The Legal Analysis Of Patent Trolls And Proposals To Tackle The Problem

It is undeniable that for enterprises the exact value of intellectual property rights is hard to estimate. On the one hand, intellectual property rights may bring about tremendous development opportunities for enterprises; on the other hand, intellectual property rights, however, may lead enterprises to disputes which may cause a huge amount of losses or, under some circumstances, a catastrophe. Currently, the patent can not only protect the right owner from the unauthorized use of technical proposal covered by the patent, but also has been developed into a tool for making profits in a broader sense. In recent years, both the number of patent applications and the number of patent litigations are increasing rapidly. Simultaneously, a group of entities named as Patent Trolls are running wildly in the market of intellectual property rights, asserting patent infringements and initiating patent suits constantly. As a result of that, enterprises in the market, especially those in the high-tech industry, are facing significant risks. Consequently, it has intensified the concern that whether the patent system can still encourage technical innovations and distribute new techniques. Though, to enterprises in China, the Patent Troll, as a concept originated from and developed in America, is a foreign one, they, in the globalized world today, cannot be immured from the influence to the market caused by Patent Trolls. Measures to tackle with Patent Trolls have been put forward so far. Yet Patent Trolls can still make use of all kinds of regulatory systems effectively to get enterprises into troubles. During the Sino-US trade frictions, enterprises in China have been suffering from the 337 Investigation at the United States International Trade Commission (USTIC). The 337 Investigation at the USTIC has a relatively shorter term, but a relatively complicated procedure and a high risk. The defendants at the 337 Investigation will be excluded from the market within the territory of US if they lose the case at the USITC. The US Supreme Court has reiterated the limitations on the remedy of injunctive relief under the Patent Act in the eBay case. After the eBay case, it is not as easy as before for Patent Trolls to be awarded injunctive reliefs at the court and consequently more and more Patent Trolls go to the USITC and seek for investigations against enterprises including those from China. It is true that in recent years Patent Trolls just have won part of cases they initiated and more and more countries in Europe and America have taken or are taking steps to restrict the activities of Patent Trolls. It, however, cannot be denied that cases filed by Patent Trolls against enterprises from China are increasing. What’s worse, it seems that Patent Trolls will enter and start their wars in China, and consequently Chinese enterprises will become the new targets.Attentions and vigilances from Chinese scholars, the business and high-tech community and even the government on Patent Trolls have been raised so far. But most of the current literature focused on the question that how China should response to the Patent Troll problem in US, and few of them discussed the problem in detail. Most of the current literature repeated the views of the first Chinese articles on this issue. Deep research on this issue was also rare. Another problem was that most of the current literature focused on US and few paid attention to countries other than US. Only a few of the current literature analyzed the root for Patent Troll in China from the micro and macro perspective. Nor did much of the literature discuss how to regulate or learn from the business model of Patent Troll to perfect the Chinese patent system. This article seeks to, based on the collection, analysis and comparison of Chinese and foreign cases and other literature and the fact that the current Chinese patent system does not run well, compare and use the experience of foreign countries and discuss the proposal that how China should tackle with Patent Troll and promote technical innovation during its patent reform from the perspective of law.The first chapter of this article will analyze the definition of Patent Troll and will seek to distinguish this concept from other concepts related to. Then it will go to the discussion of the reasons for the emergence and development Patent Troll, trying to discuss whether the emergence and development has realistic, historical and institutional foundation and whether the Patent Troll is an inevitable production of the patent system. The second chapter of this article will start from the typical examples of Patent Troll, and seek to make a concrete introduction of Patent Troll from the micro perspective. After that this article will, from a macro perspective, based on the empirical researches conducted by foreign scholars and the deviation of outcomes from researches on European states and USA to analysis the features of Patent Troll. Through the combination of micro and macro analysis, this article seeks to establish the image of Patent Troll, i.e. though Patent Troll may bring about benefits to the development of the patent system in general, it may also causes high transaction costs and may cause significant damages to the patent system. In the third chapter, this article will discuss measures taken by a variety of jurisdictions to tackle with Patent Trolls from the perspective of case study and comparative law. This article will also discuss the patent reform in USA in this chapter. Afterwards, this article will analyze and conclude how other jurisdictions tackle with Patent Trolls while keeping the innovation incentives of the patent system. In the fourth chapter, this article will first introduce the current status of the patent system of China. Combining with the discussion of the connection between patent system and Patent Troll in previous chapters, this article will analyze the root for Patent Troll to emerge and develop in China. In the last part of this chapter, this article will, by discussing the root for Patent Trolls in China, business models of Patent Trolls and its comparison with the fact of patent management in China, express the necessity for the reform of current Chinese patent system to face the challenges incurred by Patent Trolls. In the last chapter of this article, this article will put forward the proposal to tackle with Patent Trolls while keeping the innovation incentive of the patent system from the perspective of patent incentive, review and commercialization, and of patent remedy.