Assignment 8 Part 1- Basic definition of patent troll

A patent troll is an NPE (Non Practicing Entity) that does not effectively use their patent constructively to create or promote a product or service, but rather sues others who infringe the patent to make money.

While many companies with patents do not personally produce anything they choose to license the patented technology to others to take a piece of the product. These types of companies are not considered patent trolls. Rather patent trolls do not look for licensing deals but rather wait for an infractions so that they can litigate.

Sometimes a company will attempt to make their product using the patent and either outright fail or simply not be as good/competitive as a competitor, and will thus sue the other company to makes some kind of profit.

This is a much larger issue in America than in Europe for example partially because Europe has a loser pays for legal expenses rule while in America both parties pay for their individual legal costs regardless of anything else.

Most examples of patent trolls today have to do with software patents and thus for many companies it is very profitable to stockpile patents and many times not make a licensing deal because first they can make money from the litigation as well as potentially hurt a competitor through not giving them a licensing deal even if it would be mutually beneficial.