06 April 2017
Brussels
Reporter: Barney Dixon

Patent trolls on the rise in EU, says coalition


European courts are facing an “explosion of patent infringement lawsuits from so-called patent trolls”, according to advocacy coalition IP2Innovate.

The coalition, which counts Google, Spotify and Intel as members, claimed ‘trolls’ make up a “staggering 20 percent” of all patent lawsuits in Germany.

IP2Innovate describes ‘trolls’ as patent assertion entities (PAEs) that produce no products nor offer any services.

“They buy up patents, often of poor quality, and use the shortcomings of the legal system which enable them to force companies to accept high settlement payments,” according to a IP2Innovate spokesperson.

According to a study by Darts IP, which was cited by IP2Innovate, most of these cases were filed in the District Court of Düsseldorf in Germany.

Patent trolls have made Europe their new stomping ground, said the study, with the continent attracting more than 80 percent of their lawsuits outside of the US. The majority are filed in Germany and France.

Patrick Oliver, executive director of IP2Innovate, also identified the Unified Patent Court (UPC) as a cause for concern, as it could be an “attractive venue for patent abuses”.

“The European Commission must get tough with US patent trolls.”

A spokesperson for the group said that the UPC creates “an open invitation to PAEs”.

“The threat of an EU-wide injunction is a powerful weapon, and the UPC hands PAEs exactly such a weapon.”

“The UPC also offers other attractions to PAEs: they will have more time to prepare for the case than the defendant and they will be able to choose the ideal venue for the hearing.”

The coalition has been in discussions with the European Commission over possible action.

It is encouraging the European Commission to carry out a “fact-finding exercise to better appreciate the scale of the phenomenon of PAEs in Europe”.

“This could include a possible public consultation where companies targeted by PAEs could anonymously share data on the level of PAE activity in Europe (ie, number of letters received, settlement payments and lawsuits).”

In response to a letter from Oliver, Andrus Ansip, vice president of the European Commission, wrote in February that the issue is being “regularly discussed” across commission services.

On the subject of the unitary patent system, Ansip said the European Patent Office (EPO) would grant any unitary patents and that it is “recognised worldwide as one of the most demanding patent offices when it comes to the grant of patents”.

But he added that if the quality of specific patents should ever be in doubt, then the opposition procedure at the EPO, as well as decisions of the UPC, could overrule patents granted incorrectly.

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