You might think that a company claiming ownership over the broad notion of podcasts is comparable to a declaration of one’s exclusive right to cry during the bar exam, being the first person to mix lemonade and iced tea or being the inventor of googling yourself. However, Adam Carolla, NBC, CBS and the Discovery Channel might disagree, after recently being sued by a company called Personal Audio LLC. Personal Audio asserted that its patent (Pat. No. 8,112,514), which was based on an application originally filed in 1996 and claims the making of “episodic content that can be downloaded from a specific URL that client software can retrieve and store,” subsumes the underlying technology for all major podcasts. Despite often hyperbolic claims and a label evocative of “Game of Thrones,” “patent trolls” are capable of bringing disruption and financial devastation to your clients and their businesses.
Patent trolls, or, as they are less gruesomely known, nonpracticing entities, NPEs or patent-assertion (or -monetization) entities, are generally defined as any entity that asserts a patent or family of patents against other parties, but does not, itself, practice the patent by, for example, selling a product or service based on it. Many businesses, when faced with an infringement lawsuit or a proposed licensing or demand letter, will pay the NPE the requested amount, instead of risking the somewhat unpredictable costs associated with litigation. This contributes to the increased vulnerability of higher-profile businesses, especially those operating primarily online or with a strong online presence. Their activities are easy to track and any success or growth may indicate to an NPE the likelihood of a lucrative settlement
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