By Christine Kern, contributing writer
Patent litigation is on the rise in 2015, and retailers are pressuring for changes in the patent litigation law that would help protect them against “patent trolls.” These trolls, who make money by purchasing overly-broad and nearly expired patents with the intent of suing retailers that allegedly infringe on those patents, are stirring up expensive trouble for retailers. And in many cases, even their most preposterous allegations are costing retailers money.
And Unified Patents estimates thank in 2015, patent disputes will exceed 7,000.
A few examples of retail technologies that have been targeted by patent trolls include patented Wi-Fi routers; payment technologies that enable debit and gift cards to process information from the magnetic strip on the back of the card; smartphone app technologies; online shopping cart technologies; and ‘scan-to-email” schemes.
The NRF, which helped found United for Patent Reform coalition, supports the House-introduced Innovation Act and Senate-introduced PATENT Act.
Beth Provenzano, vice president of the National Retail Federation, addressed the dangers of patent trolls in a statement that directly addressed the problem of eDekka, a Plano, Texas-based patent troll that has filed over 100 patent lawsuits last year alone, mostly against retailers. She said, “I think it just speaks to the need for multifaceted patent reform legislation,” underscoring that bad actors like eDekka have taken a serious toll on retailers. “We’ve seen the retail industry become a bigger and bigger target over the years as we adopt and implement more technology.”
“There was a study that came out in 2012 saying retailers are targeted more than tech companies,” Provenzano said. “And I think it’s because so many more of us are using technology that someone else created. These entities know retailers don’t develop the technology themselves, and so they’re not the best to defend themselves against the alleged infringement,” she explained.
According to the National Retail Federation, a number of retailers are abandoning plans for new technological innovations in-store as a result of the rise in patent trolls. For example, Whataburger scrapped plans to offer Wi-Fi in their restaurants out of concern over patent litigation.
As the NRF article states, “Patent trolls will keep capitalizing on the asymmetry in the current system to target end users – retailers of all sizes – of technology. Legislation like the Innovation Act and the PATENT Act must be built on these important pillars to reign in this bad behavior. Only then will retailers be able to stop spending time and money on costly legislation and be able to focus their energy on providing jobs and adopting innovations.”
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