Although the issue is serious, it is not a hopeless one. Recent developments in both the United States and Canada offer some hope for companies on how to defeat patent trolls .

This past Spring, the US Supreme Court ��certioari for��Personal Audio v. Electronic Frontier Foundation, giving the Electronic Frontier Foundation (EFF) a firm win against patent trolls. The issue arose in 2013 when Personal Audio LLC sent letters to several podcasters and companies to force them into a licensing deal or face a patent infringement . Personal Audio held a for “a system for disseminating media content representing episodes in a serialized sequence” and claimed that this covered all forms of . Amongst the targeted podcasters was comedian , who was sued by the company for patent infringement and raised half a million dollars in a crowd-funded campaign to fight back. Although Carolla later settled, the issue was far from over.

In 2013 the Electronic Frontier Foundation (EFF) challenged Personal Audio’s patent with an “inter partes review”. Amongst their of contention, the EFF argued that the patent had a priority date of 1996, however, systems for delivering episodic content already existed on the internet well before this time. They gave examples like CNN’s “Internet Newsroom” and the Canadian Broadcasting Corporation’s show “Quirks & Quarks”, which operated on platforms that enabled episodic content but originated before the priority date. EFF was reportedly��successful in their challenge and the US Patent and Trademark Office invalidated the patent. This decision was later in the US Court of Appeal and the Supreme Court denied certioari.�� With EFF's firm victory over Personal Audio, this case will surely influence future cases regarding patent trolls.

Meanwhile, in April 2018, Canada announced its national IP strategy, which included amendments to key IP�� to combat patent trolls. Amongst the amendments is a new requirement for patent to include minimum standards of information, such as details on the specific patent being infringed and how it is infringed. This requirement is aimed at reducing vague or deceptive demand letters that are often used by patent trolls. Government officials also said the proposed amendments will give Canadian companies that are targeted by patent trolls the home court advantage in litigation, with any infringement claims made against Canadians restricted to Canadian courts.

Taken together, it seems that the opposition against patent trolls has made some headway, however, we will have to wait to see the lasting effects of these events.

Imtiaz Karamat is an IPilogue Editor and a JD candidate at Osgoode Hall Law School.

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In light of the quote above, the thought of demonic robot trolls may scare people into not reading the rest of this article as “ignorance is bliss”. However, it is not the fantastical, cave-dwelling version of a troll that this article sets out to discuss, but rather it is the familiar, to some “cave-dwelling”, non-practicing entity (NPE) that the patent community has come to know as a patent troll.

Although this introduction of NPEs may seem harsh, and I do not mean to offend anyone by it, NPEs have become such a frustration to other companies that the title has stuck. In fact, a study has shown that about two-thirds of all patent lawsuits in 2015 were filed by NPEs.[1] Furthermore, NPEs have become such a burden for businesses, the Supreme Court of the United States was inclined to step in and attempt to reduce the strength of NPEs.[2]

However, I would suggest that the issues surrounding NPEs and the magnitude of their burden may only be at an infant stage. When one considers the potential of artificial intelligence (AI) and the role it might play as an inventor, one may begin to realize why future NPEs could be far more obstructive than current ones.

For example, we can consider “Chef” IBM Watson to help us understand why we could be staring in the face of an NPE crisis. In 2014, IBM researchers teamed up with the Institute of Culinary Education in New 91��ɫ to use AI to create new recipes.[3] The idea behind this experiment was that Watson could determine novel food parings and recipes as it is capable of processing every possible combination of food whereas chefs have limited creativity and time. The researchers at IBM were correct and Chef IMB Watson was able to create new dishes, for example, Swiss-Thai asparagus quiche and Australian chocolate burritos.[4] These dishes being just two of what researchers think will be millions of more ideas that Watson will discover.[5]

Knowing that recipes are patentable subject matter, I hope that the issues that AI in combination with a NPE could cause are becoming clear.[6] If a NPE could obtain a program such as Watson, they could potentially be in possession of millions of patents to licence or litigate. Moreover, the entity does not need to be a NPE for this to be an issue; if AI is creating millions of “recipes,” there would necessarily be patented, or at least patentable, subject matter not being used by the practicing business.

This conclusion does however beg the question: “would the NPE be entitled to the patents generated by the inventive content created by the AI?” A question which has not yet been answered by the courts or through legislation. Although some have suggested that “a computer’s owner should be the default assignee of any invention”, this finding was not made with regards to an artificially intelligent empowered NPE.[7]

Therefore, I cannot say that “a computer’s owner should be the default assignee of an invention” or that this opinion is wrong in light of the concerns raised above. However, I can echo the quote above and say that, when it comes to AI, there needs to be regulatory oversight. In other words, NPEs are already negatively affecting the economy and innovation, and if you do not want to imagine a future where NPEs are armed with artificially intelligent patent generators, we will need new and proper regulation.

Denver Bandstra��is a JD Candidate at Osgoode Hall Law School and was enrolled in Osgoode’s Intellectual Property Law Intensive Program. As part of the program requirements, students were asked to write a blog on a topic of their choice.

[1] Joe Mullin, “Patent troll lawsuits head toward all-time high” Ars Technica (7 October 2015) online: <https://arstechnica.com/tech-policy/2015/07/patent-troll-lawsuits-head-towards-all-time-high/>.

[2] The Supreme Court of the United States ruled in TC Heartland that that a patent infringement case must be brought where the infringement occurred and not necessarily in the Eastern District of Texas. TC Heartland LLC v Kraft foods Group Brands LLC, 581 US __ (2017); Mike Montgomery “SCOTUS Smacks Down Patent Trolls” Forbes (2 June 2017) online: <https://www.forbes.com/sites/mikemontgomery/2017/06/02/scotus-smack-down-patent-trolls/#6215dc75ae4b>.

[3] Maanvi Singh, “Our Supercomputer Overlord Is Now Running A Food Truck” National Public Radio (4 March 2014) online: <http://www.npr.org/sections/thesalt/2014/03/03/285326611/our-supercomputer-overlord-is-now-running-a-food-truck>.

[4] Ibid.

[5] Ibid.

[6] Larry Tarazano, “Can Recipes Be Patented?” Inventors Eye (June 2013) online: < https://www.uspto.gov/custom-page/inventors-eye-advice-1>.

[7] Ryan Abbott, “I Think, Therefore I Invent: Creative Computers and the Future of Patent Law” 57 BLC Rev 1079 (September 2016) at 2.

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brought its claim after the Canadian courts revoked two of the company’s patents on the basis that these patents lacked utility. The courts applied “” to invalidate the patents on the basis that the patents lack . In ISA, �� argued that the Canadian test for utility of the patent is arbitrary “judge-made law” and thus constitutes a violation of Canada’s international obligations under NAFTA. The company advanced its challenge against Canada on two accounts. First, Eli Lilly claimed that the judicial interpretation of utility in Canada (the so-called “promise doctrine”) contradicts the meaning “capable of industrial application” under NAFTA, Chapter 17. Second, the company alleged that Canada’s utility standard has abruptly changed over the years. According to Eli Lilly, such “dramatic” change in the judicial interpretation of the utility standard is problematic because it violates Chapter 11 of NAFTA. Both arguments questioned the traditional role of the domestic courts in interpreting and applying the patentability criteria. Ultimately, Eli Lilly’s argument failed in ISA. In short, the ISA arbitrators concluded that failed to produce sufficient evidence to support its allegations.

For the Government of Canada, however, it may be too early to celebrate this victory. The reasons become evident after appreciating the context of the Eli Lilly’s claim. First, the Eli Lilly’s dispute lasted more than five years. NAFTA does not provide parties to a dispute with procedural mechanisms to dismiss the claims early, akin to the summary judgment or a failure to state a claim provisions in common law jurisdictions. Accordingly, NAFTA permits claims that may eventually lack any legal or factual foundations without providing an opportunity to ��curb such claims early to minimize the costs. Second, the tribunal did not explicitly address whether a change in the judicial interpretation of the state’s patent law can potentially violate this state’s international legal obligations, including those under IIAs. In practice, it means that the doors for claims similar to Eli Lilly’s remain open. The consequences are significant for states parties to ISAs. to defend the investment claims average at US 5 million dollars per one dispute. Losing such a claim is an even more expensive option for states for two reasons. First, the monetary costs may be substantial. For example, Eli Lilly demanded in damages. Second, losing a claim may result in reputational harm for a state as a potential destination for foreign investment. As a result, some states prefer a settlement of the dispute over facing a foreign investor in the ISA process.

These factors combined create a structure that encourages foreign investors to bring IP claims in ISA against states in hope to achieve a favourable settlement in a fashion similar to the “patent trolls”.�� The claims similar to Eli Lilly’s can become a tool for speculation. In particular, ��the claimants can allege that the states’ patent laws dramatically change and such change constitutes a violation of an applicable IIA. If an effective mechanism for the early dismissal is not available, a state has to defend its claim for a prolonged period of time and face substantial costs. Some states, however, lack financial or expert capacity to uphold such defence. From a policy perspective, the concern the Eli Lilly’s type claims may inspire foreign investors to file claims against states not to vindicate their property rights, but rather to use such claims as a bargaining chip to achieve profitable settlements. Such procedural use of IP rights (and particularly patents) fundamentally contradicts the purpose of the national IP systems that�� grant IP rights for the benefit of society and not merely “”.

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Elsevier is one of the largest science and medical publishers in the world. Prestigious journals, such as and , are amongst its products. Over the years, it has been the subject of a number of criticisms, including its pricing regime (see , and ), its strong stance against academics posting their own articles on university archives (see and ) and other platforms (see and ), and the sale of open access articles (see ).

On August 30, 2016, the United States Patent and Trademark Office granted Elsevier a monopoly over the “waterfall process” of online peer review. This is a process whereby, upon rejection, a different journal (chosen through a comparison of the submitted articles of the author and the published articles of the suggested journal) is suggested to the author for resubmission. The referral occurs automatically, and upon the author’s consent, the article is immediately forwarded to the recommended journal.

Since the patent grant, much of the commentaries have been negative. Many people immediately went on social media to express their shock and discontent. One of whether there is prior art to “online peer review”. The same person also expressed his that less resourceful entities cannot legally challenge this patent. Although in response in an attempt to calm fears, it was ineffective. The Electric Frontier Foundation rated it . on Scholars Cooperative compared this move by Elsevier to be similar to that of a patent troll. (Harsh!)

In an age where academic publication is trending towards open access, coupled with the criticisms of Elsevier’s anti-open access practices, the passionate anger from the public is understandable. However, as heated emotions calm, it is important to take another look at this patent more cool-headedly with two questions in mind: (1) is the patent valid and (2) what is its point if it is valid?

On the issue of validity, the commentaries focus on novelty. It has been pointed out that the waterfall process is what others refer to as “” and has been used by others prior to Elsevier’s patent filing. However, a closer look at the patent makes it apparent that Elsevier acknowledges that there are existing journal referral practices. Elsevier notes that what is lacking is a “more flexible and convenient” system, such as referrals to non-sister journals. Reading the patent holistically, it appears that the novel aspect of Elsevier’s invention is an improved and automated system of the online cascading peer review process. Examining the broadest claims, it is evident that they contain many elements, including the novel improvements on the cascading peer review process, thus making the scope of the patent narrow. Overall, it appears that this patent satisfies the novelty requirement.

The more interesting issue is whether the invention is truly “inventive”. In my opinion, expanding the cascading peer review process to non-sister journals and automating the process through computer programs seems rather obvious. However, not being a “person having ordinary skill in the art”, I am not qualified to make any judgments. It would be interesting to hear expert opinions on this issue.

Finally, assuming the patent is valid, is there any value in it? With all the criticisms Elsevier has been under and the boycott against Elsevier, this move was immediately perceived as hostile and anti-open access. Elsevier was compared to a patent troll because people imagine the publisher would use the patent to block out journals with less resources (especially the open access ones) by suing them for using a similar cascade peer review process. So in terms of company image, this move was damaging. However, considering the claims of the patent are very specific, it should be easy for others to work around the essential elements of the claims, making it hard for Elsevier to enforce the patent. Maybe Elsevier never intended to block out other publishing entities. Maybe Elsevier wants to generate revenue by licensing its waterfall process to other entities. If so, it should not be too difficult to work around the narrowly claimed invention. With the anti-Elsevier attitude many academics have, would other publishing entities want to license from Elsevier? If not, was the cost in money and public image of getting this patent worth it? We can only wait and see.

Sue (Zhonghui) Fei is a JD Candidate at Osgoode Hall Law School.�� Sue is currently enrolled in Osgoode’s Intellectual Property Law Intensive Program. As part of the program requirements, students were asked to write a blog on a topic of their choice.

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British Telecommunications (BT) alleges that��on-line services offered by Valve infringe on four U.S. patents held by BT. The patents at trial are broadly worded and could implicate many popular video game, social networking, and video streaming services. If [BT v Valve]��were to succeed,��they would be granted legal authority allowing them police many of the services relied upon by the video game industry, as well as many other popular websites.

David versus Goliath

Valve, founded in 1996, owns and operates ��Steam, an industry-leading software distribution and social networking application for computer gaming.��Steam, released in 2003, commands a near-monopoly over the digital rights management (DRM) and computer game distribution. Despite massive support among developers and gamers alike, ���ٱ𲹳�—a�Ի� �ղ�������—h������ .

British Telecommunications (BT) group is the oldest telecommunications company on the planet, tracing its roots to the invention of the first telephone by Alexander Graham Bell. BT is a leading communications provider in the United Kingdom. According to court documents, BT “,”��in network telecommunications.

What the suit claims

BT argued that Valve continued to operate services at great cost to the patent holder, despite multiple communications asking Valve to stop. The following patents are alleged to have been infringed:

• Communications node for providing network based information service:��

• Method for automatic and periodic requests for messages to an e-mail server from the client:��

• Communications network and method having accessible directory of user profile data:��

• Multi-user display system:��

One can��see��how Valve's services are implicated in these patents. Steam��is a digital marketplace that distributes “”; provides chat services “”; stores “”��for its users; and allows these users to “.”

Valve is far from the only company implicated by the broad language of these patents (and certainly not the most financially successful). Messaging, video streaming, and web marketplaces are endemic to the internet and the tech world. As the patent holder, BT has a choice to enforce the patent against whomever they wish. Why go after Valve?

Possible reasons:

1. This is intended as the first of many similar suits

If the court were to rule in favour of BT in this case—however likely that may be—it would open the door for further enforcement of the strict language contained by the patents-in-suit. If the court accepted the language that “BT has been damaged and continues to be damaged by Valve’s infringement,” and applied retributive, pecuniary damages, this would set a precedent allowing BT to challenge industry leaders’ social media and networking IPs.

2. BT is looking to become involved in gaming, DRM, or streaming

Video games are a multibillion dollar industry. Leading publishers and distributors, like Valve, command the industry’s continually expanding value. Social and competitive gaming services, like Valve's��Steam are at the heart of a parallel, expanding market for “e-Sports”. Video game “sport” tournaments have exploded in popularity and now host regular tournaments each year. Cash prizes range in the tens of thousands of dollars. It is not improbable that major telecommunications companies would keep an eye on this growing market. If BT had any interest in permeating the market, the ability to enforce this patent against Valve could pay serious dividends.

3. A suit against Valve will allow BT to test public opinion

Most computer gamers must interact with ���ٱ𲹳�.��As a result,����news related to Steam and Valve receives a great deal of attention. The video game consumer base is very large. An accusation against Valve is sure to gain the attention of a large audience, including many people who would not otherwise follow tech news. This is a known tactic within the video game industry to��lobby public opinion.��Kotaku.com has gone so far as to develop a separate ��news page to cover all of the grievances--material and superficial--raised against Valve/Steam.��Targeting Valve is a��sure way to determine if public opinion will allow BT to go ofter other, higher-profile internet services with patent suits (e.g., Facebook, Amazon).

What does this mean?��

Perhaps this can be dismissed as a "patent troll" case. But, granting patent rights to BT in this case might lead to controversial effects. The Trans Pacific Partnership (TPP) (albeit, with rapidly diminishing support). The TPP would permit greater US-based regulation of the public internet. If this were ratified, a decision like that in BT v Valve would support and legitimize BT and the US government's policing of many of the most popular applications and resources on the internet.

Further news related to the suit will follow in the coming months.

Christopher McGoey is an IPilogue Editor and a JD Candidate at Osgoode Hall Law School.��

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On September 24, 2013, US District Judge Rodney Gilstrap of East Texas ��Apple’s , filed two years ago in 2011, as a defendant-intervener in the action against Apple’s app developers for alleged patent infringement. In the , Lodsys claimed that small-time iOS app developers were infringing the firm’s patents by using technology such as in-app purchasing and feedbacks surveys, without paying a licensing fee. In other words, Lodsys contended that it underlying some of the most basic app functions across mobile operating systems, namely iOS and Android.

Apple’s motion to intervene was recently dismissed on the grounds that the developers had already with Lodsys and as such, Apple’s arguments were moot. However, the arguments may still be made in a subsequent action, should the occasion arise. Apple had also filed an opposition to Lodsys’ motion to dismiss, which can be read .

The motion to intervene was right at the heels of Lodsys’ suit, back in 2011, against the app developers, who were understandably relieved to have Apple's support in the litigation. Prior to Apple’s attempt at intervening, Senior Vice President and General Counsel Bruce Sewell sent an usually detailed to the CEO of Lodsys, Mark Small, outlining the lack of merit in the latter’s claims against Apple. While the letter did not prevent Lodsys from commencing litigation, it clearly expresses the tech industry's position with respect to patent infringement litigation commenced solely for pecuniary ends.

It is not surprising that Sewell might have wanted to say a little more than required to Lodsys in his letter. Lodsys is based in East Texas, which is a jurisdiction now infamous for rulings friendly to “.” These shell-companies do not create any products. They exist solely to threaten patent litigation in hopes of a quick and relatively low settlement by targeting companies that will pay out to avoid protracted litigation. In addition to Apple, Lodsys has also brought patent infringement actions against��, , and most recently, (“Martha Stewart Living”), amongst . Patent trolling has become an effective means to a fast settlement.

In Canada, patent trolls are few and far between, but (“Dovden”) is already a name that might make a developer shudder. Dovden has filed 32 lawsuits in Canada just this year. Recently, Dovden withdrew a suit against a bus app developer originally filed at the Federal Court demanding $10,000 in licensing fees. Perhaps the Federal Court has less of a stomach for such claims. In the United States, Vermont has enacted legislation to address the issue of patent trolling - Bad Faith Assertions of Patent Infringment. (For more information on this patent trolling legislation, see my article .) In Canada, however, no legislation yet exists to address this emerging issue, although sanctions do exist for bringing meritless claims.

While Apple is temporarily out of the arena, Martha Stewart Living, as mentioned above, has joined the fight against Lodsys, which claims that the Martha Stewart Weddings iPad app infringes its patents. Martha Stewart Living has filed a �� and will be taking the battle home to East Texas, where it all began. Furthermore, Lodsys’ bark might be worse than its bite. When faced with the possibility of real litigation on potentially meritless claims, Lodsys opted to ��in the suit against Kaspersky Lab.

Ying Cheng is an IPilogue Editor and is in the BCL/LLB program at the McGill Faculty of Law in Montreal, Canada.

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The modus operandi of a P.A.E.,��such as��IPNav, is not complex: it is a company that acquires (usually temporary) rights on a batch of patents from different rights holders.�� After identifying companies that are��allegedly using these patents without authorization��from the patent holder, the P.A.E. will attempt to monetize its patents by charging licensing fees or threatening (and sometimes engaging in) costly lawsuits.

These practices��have been����by the media and society because P.A.E.s themselves do not commit any investment in the innovative process and��the legal arguments��used to support the rights claimed by the P.A.E.s are, in many cases, weak. In some instances, even if a patent has not actually been infringed upon, a company that receives notice by a P.A.E. may��consider it worthwhile to pay licensing fees in order to avoid the threat of further costs and time spent in a possible lawsuit. It is not a coincidence that the main targets of P.A.E.s are such as Amazon, Oracle, and Citigroup - businesses of higher net worth that may be willing to pay more in response to such claims. For these reasons, P.A.E.s are often referred to as “patent trolls.” A by researchers at Boston University School of Law reveals that the activities of patent trolls in 2011 cost approximately US$ 29 billion for “trolled” companies.

Due to these business practices, P.A.E.s are often cited as the enemy of innovation.�� The President of the United States, Barack Obama, in February 2013 that patent trolls exist to extort money and do not contribute to innovation, and that legal reform is needed to prevent the misuse of the patent system. In June 2013, the White House major steps to improve incentives for future innovation in high tech patents by . These steps include executive measures, such as tightening functional claiming and strengthening the enforcement process of exclusion orders, and legislative recommendations, such as requiring patentees and applicants to disclose the real party-in-interest, permitting more discretion in awarding fees to prevailing parties in patent cases, and protecting off-the-shelf use by consumers and businesses.

P.A.E.s, however, claim to represent positive forces for innovation. P.A.E. owners often argue that their activities��are very important to , who��may��not have the organizational and financial structures necessary to enforce their exclusive patent rights. Through the support of P.A.E.s, small inventors can obtain appropriate compensation when their patents are��infringed by third parties, encouraging them to invest more time and money in new innovations. Furthermore, Erich Spangenberg emphasizes that entities like IPNav can also help large innovative companies monetize their patents, encouraging future investments by these companies in new technologies.

It is important to note that not all lawsuits filed by P.A.E.s are abusive or lack reasoned legal grounds. The P.A.E., IPCom, was successful in against the German company Deutsche Telekom and indirectly contributed to compensating inventors of the infringed technologies. From this perspective, P.A.E.s acting in accordance with ethical and legal standards actually by small inventors and large companies alike.

In this blog, and opinions about the activities of P.A.E.s have been reported, reflecting the contrasting positions held by the media and legal critics. This is also indicative of the fact that this topic will be open for continued discussion and debate. Currently, there are no specific legal provisions concerning these entities at��the international level, causing considerable legal��uncertainty.

In my opinion, considering all P.A.E.s as enemies of innovation and banning them indiscriminately is not compatible with current commercial practices, nor is it a way to promote innovation.�� It is a common occurrence that the direct economic beneficiary of an intellectual property right is not necessarily the inventor or creator per se, but a third party who has acquired these rights (e.g. copyright enforced by music publishers, patent rights enforced by large technology companies). The practice of assignment and transfer of patent rights is expressly allowed under . In principle, therefore, the activities of P.A.E.s��are not necessarily illegal or disadvantageous to society.

In fact, P.A.E.s only become a problem for development and innovation when they misuse patent rights, abuse procedural requirements, or threaten companies into settlements based on non-existent infringement. In such cases, bad faith actions of patent trolls have to be identified and punished by the courts on a case-by-case��basis. General and indiscriminate prohibition of P.A.E.s would achieve these goals but at the same time eliminate the benefits that these entities provide. Indeed, it may be that other areas of law and current policies need to be changed in order to��eliminate the misuse of patent rights. The importance of high-quality patents for avoiding patent trolls has been expressly by the European Commission - granting patents for imprecise and ambiguous claims lead to misleading interpretations on the scope of a patent and facilitate abusive practices.

Any current abuse of rights by patent trolls also reveals the major flaws in patent litigation procedures. Due to the high cost of litigation, extensive length of proceedings, legal uncertainty in the area of patents, and the risks of granting preliminary injunctions, companies are more apt to settle when faced with a claim from a patent troll�� - even if the claims lack a strong foundation.�� Reforming procedural law as it relates to patent litigation��should also be reconsidered by legislators in order to avoid potential abuse in the future.

In conclusion, the activities of P.A.E.s, when performed under ethical standards, are valid from a legal perspective and can actually support the innovative activities of both small and large companies. Instead of outright prohibiting P.A.E.s, the most reasonable solution would be to identify and evaluate abusive lawsuits filed by P.A.E.s on a case-by-case basis. Furthermore, requiring Patent Offices to engage in a more thorough analysis of patent claims before granting intellectual property rights and effectively reforming procedural laws may help to prevent the proliferation of abusive patent trolls.

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In 1996, Jim Logan received a for a personal audio device that would allow users to select and download audio tracks for offline enjoyment. Personal Audio eventually launched a service where users could receive cassette tape audio recordings of magazine articles on demand.�� The company has not released a product in 15 years, yet, Personal Audio received a continuing patent in 2012 and was successful in a patent infringement suit against Apple for . Apple appealed the ruling and later settled for an undisclosed amount.

Personal Audio is now going after individual podcasters with against NBC, CBS, ACE Broadcasting and HowStuffWorks.com. Logan says that his company will not go after smaller podcasters, but several individuals, including comedian have reported receiving letters from Personal Audio informing them that their activities infringe Personal Audio’s patent. The activities of Personal Audio have led several critics to label the company as a "patent troll."

Logan sees nothing wrong with allowing a patent holder to come forward and claim infringement on a product that they did not manage to bring to market. His claim is that he put $1.6 million into development and his only remaining asset from the venture is the patent itself. This is part of the allure of the patent - that even when a product is unsuccessful, an individual may still be able to get a return on their investment when another entity wants to licence the patent and "try again." The argument remains that patents provide incentive for innovation through the economic rights related to the intellectual property covered by a patent.

In 2012 Logan obtained a continuation patent��and was able to succeed against Apple.�� This is one angle from which others might attempt to challenge the patent’s validity. Canada takes a restrictive approach to patentability and does not have continuing patents. In my opinion, it is doubtful whether Logan’s original patent would hold up under opposition under the Canadian patent system, as he would not have had the same ability to update it to reflect the ways in which the technology developed. Although purposive��construction of claims��can blur Canadian patent parameters, the lengthy review process makes it less likely for a patent to pass basic threshold tests when challenged in the Federal Court.

Canada also has procedural safeguards in place that would affect how defendants may choose to proceed against a patent troll. Canadian courts are reluctant to award interlocutory injunctions in patent infringement cases, which limits the ability for patent trolls to threaten an injunction to force a settlement at an early stage in the proceedings.

When threatened with patent infringement, alleged infringers have to make a choice - defend against the claim at a substantial financial cost (with no guarantee of "winning") or attempt settling to avoid court costs and an extended time in litigation proceedings. In Canada, a lack of interlocutory injunctions and the possibility of costs awarded to successful defendants provides an incentive to defend against a weak claim.

One suggestion to combat patent trolls has been discussed by Professor Cameron Hutchison of the University of Alberta, who proposed using the concept of�� in property law to deal with companies like Personal Audio. This idea would require patent holders to commercially develop their invention. If a patent holder does not bring their invention to market within a specified time, others could use the defence of "adverse possession" when a patent holder comes forward to claim infringement.�� This may also curb the registration of over-broad patents that are able to encompass future technologies, as is the case with Personal Audio.

This latest string of suits could be the straw that breaks the camel’s back for patent trolls in the United States. ��against Personal Audio for what it calls “a classic example of an over-broad software patent”.�� EFF, along with Harvard’s Cyberlaw Clinic, and few vocal podcasters have put out the call to challenge the validity of the patent and demand legislative reform.

Allison McLean is an IPilogue Editor and a JD Candidate at Osgoode Hall Law School.��

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The main issue of the dispute is concerning Microsoft’s use of the H.264 codec for video recording, compression and distribution. It is one of the most commonly used formats in the computing industry and used almost ubiquitously for all high definition video. Microsoft uses the codec in a number of the programs PC-owners use on a regular basis (such as Internet Explorer and Windows Media Player) and within its gaming system – the Xbox 360.

A Mannheim, given in late April would have the effect of instituting a ban on sales of Microsoft products such as Windows 7 and the gaming console. Currently, Motorola has been unable to institute the sales ban due to another lawsuit between the two companies that is being conducted . Not long after the German ruling, the US International Trade Commission that was also hearing the matter and has recently determined that the patents had been infringed by Microsoft. Following the decision, Judge David P. Shaw of the ITC has on the infringing products, a decision that could have huge implications on the profits of the tech giant. Microsoft still has some breathing room as the on to both the ITC board of commissioners and the Obama administration.

During the proceedings, that Motorola’s approach to licensing the codec did not follow the FRAND (fair, reasonable, and non-discriminatory) principles – guidelines that are applied in order to promote healthy and competitive markets worldwide. The nature of many products requires the use of industry-standard technologies – the patents to which must be licensed at reasonable rates to allow other companies to compete. Issues will begin to arise when the companies that own these patents begin to abuse their position.

As a result of a number of lawsuits concerning similar issues between tech companies, Jon Leibowitz – Chariman of the Federal Trade Commission, that the FTC will likely look into injunctions issued over the use of standard and essential patents. These investigations would likely relieve Microsoft in the interim of a sales ban, and would at least provide some time to deliberate with Motorola on a reasonable licensing fee for the infringed technologies. During the ITC hearing, that Microsoft should make a royalty payment which would amount to roughly $4 billion annually.

Many lawsuits have arisen in recent years due to the growing market share of smartphones and technological devices. Patent rights were developed to spur innovation, but as the tech giants like Google and RIM have padded their patent portfolios through acquisitions and mergers, the trend seems to be moving towards patents as a means to attack other companies and reduce or eliminate competition. While I hope that Motorola is not attempting to abuse their position of patent power, they should keep in mind that there is a fine line between utilizing patents to protect innovation and using them to gain an unfair advantage in business dealings.

Adam Del Gobbo is a JD Candidate at Osgoode Hall Law School.

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I believe that one quote concisely delineates the behaviour of patent trolling:

Amongst a host of dormant patents, some will be found which contain new principle…which the inventor, however, had failed to render of any use in his own invitation.�� And some other inventor, ignorant that such a principle had been discovered…had the genius to render it of great practical value…when, lo! the patent sharks among the legal profession, always on the watch for such cases, go to the first patentee, and for a song, procure an assignment of his useless patent and at once levy blackmail upon the inventor of the valuable patent.�������� –United States Senator Isaac Christiancy

Similar to the troll of Norse mythology, protecting their unproductive land and devouring those who unknowingly trespass, patent trolls impede those who travel in the realm of invention.�� The Nordic troll maims their unsuspecting prey with giant clubs, while the patent troll typically uses ambiguous patents to subdue their victims.�� It is these non-practicing entities that create more obstacles for inventors and subsequently increase the costs of inventing.�� Consequently the incentives to invent are diminished.

Patent trolls increase patent costs in multiple ways.�� Firstly, the risk of exploiting a new device due to lurking patent trolls whose sole purpose is to claim damages if an infringement occurs, is substantial.�� The heightened danger of traveling in the realm of invention causes difficulty for the small inventor to exploit their ideas and more importantly obtain the support of investors who cannot withstand heavy litigation fees nor pay large damages if required.�� The potential for large settlements in favour of patent trolls is illustrated by the $612.5 million awarded in settlement to NTP Inc., a registered “patent-troll” when they filed a claim against RIM for providing its blackberry services.�� Further studies have shown that patent trolling has cost publicly traded companies approximately $500 billion.�� Once news of an infringement claims against publicly owned company’s reaches the public shares tend to plummet in value.

Secondly, hiring guardians to shield against patent trolls can be quite costly.�� Patent purchasing groups such as Allied Security Trust (AST) purchase patents so they will not fall into the hands of a patent troll.�� Typically organizations such as AST purchase the rights to inventions that can be asserted against the members of the organization.�� The issue with the AST’s of the world is that they are an exclusive club with a high membership fee.�� AST charges a membership fee of $250,000 and requires a $5 million deposit in escrow to fund patent purchases.�� Many investors cannot afford the protection afforded by these ‘knights in shining armour’ and the ones that are able may feel that the cost-benefit balance no longer works in their favour due to the increased costs of patent protection.

The costs associated with invention are inflated due to the increased risk created by patent trolls.�� The costs are increased further by the measures required to guard against them.�� This essentially curtails the benefits of invention as well as the incentives for inventiveness.

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