At the beginning of this year, owners of small companies in Atlanta and Virginia began to receive letters of strange content. The five-page document contains a description of patents for digital workflow in the local network and a proposal to issue a perpetual license to use patents at the rate of $ 1,000 for each employee.
The letter makes it clear that if you have a scanner that is connected to the network and sends a PDF via e-mail, you are violating US patents
6,185,590 ,
6,771,381 ,
7,477,410 and
7,986,426 , the first of which is dated 1997. Naturally, the value of these patents on commonly used technologies and methods of workflow is close to zero. But this does not play a special role, because in the case of a lawsuit, the costs will be much higher. Most lawyers will tell you that in such a situation it is better not to take risks and enter into negotiations with the patent owner to reduce the amount of deductions, and then pay. So many companies do.
Some experts compare such a business with organized crime, racketeering and extortion. But behind this “extortion” are lawyers, so everything is done exclusively within the law.
This is another example that patent trolls have recently begun to work not only with large corporations, but also with end users,
writes Ars Technica . Previously, there were already similar patent
claims against WiFi hotspot owners and corporate
SSL users . If you cover a sufficient percentage of end users, then the patent owner can get even more profit than a lawsuit against corporations. Moreover, large corporations have full-time lawyers, and here the patent owner may be left with nothing. It is much easier to attack a small business.
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Competently executed letters explain the principle of the patent and describe the responsibility that the user bears for the violation. If he refuses to pay for the license, then he faces a lawsuit, a fine and a threefold increase in license fees for "intentional attempt to evade payment."
There was only one company that decided, instead of 200 thousand license fees, to make millions in losses - but to put the patent troll in place. This is BlueWave Computing, which, following the results of the trial, published a
winning press release in August 2012.
Unfortunately, that defeat in court did not stop Project Paperless LLC and their partners from the law firm
Hill, Kertscher and Wharton . Although, the online appearance of the incriminating site,
Stop Project Paperless, forced them to change tactics.
They handed over patents in the name of a certain holding company for which they had established a number of subsidiary companies, and now they have resumed sending letters of similar content. One of these letters is listed below.
Letters are sent from companies AccNum, AllLed, AdzPro, CalNeb, ChaPac, FanPar, FasLan, FulNer, GosNel and HunLos. Perhaps there are other companies. All of them send letters of the same content, where only the amount of deductions varies from $ 900 to $ 1200 for each employee.
The recipient of such requirements has several options. They can ignore the letter, agree to the demands or challenge them in court.
In September 2012, the Law School of the University of Santa Clara published the
study “Startups and Patent Trolls” (pdf), which contains an interesting conclusion: the cheapest thing for companies is to ignore such letters. In fact, the right holder rarely sues, and prefers to continue to collect money in an easy way. The study showed that patent trolls' requirements ignore 22% of startups, in this case companies average expenditures amount to $ 3 thousand. About 35% of companies try to actively oppose trolls, court costs average $ 857 thousand. If you immediately go to negotiations and conclude a deal, then the average expenses of the company are $ 340 thousand.