Reporter Ashby Jones of The Wall Street Journal this week highlighted a controversy surrounding a long-standing practice to leverage the profitability of patents regardless of how or whether those patents are being used by the owner. We read this story with great interest as we happen to know a thing or two about intellectual property issues.
The question of why the Journal chose to explore this story in the first place is interesting to consider and has everything to do with the power of communication.
Non-practicing entities (NPEs), or “patent trolls” as they are often referred, are companies or individuals whose sole purpose is to enforce or assert patents and patent infringement claims against other companies without having a manufacturing or research base of their own. They’ve long existed and, as one expert mentions in Jones’s article, are often viewed as a drain on the economy because of their lack of innovation. Others suggest that they’re merely protecting what is legally theirs.
A less reported practice is the crux of Jones’s article, which profiles two elite lawyers, John Desmarais and Matt Powers, who made it their goal throughout their careers as patent-defense litigators to brand these plaintiffs as “trolls” and have now jumped the proverbial ship (in this case, law firms Kirkland & Ellis LLP and Weil Gotshal & Manges LLP) to work on behalf of these NPEs.
At first glance, “When Lawyers Become Trolls” is a story about reputation management and exploiting market opportunities. But it also speaks directly to the importance of language, labels and effective messaging.
The legal industry shrewdly developed and cultivated the “patent troll” label until it became a natural part of the legal lexicon. The label had staying power because of its emotional punch and the vivid imagery it produced. It aided corporate clients in painting NPEs as exploitative and unproductive.
In fact, according to a Wikipedia entry on the term, “patent troll” was initially coined in 1994 in “The Patents Video,” which was sold to thousands of universities, governmental entities and law firms as a way to educate them on critical information and commonly misunderstood concepts about patents. In the video, the “patent troll” is strategically positioned to collect patent licensing revenue, unbeknownst to his “victim.” The term gained further popularity in 2001 when Intel’s former assistant general counsel, Peter Detkin, used it to describe the entity, TechSearch – at the time, Intel was defending a patent suit against them.
How do lawyers who have battled “trolls,” a label they helped create, reshape the largely negative reputation these NPEs have? The answer is they may not have to, and perhaps that perception should be reevaluated. The legal industry is trying to bounce back from a few of the toughest years in its history and is in the process of reinventing itself. These lawyers seem to be ahead of the curve in finding new ways to apply their talents to serve clients and prosper.
We’ll likely see this trend continue as companies (both practicing and non-practicing) snap up patent assets by the thousands. It will be interesting to observe whether or not the reputational damage caused by the “troll” label seeps into the courtroom as NPEs gain more sophisticated legal counsel and become more aggressive in their enforcement.
In this economic environment, you never can tell when today’s “troll” might end up being tomorrow’s “client.”