Joe Mullin's Ars Technica piece, "Patent trolls want $1,000—for using scanners," is an excellent, blood-boiling piece detailing the ease with which the US patent system can be used for pure extortion. A company — its identity is shrouded in mystery and hidden behind several layers of obfuscation — has a series of junk-patents allegedly covering any time anyone scans a document over a network and attaches the scan to an email. That may not, in fact, be what the patents say, but they're written in such absolutely tortured fashion that it's impossible to say.
The company — and its many alphnumerical subsidiaries — send invoices to small and medium business, threatening to sue them if they don't pay a per-employee license fee. Any company that fights risks having to pay triple damages for "willful infringement," though the companies that do fight win — the patents are garbage, there's tons of invalidating prior art. But they still have to pay thousands in legal fees for the privilege of fending off these creeps.
When patent-troll apologists tell you that the patent system is necessary to protect "invention," ask them why the acceptable cost for this protection is allowing any unscrupulous scumbag to use the court system to extract windfalls from productive companies on the basis of having claimed to invented commonplace, existing, obvious technologies.
Vicinanza was able to get in touch with several other Project Paperless targets, suggesting that Project Paperless lawyers were indeed targeting companies based on the list.
Reactions to the letters varied. "Without question, some people were livid," said Vicinanza. "Some of the smaller ones were scared out of their wits, in addition to being livid."
Some were ready to fight back, while others had no intention of doing so. One mid-sized Atlanta business in the process of being acquired by a major Silicon Valley tech company paid the Project Paperless demand, no questions asked. Some companies just ignored the letters; others talked to an attorney. It isn't clear the companies that did speak to their lawyers about the situation actually fared better.
"The patent attorneys typically have a whole different set of objectives," said Vicinanza. "Now they're in settlement mode. If the company does end up getting sued and the lawyer said 'ignore them,' a company could find themselves paying treble damages. Even my attorneys told me, settle it, you're crazy to fight."