April 21, 2016
Harvey R. Levenson, Professor Emeritus and former Department Head of Graphic Communication at Cal Poly State University, wrote The Printing Industry and Patent Trolls, on so-called patent ‘troll’ cases and their “negative impact”, which The Recycler reported on in March. Levenson followed this with The Patent Trolls Lose and the “Good Guys” Win One – The HQPI Cases Dismissed, in which he discusses how in one case, “the ‘good guys’ [have] won, and the patent trolls lost”.
He asks print service providers and OEMs to “pay careful attention” to the ruling, as it “demonstrates the wisdom of not giving in to greed and extortion”. In an “uncertain economy”, companies should “protect themselves”, and the printing industry “is particularly vulnerable”, because this can happen “not only from within” but “from competing media industries”, andthose “demonstrating unethical business practices”.
Patent trolls buy patents “and then sue another company claiming that the use of one of its products infringes on the purchased patent”, rather than any product or service being developed “upon the patents in question”. With “broad and vague patents” in their possession, ‘trolls’ can intimidate smaller, innocent companies with legal letters and threats of litigation.
Levenson highlights the decision as “amazing”, with HPQI, a shell company that forms part of ‘troll’ company Modern Universal Printing LLC, seeing “all of the lawsuits […] dismissed”. HPQI had “pushed for settlement” in every case against a range of providers and OEMs and was looking for six-figure amounts for “the right to use” its patents. While the cases could be refiled after a year, this is “highly unlikely because of the costs”.
Having seen the six-figure fee “rejected by nearly all of the defendants” before dropping to half, HPQI, “out of desperation”, dropped this to a “few thousand dollars”, but was rejected again, and with it speculated to be “being billed huge legal fees”, all of the existing cases “were dismissed”, though some companies had settled.
Levenson states that his previous article “was taken into consideration” by the judges, who now “probably” understand patent trolls “more than ever before”. He also communicated with RR Donnelley, which had held the patents before selling them, as the industry “was still sceptical” of its role in “supporting and benefiting from the trolls”, and received a statement claiming that the spokesperson was “not authorised to make any further statements”, but “appreciate[d]” the inquiry.
Levenson believes that this leaves the “sense of scepticism […] open” in regards to its role, but is optimistic that his work “inspired” it to “consider the position” and the “immense pressure” on “honourable” businesses. He aims next to include industry responses to the threat, and updates on cases involving CTP, another troll company.
The Recycler reported on numerous cases where OEMs spoke against patent trolls, with HP launching a petition in 2013 against MPHJ Technology Investments, which Ricoh and Xerox also challenged, filing an “inter partes” review request to prove that the scanning patent MPHJ was trying to enforce was not in fact patentable. Later in 2014, Canon and Google created an alliance allowing members to get a royalty-free license to patents sold by participating companies, in a bid to prevent infringement suits from patent trolls.
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