More Dreck on Patent Trolls from Attorneys Cozying Up to Silicon Valley

On July 3rd, the Buffalo Law Journal published an column with the incredibly dubious headline Fighting Back Against Patent Trolls. The piece, co-authored by David Principe and David Rudroff, both lawyers at the Buffalo, NY-based law firm Phillips Lytle, looks through recent Supreme Court case law as well as Congressional legislation and offers tips to patent infringement defendants on how those recent developments have “made it easier than ever to fight back against this unfair practice.” That unfair practice, of course, being the enforcement of an intellectual property right against someone who is infringing on that property.

Principe and Rudroff unfortunately regurgitate much of the misguided dialogue, which has done nothing to serve this country except to decimate its patent system in recent years. In the view of the authors, patent trolls, or patent assertion entities (PAEs) (which the authors note is the less pejorative term), provide no market value and often enforce software or business method patents which have questionable validity. Of course, it is worth noting that in its 2016 study on PAEs, the Obama Federal Trade Commission called the term “patent troll” both unhelpful and prejudicial, and also specifically recognized that PAEs can and do play a valuable role in the market. So the conclusions of Principe and Rudroff are not supported by even an FTC study commissioned for the purpose of condemning patent trolls. 

It’s rather curious for either of these attorneys to be putting their name on a piece designed to stoke fears regarding the owners of property rights.

Rudroff, a commercial lawyer at Phillips Lytle whose practice involves patent and trademark infringement cases, would seem to have a bit more reason to cater to the efficient infringement crowd. According to information collected through Lex Machina, Rudroff is one of the attorneys on record representing patent infringement defendant MIFAB Incorporated in a patent suit brought by W.D. Manor Mechanical Contractors Inc. currently ongoing in the Northern District of Illinois. According to Lex Machina, that is the only case involving either trademark or patent infringement claims in which Rudroff has appeared as counsel, so perhaps his lack of experience led him into the patent troll debate.

Principe’s role in the article is much more confusing, raising the question about whether he is selling out to the efficient infringement cabal that wants people to think that patent trolls actually exist (beyond MPHJ Technology Investments, of course).

Principe has a great deal more experience in legal matters surrounding patents; his bio page on the Phillips Lytle website notes that he has prosecuted at least 17 utility and design patents at the U.S. Patent and Trademark Office. Right there, it comes off as a little disingenuous that Principe would co-write an article that scoffs at the value of patents when he has been engaged in secure those same patent rights for his clients.

Further, although Lex Machina data shows that Principe hasn’t served as counsel of record in a patent infringement case in district court, he did represent patent owner Moneycat Ltd. in four covered business method (CBM) review proceedings petitioned by ecommerce giant eBay at the Patent Trial and Appeal Board (PTAB). One of those CBMs was denied institution. The three CBMs  instituted resulted in final written decisions of all claims invalid. The PTAB has often been heralded by efficient infringement supporters as a way to deal with patent trolls and Principe’s failures at that forum, coupled with his recent diatribe against patent trolls, could be indicative of an “if you can’t beat ‘em, join ‘em” mindset.

This mindset seems even more likely given one of the Supreme Court decisions touted by Principe in the Buffalo Law Journal article as an effective means for fighting against patent trolls in court. The column cites the 2006 decision in eBay v. MercExchange as a positive development, which has caused U.S. district courts to be much more hesitant in granting permanent injunctions upon a finding of patent infringement. To the contrary, the eBay decision is widely regarded as the turning point against patent rights and innovators, and one of the pivotal moments most responsible for the overall weakening of the U.S. patent system. See The Top 3 Reasons the U.S. Patent System is in Decline. 

It would be interesting to find out whether Moneycat knew that Principe was so supportive of eBay’s effects on the U.S. patent system prior to hiring Principe to represent the firm at the PTAB against eBay. As if that wasn’t bad enough, Principe also hails the creation of the PTAB as part of the enactment of the America Invents Act of 2011 as a “more hands-on approach” available to those who want to challenge a patent’s validity. To his credit, Principe only discusses inter partes review (IPR) proceedings at the PTAB and smartly stays away from any mention of CBM reviews, lest he come off as a complete shill only trying to make up for perceived sins of the past (i.e., his representation of a patent owner in CBM proceedings). 

Of course, the creation of the PTAB is widely recognizes as one of the other seminal moments in recent patent history most responsible for the dismantling of the U.S. patent system. Indeed, none other than USPTO Director Andrei Iancu has pledged not to follow the same path and has the Patent Office reviewing PTAB procedures from top to bottom with major revisions anticipated because the administrative tribunal has run amok. Indeed, the first revised proposals have already been released. Still further, the U.S. Chamber of Commerce annual report has continually cited the PTAB and its opposition proceedings for year after year decreasing the ranking of the U.S. patent system, which now ranks 12th in the world. See U.S. Patent System Falls to 12th.

Perhaps Principe and Rudroff should stick with matters they know more about. 

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