SHIELD Act: a bill to stop patent trolls

Rob, the host of Podcast411, says:

A patent troll is out to kill off podcasting, or at a minimum critically wound it. This troll does have a patent on the whole podcasting process, despite the fact they have not contributed one line of code to the process or even a single idea used in podcasting. But they have a patent and they are going to suck as much money from podcasters as possible.

That they were granted this patent in February 2012 just goes to show how broken the patent system is. They have already started suing podcasters in the Eastern District court of Texas - where all patent trolls go to do their evil deeds. They also started sending out letters to individual podcasters looking to extort license fees. If you listen to podcasts it is likely at some time in the near future one or more of the podcasts you listen to will be hit with one of these extortion letters. There is actually a really good chance one of the podcasts you listen to already has -- four podcasts I listen to on a regular basis already have been sent these letters.

The podcasters that get these letters have 3 options.

1. Ignore the letters and hope for the best.

2. Contact the troll and agree to pay a license fee for the patent (even though the podcasters don't use the technology covered by the patent).

3. Fight the troll in court.

Well actually there is a 4th option -- shut down the podcast and delete all files and hope they go away. But even if podcasters do that the patent trolls could still try to extort money retroactively. But at least podcasters would not be out more money. Sadly many may choose this option.

Regarding option 3: If someone does fight the troll and wins - all that means is the winner does not have to pay the license fee to the patent troll. However the "winner" is still out all the lawyers fees they spent to fight a bogus patent.

Thus given the choice of paying around a thousand dollars a year (I have no knowledge of what the patent troll in this case is asking for -- that number is just similar to what some other patent trolls have asked for) or paying over $250,000 or even a $1,000,000 in legal fees -- game theory dictates you choose paying the license fee. The patent trolls know this and that is why their extortion racket works.

But now there is a real chance to change things. The SHIELD Act (H.R. 845) was just introduced into the House by Congressmen Peter DeFazio (D-OR) and Jason Chaffetz (R-UT). This bill would put the financial liability on the patent rolls if they loose. If the SHIELD Act is passed into law and you fight a patent troll and win -- the patent troll is responsible to pay all of your legal bills.

The EFF is strongly in favor of this bill and has set up a page to help you take action. Once there put in your Zip Code. It will then give you the names and phone numbers of your representatives in Congress and allow you to send an email to them. In addition to sending an email -- what is really important is to call your congressperson's office -- give them your name tell them you are from their district and you want your congressperson to support this bill.

This bill is definitely not a Republican or a Democrat Bill - nor is this a podcasting bill - this is at its heart an anti-patent troll bill. Patent Trolls are attacking Wifi at coffee shops, Scanning documents at small businesses, and now podcasting. They must be stopped and you have a chance right now to help out.

I hope some day when the whole sad story of Patent Trolls is finally written - the turning point will be when they went after Podcasters and the Podcast listeners helped get the SHIELD Act passed into Law


Stop patent trolls. Support the SHIELD Act.


  1. Sounds like a good idea, which would mean it has just as much chance of being enacted as a revised version authorizing construction of a helicarrier.

  2. I have to plead ignorance because of curiosity: why Eastern Texas? I assume the district is somehow favorable to trolls in patent claims. Is it because of state laws? (And wouldn’t that apply to all of Texas?) Is Texas some kind of Delaware for patent litigation, or is it just something about the judges who happen to sit in that district? Like I said, can’t help being curious.

    1. NPR’s ‘This American Life’ and Money Podcast did a piece on this exact same thing, why all of these patent cases wind up in East Texas. If memory serves it’s because of numerous factors, chief among them is that the Federal courts there didn’t handle the volume of cases as the other courts did. The patent cases could reach a resolution in a matter of a year instead of being delayed for years because of a full docket. Yes, there’s more to it than that but that’s the chief reason why the cases started to be filed in East Texas.

    1. Its just you dude. Whenever important or interesting issues are brought up, focusing on typos rather than the issue at hand is at best an annoying distraction. 

      1. So what, we’re supposed to forget about and excuse all grammar mistakes because something is “important” or “interesting”…?? LoL OK dude. It’s a shame I spell-check my important reports… or my important work emails… I should probably stop doing that!! People who catch my mistakes will just be generating annoying distractions! Get real dude. PXL makes a good point, and is not attempting to detract from the issue at hand. He’s simply making an observation, and asking a question.

        1.  Yes,  but is the question salient to the issue being discussed or is it, as Bruce Horn says, a distraction?

          It is a distraction.

          I seriously thought you were being sarcastic after your first sentence — I thought to myself “Yes, if someone is making a great point in context the grammar and spelling don’t detract from that in the least.”  I was honestly surprised when you went on to say no, grammar and spelling are totally as important as the content of an argument.

          It is a bizarre position.

  3. Its one step forward, sure a good thing. But people harassed by trolls still have to do a lot of work, going through court, with the uncertainty about winning or not, that alone can destroy health and psyche. A better solution would be to fix the damaged patent system. All those web patents in reality are worthless, they are not real inventions, not worth of any protection. Why do thousands of harassed private people have to pay the price for a completely failed patent system? Makes me sick.

    1. Simple solution:

      If the patent office grants a totally bogus patent, then they are (shock horror) responsible for any litigation that is the result of said bogus patent. i.e. if someone needs to pay to fight against the incompetence of the patent office, then the patent office foots the bill.

      Professional liability shouldn’t become void just because it’s a government agency.

      1. That’s the ticket, Mr. Hornsby.  But the rub is patents stop at the borders.  “International Patents” are weak.  So all of this is silly business anyways, and a distraction from the real issue, which is supporting fearless innovation.

      2. The only silver lining to this idiocy is that it’s patents and not copyright. Patents die after 20 years. (Yea, there’s pharmaceuticals who get them renewed because of some breakthrough with an old drug, but still ~ 20 years.) If all of that computer code had fallen under copyright protection we’d be royally screwed.

        1. However, copyright covers only the “text” itself, not the function of the text. Computer code used to be covered under copyright, rather than patents, and there weren’t “trolls” like this, because unless you could prove that code was literally copied from program to program, you didn’t have a case.

          Two different bits of code that accomplished a similar function weren’t (as I understand it, per This American Life’s coverage) a basis for litigation. Now that code is patented, like a machine/invention, affording such vague functional descriptions as “patent for a system where user clicks on an image,” the system is much more open to abuse, and completely independently developed systems can still be harassed if they are functionally similar, in some broad way, to a patent.

      3. This is fabulous in theory and would be disastrous in practice.

        If this were actually implemented, patents would simply never be invalidated, except in cases of willful malfeasance by patent officers. Judges would raise the bar enormously and obviously the patent office would choose to stop reexamining patents entirely.

  4. General Q: Whatever happened to “prior art”?

    Specific Q: How can a non-US citizen support this bill without compromising it? Donation to the EFF?

          1. The patent in question appears to have priority to Oct. 2, 1996. Can you find a reference (or combination of refs) related to podcasting that is prior to that date? Find it and you (or someone else) can invalidate the patent, after paying more fees, of course.

          2. I don’t know the specifics of this case – but Wikipedia seems to answer your questions:

            Having to pay to invalidate someone else’s bogus patent due to a mistake on the part of the patent office isn’t really a suitable solution though – in fact it’s pretty stupid.

            Also, are you saying that they filed a patent application in 2012 for something they claim to have invented in 1996? Is this something the US patent system allows? Because that’s even more stupid.

          3. Nathan:
            I wouldn’t say it is stupid-  it is actually a very nice option for someone completely unaffiliated with the case in question to challenge the patent outside of the courts. But I agree that it would be best if the PTO examiners did the job right in the first place. Keep in mind that somebody has to do the work (evaluating/analyzing/etc.), hence fees. Also keep in mind that the fees probably serve as a barrier to people abusing the system (more than what happens now).

            Regarding this patent (US8112504): They filed a patent app in 1996 that yielded other patents. The “family” of patent apps was kept alive until this new one issued. So no, the US system does not allow you to file something 16 years after the fact. That would definitely be stupid!

            As far as the Wikipedia link, there *might* be something in there, but it would have to read directly on the claims actually patented, which would take a lot of digging and analysis (that I don’t have time to do).

  5. I just got a patent for “being able to leave a comment in reply to an article/blog post in an online setting” and you are all in violation. Pay up! Mwa-ha-ha-ha!

  6. The point of a patent is to maximise the sociological benefits of invention by allowing relatively long-term rewards for the inventor.  The current system, which is essentially the fruit of western 19th century liberal thinking, works well enough in a 1950s era level of technological change.

    Side note:  demonstrate the system worked by comparing your household full of communist soviet inspired inventions vs your household full of western inventions.

    It’s ill-suited to today’s world – the timescales are too long, and the protections too broad, and the mechanisms for challenge or strike-down are unwieldy and expensive.

    Time to re-write this stuff for the 21st century.  The whole system is infringing on our ability to make a better world for the next generation.

    And if that’s not the point of our existence, what is?

    1. And if that’s not the point of our existence, what is?

      Serfdom for the 99%, bottomless wealth for the 1%.

    2. I totally agree – especially about the length of protection which needs to be reduced significantly. IP should be more about getting a foothold with your hardwork, not securing a monopoly with it.

      1. Especially in today’s world where the window of simultaneity of invention has reduced from months in the late 1800s to probably days or hours today.

        The only limit to invention with all the gear gizmos and information assistance we have now is … not much.  20 years hence, even less.  Maybe we’re even at the point where invention morphing into useable thing / method is so easy (additive manufacturing etc – eggs and sucking grannies, sorry) that people do it simply ‘because it’s cool’; and why not have machines inventing things?

        The inevitable outcome will be some kind of massive change – legal, or the large-scale destruction / spoofing of the capabilities to monitor IP and infringement.  Which isn’t so hard in a networked environment.

    3. Side note:  demonstrate the system worked by comparing your household full of communist soviet inspired inventions vs your household full of western inventions.

      Well, we’re still using Soviet space craft and Sovtek guitar amps are some of the best around.  Leon Theremin was a pretty prolific inventor/electronicist; the theremin is a goofy toy but that’s hardly all he did.  (It was decades before anyone in the US figured out how Theremin’s “thing” worked.)  Soviet education seems to have been really, really good — certainly better than most US public education — and this is reflected in the high-quality scientific research and mathematics done in the USSR throughout the 20th century.  (Of course, Soviet scientists often had to disguise their findings to make them consistent with Soviet ideology.  Nonetheless the research itself seems usually to have been pretty solid.)

      When assessing the positives and negatives of the Soviet Union let’s try to remember that we’ve been bombarded with explicit pro-capitalist, anti-socialist propaganda our entire lives as well as a sort of implicit propaganda that’s simply part of our culture after all these decades of explicit propaganda.  Our culture can make it difficult to objectively (or as near as possible) assess the positives and negatives of the Soviet system.  And there were positives even if it seems to me they were outweighed heavily by the negatives.

      One could argue similarly about the US “capitalist” system as well but I will not do so at this moment.

  7. We really need to try and stop the new first to file rules, as they will soon make prior art defenses worthless.  

    1. First to file sounds ridiculous.  Few inventions are so revolutionary that no-one else thought of it, most are the outcome of creative cross-pollination and simultaneous education and research that mean, in the appropriate brains, the light bulb goes on suddenly in lots of different people.

      Isn’t there a waiting period to see if anyone else files?  You’d think if other people filed very similar things, sharing the spoils would be fair.  You’d have to prove authenticity, no cheating etc, but that would work.

  8. I’m not convinced this law would actually have the effect hoped for.  As it is, most of these patent trolls are operating out of shell companies.  So instead of paying for legal costs if they loose a case, they will just declare bankruptcy and close up shop. I believe that would leave the people who fought the troll holding the bag and of course that doesn’t of course mean that the same people working out of the same office aren’t also working for 200 other patent holding companies.

  9. I’m pretty sure there’s prior art for recording audio and putting it on the internet.   In fact, I’d be shocked if I personally hadn’t  recorded audio and put it on the internet before they filed their patent.  I certainly did that before I ever heard the word “podcasting.”  

  10. I worry this wouldn’t work. If I were a patent troll I would set up individual Limited Liability Companies for each patent I held, and pay a nice healthy dividend to the parent company at the end of each month so the only asset the company had was the patent. Then if that subsidiary loses a case and has to pay a quarter of a million legal fees, I’ll just wind it up. The person who just invalidated the patent is welcome to it (for all the good it will do them) as all the licensing fees will stop coming in anyway.

    The lawyers would not get paid, so lawyers would not accept a case defending patent infringement, knowing they could be screwed out of their fees.

    The only way I can see this working is if the litigator has to put up a bond before starting action, but then that would deter a small genuine inventor from pursuing a company which is genuinely ripping off their valid patents.

    1. The proposed law includes a bond provision of the very sort you propose. Small genuine inventor does not have to post it; only corporations that did not themselves invent or exploit the patent do.

  11. How do you get a patent for something that you didn’t invent, and which has been around for years before you applied? I’m reminded of the Danish inventor who was denied a patent for his idea for salvaging sunken boats because the method had already been used by Donald Duck in a comic (Carl Barks was full of great ideas). Is US patent law completely lacking in such common sense?

    If it is, I guess I should apply to Texas for a patent on writing. Or perhaps making fire.

    1. Upcoming patent law changes all but eliminate prior art.

      I think they tested this system in Russia, to help the oligarchs, before bringing it here. I wonder what happened to that patent on glass bottles…?

  12. This is a horrible, terrible bill.  I am firmly against it.If you want to directly fix the situation, address 35 U.S.C. § 285 : “court in exceptional cases may award reasonable attorney fees to the prevailing party.”   Tone down “exceptional” , and attorney fees can be awarded when appropriate.  Create a USPTO review and recertification process for (oft?) litigated patents.  Create a variety of means to directly address the issue of Patent Trolling , without damaging inventors.  As-is, this law is an attack on individual inventors and the incentive to innovate / fund research & development.As-is, the actual wording of this law requires non-inventors to establish a Bond that covers attorney fees if they want to litigate.  The costs of serious Patent litigation ( not a trolling one ) where it is proven that one party violated another’s patents , averages $3-5 million dollars.   Under this law, if an independent inventor wants to sell their invention ( I’m not sure what would happen if a company is acquired ), that invention is no longer covered by the clause and effectively tremendously devalued — requiring bonds that are potentially millions of dollars to be posted , if litigation were ever to happen.  The market effects of this are obvious – it creates an economy where independent inventors must hold on to their patents, and secondary patent holders can be infringed upon with almost guaranteed impunity (by requiring a bond to be raised in order to go to court). On top of all this, some of the most notorious Patent Trolls would be totally immune from this law — many of them set up co-owned trusts/business entities or licensing schemes where there is joint ownership of the IP Rights with the inventor, enabling them protections under the “original inventor” clause.This law does little but ensure that patent litigation will happen between a David and Goliath, and preclude small/medium businesses from exerting patent protections.It is horribly misguided.

    1. Since you seem to be a person who honestly believes in Intellectual Property, I wonder if you can point me to some empirical evidence that demonstrates that it “promotes the progress of Science and useful arts” in any but the most exceptional cases? 

      All I ever hear is hand-waving pop-economics justifications. Lots of people talking about “market forces” and “incentives” as if by using these terms it’s clear that the numbers support their argument rather than destroy it… Economic relationships like that of innovation and regulation are complex and often produce very counterintuitive outcomes. 

      I wonder if there’s actually any evidence that we wouldn’t see an increase in economic growth and innovation rather than a decrease, as a result of eliminating intangible property rights.

  13. Consider two things- 1. the trolls loses his case but cannot pay- you are again responsible for his fees.
    2. at the risk of putting the cat among the pigeons, no one has mentioned injunctions.   Get a sympathetic judge to grant your injunction, and if your foe (for we have an adversarial judicial system) violates it they have committed a crime not merely something to argue over in a civil case.   Admittedly I’m not a lawyer, this is simplistic and the length of your sentence may go up as well as down, terms and conditions apply.  

  14. I appreciate the motivation behind the bill, but, as others have said, I think that it just makes it easier for big companies to screw legitimate inventors.  They can illegally use a patent, hire a huge legal team and, if they win, the inventor faces a huge penalty… that’s incentive not to hold them accountable.

    I’d rather have something like the following (this is off the top of my head, so probably just as unworkable for other reasons): Lose more than 5 cases, and your patent is automatically reviewed by a non-aligned organization to determine if it should have been granted in the first place or if prior art exists, or it’s being used outside of its area.  The patent may then be modified, bought out via eminent domain, or cancelled entirely.

    Threaten more than 25 cases in a given year, win or lose, your patent is automatically reviewed by the same agency because, again, of the possibility that it’s too broad, not enough of an innovation or an obvious outgrowth of existing technologies.

    1. You can’t limit someone’s (and a corporation is a person) access to the courts.  It’s a constitutional issue.  It’s the sort of thing for which international conventions are signed.

      1. Who’s limiting their access to the courts?  They have all the access they want.

        But if they keep having to file suits, either their patent was wrongly approved, or it’s so essential that people are constantly exploiting it.  So, if enough suits are filed, it triggers an outside review (by a division of the patent office, not the courts) on the patent to see if it is indeed appropriate.  If it is, great, they get a finding they can use in future suits to bolster their case.  If it’s not, then we solve the problem. 

        If the possibility of losing something valuable if they access the courts counts as “limiting their access to the courts”, then not only does the current system do just that (because if they fight the demand to pay for the patent violation, they pay far more than they would if they just pay up, rightly or wrongly), but so does the SHIELD act (because if they go to court against somebody who’s violating their patent, and they lose, they have to pay a potentially significant amount of money to cover lawyer’s fees of the huge corporation who is stealing your idea).

        And if ANYthing we do will limit people’s access to the courts, then I’d rather go with the one that potentially puts improperly patented things in the public domain rather than ties up courts with case after case.

  15. If you can empirically demonstrate (which it seems like you can) that intellectual property actually results in a net decrease in economic productivity and innovation, doesn’t that invalidate most of the laws and treaties that support it? 

    For instance, the constitution says that copyright must “promote Science and the useful arts”. If you can demonstrate that copyright law prevents more creations than it manifests, then it is unconstitutional. As written, the onus seems to be on the pro side to demonstrate that promotion happens.

    It seems like we should be arguing about the numbers here. Too bad it’s illegal to set up a control for that experiment.

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