

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vikramjb
This seems like I have to pay protection money to a company which supposedly
protects me from other patent trolls.

~~~
johnernaut
E-Mafia.

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SomeCallMeTim
I'd be much more happy to pay into an "insurance" system that _did_ promise to
"fight to the death" over invalid/inappropriate patents.

It sounds like buying this insurance might tie your hands and require you to
buy out the troll, even if the troll's claims are completely bogus (or are
based on extremely broad claims that never should have been granted).

~~~
rosser
"Fighting to the death" runs directly counter to RPX's business model. If NPEs
are discouraged from trolling by a streak of losses, no-one needs to pay RPX's
premiums any more.

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PythonicAlpha
An other example, how software (and other low invention height-) patents are
just existing to get money from small companies and startups (and thus being a
new toll for innovation laid unto the later customers).

An insurance might be a good thing for some startups to reduce the risks, but
it is only a second- (or third-) best solution for the main problem.

The main problem is, that what once should help innovative people, today does
the opposite -- it hampers innovation and is a shield against creative
companies for dinosaur corporations and a living for so called "patent
trolls". And it is -- in any case -- a streaming money-fountain for lawyers.

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renegaid
IANAL/P, but why can't we just pass a law stating that "the patent is not
being used for anything" is a valid patent suit defense?

I imagine this would instantly defuse patent trolling while having no
collateral damage to businesseses that actually use their patents to defend
investments (which is supposed to be the whole point).

Is the only reason we're not seeing such a law because trolling has a powerful
lobby, or am I grossly oversimplifying?

~~~
jgoewert
I agree that this is the way back to sanity.

Most of the patents I have been noticing waved around are "Do something we did
50 years ago... but on a computer". Is the "on a computer" really a definitive
mark.

On the idea of 'paper patents', what is to stop someone from registering
something barely plausible today that may occur in the near future? Say,
something like "3d printed food" where a file that contains the information on
the material is structurally printed and heated/cooled. It isn't possible with
our current tech, but when someone figures it out 5-10 years from now, you
could spring that Jack out of the box and rake in cash.

~~~
jarcane
I am informed that actually the Patent Office is at least starting to back
away from 'on a computer' patents.

I confronted a rather weaselly dude attempting to patent troll tabletop
roleplaying games by filing for a claim on character conversions, with an
exceedingly vague 'with a computer' veneer over it. Fortunately the guy had
his application rejected twice, and looked due to have it rejected again (as
well as having attracted attention from much bigger fish) before he closed
ranks and disappeared.

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teachingaway
Patent trolls have been getting _trounced_ in court for the last few months,
especially in NY and CA. I suspect RPX is offering patent troll insurance now
because their payout risk (exposure?) is now much lower.

The RPX insurance might still be a good idea. Just be sure to re-evaluate the
current state of patent troll risk before you buy a $10,000 policy.

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mikeryan
How is this different than standard Patent Infringement Insurance that already
exists?

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logicallee
Wouldn't this create an adverse incentive (in insurance called a 'moral
hazard') i.e. because you could access the most innovative and highest-value
patented technology for the insurance cost alone? (For example, ARM does not
have its own foundries.)

i.e. you could simply build a startup around reading through patents for the
most valuable ones, and then willfully infringing them. Whether it's some kind
of breakthrough addition to a generator in a nuclear power plant, or a
futuristic warp drive or what-have-you, or just ARM's technology, you could
compete directly with the entity who developed the technology (or their
licensees) without paying the high patent costs.

How would this be dealt with? How can RPX keep from startups based on theft?

Wouldn't this be like offering "copyright infringement insurance" \- how would
you keep people from using it while actually violating the most valuable
copyrights?

[http://en.wikipedia.org/wiki/Perverse_incentive](http://en.wikipedia.org/wiki/Perverse_incentive)

[http://en.wikipedia.org/wiki/Moral_hazard](http://en.wikipedia.org/wiki/Moral_hazard)

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zyx321
Smells like a press release to me. Wouldn't surprise me if 90% if that article
were reprinted verbatim from a PR piece.

~~~
tesq
Given the increasing amount of PR pieces and fluff pieces fellating
multinationals (the Firestone ebola article, anyone?), I wouldn't be
surprised.

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kirillzubovsky
This is awful. Insurance companies are already printing money by "protecting"
people from all sorts of things that don't require protection.

As a business case though, this is brilliant. Buy up all the ammunition, then
charge your customers for protection. How's this allowed again? :(

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tesq
Phew, problem solved.

