Has the Enemy of Patent Trolls Become One?

By CIOinsight  |  Posted 12-05-2005

In 2001, when he was assistant general counsel at Intel Corp., Peter Detkin famously coined the term "patent troll" to describe firms that acquire patents only to extract settlements from companies on dubious infringement claims. Today he is a managing director of Intellectual Ventures LLC, a Bellevue, Wash., firm some observers fear is itself a troll—on steroids. IV is a patent holding company with a war chest estimated at up to $400 million; for five years it has been acquiring thousands of patents.

Founded by Microsoft Corp. alumni Nathan Myhrvold and Edward Jung, the firm is reportedly backed by a cadre of tech giants including Microsoft, Sony Corp., Nokia Corp., Apple Computer Inc., Intel, eBay Inc. and Google Inc., each of which gains a nonexclusive license to the firm's patent portfolio. The fears and speculation stem, in part, from the cloak of secrecy the firm maintains.

Detkin recently spoke with CIO Insight about his "invention company," business-method patents and the definition of "troll."

CIO INSIGHT: Why patents?

DETKIN: We think there is a good business model around invention, and that's what we're focusing on. As for their defensive or offensive potential, that's not the way we're looking at it. We look at is as: Are these inventions good investments? Just like any other business, we want to invest where there's money to be made.

How do you plan to commercialize your inventions?

I wish I could tell you exactly what our business model is. I'm not being coy with you when I say that we haven't settled on one. But the fact is—and we've had screaming matches as we've worked through some of our options—there are a lot of options available to us. For example, spin-outs and commercializing, or licensing to ensure that these inventions are available to others, are all possibilities we are exploring, both on our own and working cooperatively with others in the industry.

Does your portfolio include business- method patents?

We invest in a broad range of inventions and a broad range of technologies. Among them would be business methods.

In allowing business-method patents, have the courts and the Patent Office created a monster?

At the end of the day, I think the discussion of business-method patents is a bit misguided. I don't think people would object to patents on things that are really inventions, regardless of whether they fall into a business-method category. But I don't even know what the definition of a business-method patent is anymore. What I think most people are up in arms about is the fact that things are being patented that aren't really inventions. And that gets to the issue of patent quality. Is the Patent Office issuing patents it shouldn't issue? Is the Patent Office overburdened? That is the question I really think we should be focusing on. Not whether business methods should be patented. Because contrary to popular belief, nobody's patenting the supermarket anymore.

Some people consider a "patent troll" to be any person or business that doesn't produce a product or service, but instead makes money from licensing and patent assertion primarily. Has the definition of the term you coined, "patent troll," changed since you coined it?

At best, I would say it's become a little bit more refined. My concern is that the term has now been used so broadly as to mean any plaintiff you don't like. Look at the definition you just used. Under that definition the University of California is a troll, Intel's a troll—and since I was at Intel at the time, Lord knows I wasn't trying to call myself a troll. But Intel routinely asserts patents—that it bought, that it's not practicing—against others, looking for money. IBM would be a troll. Thomas Edison would be a troll. —R.G.

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    Q&A: Has the Enemy of Patent Trolls Become One?