Most Read Contributor in United States, April 2016
Originally published in Technology Transfer
Gerard P. Norton was quoted in the Technology Transfer
Tactics article "Working with 'Patent Trolls'
Could Bring Income, but at What Cost?" While the full text can
be found in the January 2014, issue of Technology Transfer
Tactics, a synopsis is noted below.
While there is no hard consensus about whether monetizing
patents through patent assertion entities (PAEs) is a good move for
universities, those involved say the decision should be made
carefully and with an eye toward unintended consequences that could
negate any financial gain.
PAEs, also known as "patent trolls," are under
fire from legislators and the business community. Some university
TTOs do work with PAEs but are not eager to talk about it, while
others have decided that PAEs pose too much risk and do not fit
with their missions.
Norton notes that there are over 2,000 cases pending in
U.S. District Courts in which a PAE has asserted infringement of a
Norton understands that universities are faced with
strapped budgets, and a PAE offering a deal for a group of patents
could be hard to turn down. The trend is for universities to work
with PAEs more than in the past, Norton confirms, but not without
some negative consequences.
"It's a double-edged sword. Working with PAEs can
have a chilling effect on future development and on a
university's efforts to establish relationships in the business
community," he says. "Are large pharmaceutical companies
going to want to work with a school known for using
Universities that take part in that litigation can benefit
financially, but it may bring on a PR nightmare, Norton says.
"If the CEO is a graduate of the university, that's going
to be an embarrassment," he says. "The university can
protect itself by exercising some control over which entities [can]
be sued. At least have a right of first refusal."
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On May 5, 2016, the White House issued a report largely piggybacking on a recent U.S. Treasury Department study, on which we previously posted, with a primary focus on the purported misuse and negative impacts of non-compete agreements.
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