So immediately after publishing this entry about reasonableness of demanding nearly six figures for a non-exclusive license to a relatively simple (in today’s terms, at least) technology, I learned about recent comments by Chief Judge Randall Rader, who apparently referred to litigation (or at least a certain type of litigation) as “systematic blackmail.” (Source: Dr. Roy Schestowitz’s post over at Techrights, citing to Mike Masnick’s article).
Even though the statement appears to be qualified, it is still a rather biting comment, particularly since it comes from a federal judge who has presided over trials at least as recently as this past summer. Judge Rader’s point, is similar to my own in that the cost of the “fight” far exceeds what the seller is willing to accept, incentivizing the buyer to pay for a license without respect to the technical merit of the patent. The concern then is that the system itself could be abused to allow owners patents having zero technical value to extract license fees based solely on the transaction costs themselves. However, it is important to separate the ability to abuse the system in such a manner with its practice. Does abuse occur? Almost certainly. But those who want to can just as easily “find” abusive litigation where there is none, clouded by their own pre-conceived notions about claim scope or novelty.
More amusing, however, is Masnick’s claim that Rader is “ignoring reality.” Judge Rader correctly points out that the various scenarios and hypotheticals being thrown his way are mere anecdotal evidence, and not necessarily representative of reality. Masnick’s response to this observation? “[T]his is a very real situation that happens all the time.”