US Inventor Arguments for Opposing the Pride in Patent Ownership Act Fall Short on the Merits

“Non-practicing entities like ParkerVision that make meritless litigation their business demonstrate why we need greater transparency in our patent system, not why transparency efforts should be opposed.”

Pride in Patent Ownership ActLast September, a bipartisan pair of Senators introduced the Pride in Patent Ownership Act, which, if passed, would add greatly-needed transparency to our patent system. The legislation would require patent owners to disclose their identity to the U.S. Patent and Trademark Office (USPTO) when a patent issues and whenever it changes hands so that members of the public have easy access to information about who the true owners of patents are.

Right now, inventors, businesses, and other interested members of the public often have to undertake time consuming and expensive litigation to determine who owns a patent. As Senator Thom Tillis (R-NC) rightly pointed out when introducing the legislation, “Patents provide a limited term monopoly against the public, and it’s in the public’s interest and benefit to know who owns that monopoly.” Senator Patrick Leahy (D-VT) echoed this sentiment, stating, “In exchange for the exclusive rights over an invention granted by a patent, the public has a right to know who owns the rights to particular inventions.”

That shouldn’t be controversial: the USPTO is required by statute to “maintain a register of interests in patents.” The fact the law does not explicitly require patent owners to register their interests is just a loophole that urgently needs to close.

Transparency in patent ownership is particularly important when considering that, in every year since 2008, more than half of U.S. patents have been granted to applicants from outside the United States, and there is currently no record of when a U.S.-based applicant transfers its patents to a foreign entity.

Intellectual property related to cutting-edge innovations is essential to maintain U.S. national security and economic leadership, and a more transparent patent system is necessary for our key industries to remain competitive globally. Which is why it is concerning to see Pride in Patent Ownership detractors, like former US Inventor President Paul Morinville, use misleading claims to oppose the legislation’s passage.

Morinville relies on a number of inaccurate arguments in his piece, but as someone who has long followed this issue, I was particularly surprised to see cases involving the company ParkerVision being used as “a perfect example” of why the Pride in Patent Ownership Act must not be passed. The fact that Morinville highlights ParkerVision, when it is in fact an example of the type of bad behavior that we should seek to reduce, underscores the weakness of arguments against greater transparency.

What is ParkerVision?

Let’s start with the basics: What is ParkerVision? ParkerVision is a company whose only revenue stream comes from filing patent infringement lawsuits with the hope of extracting payments from businesses that actually develop and produce goods.

ParkerVision’s website claims that it “is a leader in proprietary radio frequency (RF) technologies,” but the closer you look, the more you notice its far-reaching claims refer to its patent portfolio rather than any technology or products it built.

The investment management firm Kerrisdale Capital issued a report on ParkerVision, which detailed its business model in no uncertain terms. The report states that “The Company has no customers, no stores, and no future expected income” and later notes, “since the Company hasn’t been able to compete…as demonstrated over the past decade of partnership failures, it appears to have decided to become a patent troll.”

By ParkerVision’s own admission in its 2019 annual report to the Securities and Exchange Commission, the “primary focus of our business plan is now the enforcement of our intellectual property rights through patent infringement litigation and licensing efforts.”

Was ParkerVision the Victim of Willful Infringement?

Morinville portrays ParkerVision as a victim of so-called “willful infringement” by companies like Qualcomm and Intel. More plainly, he is claiming that ParkerVision invented groundbreaking technology that large tech companies deliberately copied knowing they wouldn’t face consequences.

That claim is wildly inaccurate. ParkerVision has a long track record of making similarly inflated—and later debunked—claims.

As the Kerrisdale Capital report points out, ParkerVision’s “technological claims have been debunked in detailed manner by multiple leading experts.” The report cautions investors against being optimistic about seeing a return from ParkerVision’s patent infringement cases because “ParkerVision’s purported innovations are neither novel nor feasible, and are unlikely to survive . . . close scrutiny by the court system.” Indeed, German courts have repeatedly rejected ParkerVision’s infringement claims against tech companies like Apple and LG, and U.S. courts have similarly rejected ParkerVision claims against Qualcomm. A Forbes article that assessed the value of ParkerVision stock noted that, after its product underwent a “black box” test at Boeing, “it didn’t do anything better, or faster, or more efficiently than we could do in a number of ways.” Despite this, ParkerVision issued a press release touting its successful test.

Morinville also asserts that Qualcomm and Intel “made conscious decisions to willfully infringe ParkerVision’s patents” and alludes to emails between company employees discussing the value of ParkerVision’s technology. But court documents clearly show what employees of Intel and Infineon, which Intel later acquired, were discussing: ParkerVision’s poor reputation and their skepticism about its technology. Notably, email communications show employees explicitly stating that “Parker vision doesn’t have a very good track record as it has to do with new IP… Bottom line: in my opinion there is no reason to do anything with them before they can present real data from . . . a real case scenario of a real system.”

Morinville uses incomplete information and misleading arguments to portray ParkerVision as a victim, when in fact, it is a failed company with a “checkered financial past, and questionable technological claims” that turned to litigation in an attempt to profit off others’ success.

The Benefits of Greater Transparency

Non-practicing entities (NPEs) like ParkerVision that make meritless litigation their business demonstrate why we need greater transparency in our patent system, not why transparency efforts should be opposed. Transparency will shine light on the networks of investors—including foreign government-backed funds—hiding behind patent troll shell companies. That will allow judges, juries, and businesses facing patent infringement accusations to accurately assess patent owners’ claims and impose effective sanctions on those who bring exceptionally meritless cases. It will also help the public and policymakers understand how taxpayer-funded courts are being used and whom U.S. patents are benefiting.

Morinville asserts that the Pride in Patent Ownership Act will allow big tech companies to target smaller inventors with increased post-grant scrutiny, but that makes no sense. Transparency will not change the availability of post-grant review. Nor does such scrutiny pose any risk to owners of patents on real inventions.

The fact that Morinville elevates ParkerVision as his most sympathetic “victim” only shows how strong the case for greater transparency is.

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Copyright:iqoncept 

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13 comments so far. Add my comment.

  • [Avatar for Hugh J. Coque]
    Hugh J. Coque
    December 6, 2022 03:30 pm

    More losing for ParkerVision

    https://www.law360.com/articles/1550879/ptab-axes-claims-in-parkervision-ip-involved-in-wdtx-suits

  • [Avatar for George]
    George
    December 5, 2022 02:41 pm

    All excellent comments that I agree with completely. Bottom line – we need to repeal the AIA!

    It is a now ‘proven catastrophe’ that has NOTHING to do with the original intent of the Founders (which was succinctly stated in a single paragraph). Patents were never supposed to be issued by the 100,000’s (mostly overlapping one another) and were never intended to be prohibitively expense to obtain or protect. They were supposed to be rights available to ALL deserving Americans and ‘blind’ to their financial or social standing. Patents were supposed to be an ‘egalitarian right’ (given the limited definition of ‘egalitarian’ at the time).

    At least when slavery finally ended, even poor ex-slaves were able to obtain patents and become affluent or even rich, in some cases with just a SINGLE broad patent and in most cases no need for litigation at all! So, WHAT HAPPENED . . . to our once great system for providing IP rights and justice? Who’s responsible for the absurdly ‘wasteful’ and ‘job-destroying’ MESS we have today?! Who are the people responsible for this? It’s NOT inventors. It’s not even ‘patent trolls’, since they didn’t even exist 20 years ago! Patent trolls were a problem CREATED by Congress and the USPTO! The blame must rest solely with them and so they need to be held accountable for this ‘disaster’.

  • [Avatar for Pro Se]
    Pro Se
    December 2, 2022 10:43 am

    Anyone who hasn’t represented a corporate client as a lawyer not running the USPTO as Director or within a 3-panel APJ board, raise their hand….

    Anyone?

    You think anyone addicted to food working at McDonalds won’t dip their hands in the fries?

    Global IP monitoring agencies laugh as how bad the U.S. Patent System is corrupt and owned by corporations.

  • [Avatar for Curious]
    Curious
    November 30, 2022 10:04 am

    Also, the author clerked for Judge Dyk. Enough said. The most anti-patent CAFC judge out there.
    Something you and I can agree on.

  • [Avatar for Concerned]
    Concerned
    November 30, 2022 09:29 am

    I think all the other comments here really do a good job of exposing the article for what it is. It’s so easy to spot – anytime some one says something has been “debunked by experts” or something like that, it obviously signals that the source was actually saying something true and is now essentially being slandered by a “fact checker” who simply disagrees and wishes the issue was presented in a light they feel is more favorable. In other words, “debunking” isn’t debunking anymore. It’s merely disagreeing with someone and the term is actually meant to overwhelm the reader into not questioning the veracity of the “debunker” themselves.

    Also, the author clerked for Judge Dyk. Enough said. The most anti-patent CAFC judge out there.

  • [Avatar for Inventor]
    Inventor
    November 30, 2022 09:01 am

    Alex,

    1) Please tell me where does it say that in order to own a patent you must also have a *successful* company that uses that technology? Hint: There is nothing that says that. People who come up with innovative ideas are typically a different type of person than those that know how to run successful businesses. There is nothing wrong with just coming up with ideas and not run a successful company, just like there is nothing wrong with running successful companies without owning any patents.

    2) Your point that the public needs to know ownership *before* any litigation is moot because;
    A) Knowing that a foreign entity just bought a patent won’t prevent that sale of the patent to a foreign entity,
    B) Isn’t the “true” owner/interests of a patent required to be disclosed when you file a PTAB?

    So, as you can see knowing this info *before* litigation is totally useless, but yet there is *already* rules in place that the true owner of a patent needs to be disclosed for any litigation. So aside from these reasons, how is not knowing the owner of a patent outside of litigation a bad thing that this bill is trying to “fix”?

    All this bill will do is give infringers a heads up that there may soon be litigation against them and give them the opportunity to dig deep into their pockets and file serial PTAB claims to hopefully kill any chances of a lawsuit from even being filed.

  • [Avatar for David Hoyle]
    David Hoyle
    November 30, 2022 08:16 am

    There has been a recent uptick in the last 30 days, using the worn out usage of “Patent Troll.” This is according to Google trends. The area of the Country where this has occurred is, unsurprisingly, D.C.. Is this Predatory Infringers way of passing Leahy’s bill? …Certainly seems so.

    In researching the last uptick, many of the so-called reporters, were nothing but paid shills, funded by Big Tech.

    The writer of this article has recently appeared on multiple articles proclaiming the sky is falling because of patent trolls. One has to wonder––– Who is funding his organization? I searched his website and as expected, nothing appears on who is paying his salary.

    Quacks like a duck, looks like a duck, and barks “Patent Troll” like a duck….

  • [Avatar for Pro Say]
    Pro Say
    November 29, 2022 11:09 pm

    How many patents do you have Alex? How many have you applied for?

    How may innovations have you come up with?

    Ivory-towerism is strong in this one.

    Very strong indeed.

  • [Avatar for Pro Say]
    Pro Say
    November 29, 2022 11:09 pm

    How many patents do you have Alex? How many have you applied for?

    How may innovations have you come up with?

    Ivory-towerism is strong in this one.

    Very strong indeed.

  • [Avatar for Anon]
    Anon
    November 29, 2022 05:34 pm

    Consider the source (from her bio):

    Alex previously worked as a staff attorney and the Mark Cuban Chair bto Eliminate Stupid Patents at the Electronic Frontier Foundation, where she continues to serve as a Special Advisor.

    The EFF is also a known front for the Efficient InFringer Front.

    These are not the friends of patents (and innovation) that they would make themselves out to be.

  • [Avatar for David Hoyle]
    David Hoyle
    November 29, 2022 01:31 pm

    This article is yet another example of ignorance, or willful blindness, of how the patent system should work. Who cares who owns the patents? If a company buys the patents from an inventor, it accomplishes two things. 1) The Inventor can go back to what he does best– Innovate. 2) and the company who purchased it can monetize it, how he seems best.

    Look at the recording industry. Musicians sell their songs individually or as a catalog all the time. Why? So they can go back and create more. This concept that a patent holder can only hold a patent if he manufactures or sells the product is so ridiculous that it’s laughable.

    History praises Edison but in today’s world, he would be castigated. Thank God! he didn’t have to deal with the likes of Leahy who never met an inventor he liked!

    Why can’t we have a system where an inventor has the same rights as Lady Gaga? Not a fan of hers, but she is allowed to profit from her creation, and no one tells her who she can sell her song to. Why should inventors be any different??

  • [Avatar for Lab Jedor]
    Lab Jedor
    November 29, 2022 01:24 pm

    1) the “Pride” Act is an example of continuing shenanigans against patent owners. What is important for innovation is the publication of the patent. This allows any potential infringer to do their “required” homework and check if they infringe. It is really as simple as that.

    Knowing who owns a patent is mostly useful to infringers to assess if infringement is worthwhile based on the perceived strength of the patent owner. As such the whole act is unwelcome and anti-patent owner.

    The whole idea seems to be provided by lobbyists for potential infringers whose intent it is to weaken patent ownership for independent inventors.

    2) The company ParkerVision is, as I understand it, an R&D firm. It develops new technology in for instance Radio Frequency (RF) technology. A quick check on the named inventors on the patent show consistency of a core group of company based inventors. No lack of transparency there.

    The history of their patents goes back to the year 2000. Any company working in RF technology, including Qualcomm and others should be aware of the ParkerVision portfolio.

    3) The portfolio of ParkerVision is developed and owned by (you may guess it) ParkerVision. So what? Are they not allowed to assert their IP because they do not manufacture anything? Whatever ParkVision is, they publish what they own (check their website) and they are not in any way hiding that they own and assert a very broad and well deserved, carefully developed and managed patent portfolio. Are you against patent owners asserting their IP?

    4) If you had checked the USPTO database, you would have noticed that Qualcomm cites ParkerVision patents as prior art in their own patents. So, they are well aware of the ParkerVision developed technology. There is nothing in the “Pride” Act that would remedy any “your Honor we did not know about the existing prior art” nonsense that you try to sell us.

    5) As to the “technical value” of the patents. All is in the patents. There is nothing in the “Pride” Act that would improve the transparency of the novel technology.

    We commonly see the “talking point trick” of doubting the technological value of a patent. Your brief resume does not indicate any specific knowledge or skills in Electronic Engineering or RF technology. Actually, it seems you have no meaningful training in technology at all.

    Morinville on the other hand has provided a technical analysis why the ParkerVision patents have technical merits. He specifically says in one of his IPWatchdog posts: “To understand the word salad, you’ll need some basic knowledge of radio signals and receivers.” Which you appear not to have to warrant any foundation on your opinion of the technical merits of the patents.

    The arguments in your post are mainly ideological and provide no meaningful arguments to accept the “Pride” Act or how it improves our patent system, which continues its slide, with your help, into a bureaucratic purgatory that is maintained for self-perpetuating purposes only.

  • [Avatar for xtian]
    xtian
    November 29, 2022 09:11 am

    “Right now, inventors, businesses, and other interested members of the public often have to undertake time consuming and expensive litigation to determine who owns a patent.”

    First, this sentence doesn’t even make sense. How do business succumb to (or suffer from) litigation to find the ownership of a patent? Please provide an example?

    Second, your characterization of ParkerVision is not relevant. You open this article saying that there is a need for transparency to understand who exactly owns a patent. That’s why you support this proposed bill. However, your refutation of ParkerVision is based on their business model of buying and asserting patents, and your opinion of whether those patents are valid or not. How does your opinion on the patented technology affect whether you need to know the owner of the patent? Are you saying that ParkerVision’s patents are junk just because they are owned by ParkerVision? However, if those same patents were owned by a different entity, say a University, those patents are now valid?

    Your conclusion answers those questions: “That will allow judges, juries, and businesses facing patent infringement accusations to accurately assess patent owners’ claims and impose effective sanctions on those who bring exceptionally meritless cases.”

    Only those companies you approve of are allowed to own and assert patents. That is now transparent!!!

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