EDITORIAL: The trouble with trolls

Patent-reform proposal takes a baby step in the right direction

With time running out on this year’s congressional session, leaders are anxious to find something, anything, that they can tout as an accomplishment back home. With little good news on the budget and taxes, the House will try its hand at getting something done on legal reform.

The House is scheduled Thursday to take up a measure from Rep. Bob Goodlatte, Virginia Republican, that’s supposed to thwart patent trolls. Unfortunately, the measure won’t generate much enthusiasm. Established interests have a habit of fighting against good ideas so fiercely that by the time a bill reaches the floor, it often loses the best elements.

Most agree that something should be done about the Patent and Trademark Office’s nasty habit of granting patents for trivial discoveries. Google, for instance, obtained a patent two years ago for its “doodles,” which is the term the Web search giant uses to describe alterations to the company logo that reflect “a periodically changing story line.” In other words, another company that puts a Christmas wreath around its logo in December or adds a pumpkin in October could be slapped for infringement.

Google’s not likely to enforce this silly patent, but unscrupulous lawyers have no problem taking advantage of this broken system with lawsuits designed solely to coerce a plump out-of-court settlement check. The Government Accountability Office studied the phenomenon and found patent troll lawsuits are on the rise. According to the agency’s August report, one out of five patent suits were filed by companies that don’t actually create or sell a product. Ninety percent of these were related to software, not physical items.

The lawsuit problem isn’t even limited to trolls. Major cellphone manufacturers, for instance, have found themselves in a courtroom arguing for hours on end about whether a rival “copied” the telephone icon on a smartphone screen, because one tiny picture of a phone looks like another tiny picture of a phone. Law firms love trivialities that translate into billable hours, but the time and effort wasted make products more expensive and less innovative for consumers.

In an ideal world, the bar should be raised for what qualifies for patent protection. Too often the phrase “intellectual property” is thrown around as though holding a patent or copyright were the same as owning a plot of land or the title to an automobile. Real property rights don’t expire, but the Constitution says patents and copyrights must be “limited” so that the sciences and arts can flourish. Right now, more limits are needed.

The House bill takes a step in the right direction with a “loser pays” provision that would punish the filing of frivolous lawsuit designed to land a settlement. It’s a complicated issue with no easy fix, but there must be some faith that a judge and jury is going to recognize the difference between a huckster and someone who truly contributes to society.

“Loser pays” will almost certainly be a sticking point in the Senate, where the Democratic majority will want to protect the trial bar by eliminating any hint of tort reform. The Senate must overcome the urge to cater to this established interest and work with the House on a compromise that imposes sensible patent limits.

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