Google Tries to Game Patent Law for Profit

Google Tries to Game Patent Law for Profit

Over the past decade, Google has gone from free market darling to an almost ward of the government.  The company, whose relationship with the Obama Administration is well documented has quietly grown its lobbying budget in Washington making it the eight largest lobbying shop in the nation’s capital. We now are getting a glimpse of what they are buying.

 As a bipartisan group of members of Congress, including Sen. Mike Lee (R-UT), seek to limit the damage of costly and frivolous “patent troll” litigation, Google has managed to insert a provision in the House version of the bill that allows them to reap profits from stolen patents.  

House Judiciary Committee Chairman Bob Goodlatte (R-VA) has introduced legislation called the “Innovation Act.”  The bill addresses the patent troll problem that is costing the economy billions of dollars a year.  Patent trolls are nothing more than lawyers who buy up unused patents, not for the purpose of innovating and creating, but for the purpose of suing. 

There are hundreds of examples of companies large and small who are hammered with legal “demand” letters asserting patent violations.  The letters are so vague they do not have to even detail what patent has been violated or how it has been violated.  In one case, a troll sent out thousands of demand letters requesting $1,000 because companies had purchased a certain scanner.  The cost of litigating the claim is certainly more than $1,000 so many just pay the bill and move on. This is costing the economy tens of billions of dollars a year.

Rep. Goodlatte’s bill would shift the cost of litigation from the defendants to the plaintiff’s.  The bill includes other needed reforms such as requiring entities to actually describe how their patent has been violated.  But tucked into the bill is a Google grab, a provision that would make it easier for companies to using inventors’ patented technology without paying for it. 

Under current law, those wishing to challenge a patent must invoke their rights within nine months of the patent being issued.  The America Invents Act of 2011 included something known as the “Covered Business Method” provision that gives certain financial services-related patents an additional 18 months to review a patent and the United States Patent and Trademark Office (USTPO) must examine the patent’s validity. 

Google now wants to extend the “Covered Business Method” to all business processing patents and allow the challenging of a patent at anytime for the life of the patent.  That would cover software and a host of other patents.  The provision also provides that enforcement of patent infringement would be delayed for 18 months, allowing infringers to profit for a year and a half without being forced to compensate the rightful patent holder. It’s free profits–and substantial market share for a company like Google– for 18 months from stolen goods.  It’s wrong.  

As Phyllis Schlafly and a host of other conservative leaders have pointed out, “there is no reason why innovators whose inventions are embodied in software should see those inventions treated any differently than an invention in any other areas of technology.”

Congress is taking the right steps to limit trolling litigation but should not allow those seeking to deny patent holders’ property rights to hijack the process to pad their bottom line.