This.
Ultimately, the question of trollitude is a question of motive. Are you scamming, or are you building? For even fairly intangible values of “build”.
It seems a few people have misunderstood my question. I’ was wondering if there’s an existing definition for ‘patent troll’/NPE that doesn’t also apply to ARM Holdings, a company that clearly is not a patent troll or NPE.
Based on what I’ve seen so far, it seems likely to be one of those concepts (like “obscenity”) most precisely described by a series of tests.
Not really. The question of patent trollitude is whether or not you are using your patents as a lever by which to intimidate other “infringing” companies into settling out of court with you, or licensing your patent just to get you out of your hair, and that this intimidatory scheme is your primary method of revenue.
It’s basically trying to extort money out of people for “infringement” vs. whatever combination of patent defense and licensing that a normal company does.
An example would be that a patent troll would patent something vague, or tangentially related, and then either sue them and force them to settle rather than incur large court costs and/or an unfavorable judgement, or they threaten to sue and force the other company to license their technology to avoid court costs.
By comparison, a legitimate company only sues/threatens to sue if they feel that someone is legitimately infringing on their patent, and their primary mode of making money is to licence (without intimidation) their technology to other companies so that they can use it in their products.
Right. The main difference between ARM and AMD is that ARM designs the technology and then lets manufacturers license it and take it from there. AMD is also a fabless company (they don’t physically make any chips, at least anymore), but they actually contract out manufacturing to other companies and then take ownership of the resulting chips, which they then sell as official AMD chips. AMD thus has a different risk model because they market and sell their own chips as opposed to shifting the risk (of making chips that nobody wants to buy) to licensees. AMD isn’t really doing so well with that right now, but they also stand to profit handsomely if they can reconquer market share.
Right. In that case, ARM could do something like what IBM did and transition its business more toward consulting and away from strict design per se. ARM would have a lot of business goodwill that they could leverage to position themselves as the #1 experts in ARM engineering consulting.
Agreed, but that’s not a useful definition. Everyone asserting a patent will say that whatever they’re doing somehow benefits society, no matter how implausible that might be.
Since the concept has no specific legal meaning (unlike obscenity), it doesn’t need a strict definition. In the limit, an NPE/troll is just “a company with a patent-heavy business model that’s asserting one in a way I don’t like”.
We could define a patent troll as “a company (a) that derives most of its current or projected income from patent licenses, and (b) whose licensees mostly first became aware of the licensed inventions independently of the patent owner”, and that aligns pretty well with common use. The second part is still hard to prove or disprove, but at least that gets the moral judgment out. That of course would exclude ARM.
Arm absolutely has patents but for the most part you are probably correct that mostly copyright is involved. But I think that various AMD Intel court cases have stated that instructions sets are not subject to copyright.
ARM provides a lot more than just the instruction set. They have other designs like caches, memory interfaces etc. Then they have testing suites for the various processors which are super important and time consuming to create and validate.
They are also even more fabless than companies like Qualcomm. I don’t think that ARM sells any chips at all. The just sell IP to other companies who then design chip and get them fabed.
This makes sense. Instruction sets are, in essence, languages, and languages can’t be copyrighted.
As an inventor, I would want my IP to be liquid. In the case of ARM, designs become obsolete quickly, but for other types of inventions, a patented design might be viable long after the patent expires. If I decide to exit my business, should I be limited to only selling my IP to competitors or those who want to get into the business?
They also implement their designs in test chips for new process nodes, so that people who buy their IP can be certain that it works. I don’t work for ARM, but I know several people who do.
ARM is one instance of a branch of IC design called IP for Intellectual Property, which consists of vendors who sell parts of an IC. These are processors like with ARM, or cheaper things like cores which implement various I/O protocols. They are sold as either hard - the actual layout for the block you plop down, or soft, which involves getting the source code usually in the form of Verilog. There is even one company that lets you build a customized processor and instruction set.
Lots of ICs today are Systems on a Chip (SoCs) which are a processor like an ARM core and bunch of other cores tied together, with some random logic thrown in.
Often even highly customized chips use IP for I/O, since there is little value added in designing one of these blocks yourself. They implement a standards, so you don’t get advantage from customizing it, and it is seldom a performance bottleneck.
That is the environment ARM operates in. I’ve never heard any of these companies accused of being patent trolls, and I thank the lawyerly types for clear definitions of what patent trolls are.
Executives running “real businesses” don’t refrain from patent litigation because they think it’s immoral. They refrain because it’s mutually assured destruction: anyone who makes any kind of nontrivial product is infringing on so many competitors’ patents that the endgame is negative-sum to everyone but the lawyers.
A requirement that anyone asserting a patent also own a “real business” is essentially a requirement that they contribute some hostages to that game of MAD, to give them an incentive against disturbing the balance of terror. It wouldn’t even have to be the same company: you could just require the owners of the NPE to also keep a certain fraction of their net worth in small “real product” businesses, with the understanding that any large company targeted by the NPE should retaliate by litigating those otherwise-unrelated small businesses into oblivion. Somewhere, some economist might find that elegant, but I’d trust him with neither civil defense nor the patent system.
It would be better to get the excessively broad patents out of circulation, through reexamination or tighter standards upon initial examination, since it matters much less who owns a “good” patent. That seems to be happening, though not very fast.
This.
There is a world of difference between a company that licenses others to make the things it designs and a company that buys designs made by others and then licenses yet other people to make them.
And the latter is a valid business model.
Patent Troll, IMO, refers to companies that buy spurious patents, patents that will probably not hold up in court, for the purpose of issuing legal challenges to other companies for infringement, then offering to settle out-of-court for less than the cost of mounting a defense.
While that is a viable method of making money, it is a reprehensible practice.
Well, the problem is that ARM is clearly a practicing entity. So there are NO definitions of “non-practicing entity” that apply to them.
As others have pointed out, the primary difference between reprehensible “trolling” and respectable business practice is motive, and nobody can be 100% sure about the motive of others. But we can make an educated guess based upon their behavior.
So while it is likely that one can’t create an empirical test for “patent troll”, and least one that doesn’t risk unfairly including some companies that aren’t, ARM is probably a bad hypothetical exaple, because they aren’t even non-practicing.
I don’t care if it is your primary method of revenue. That just impacts whether you are just a patent troll.
Being a patent troll who also runs a successful bakery is not really better. In fact, most of the patent troll companies I know of are owned by successful lawyers.
If Patent Trolling LLC is owned by Lawyers & Trolls Inc, which also owns The Lawfirm of Jones& Jones Inc, and more money comes from being lawyers than trolling patents, would that make them not trolls?
A Big Red Flag that is another of those could-also-be -used-by-a-legitimate-business things: they offer to settle for less than the cost of mounting a defense.
I recall one case where the defense entered into evidence that the plaintiff had explicitly* done that. As in, they had a letter from the plaintiff that said “Defending yourself against our lawsuit will cost you (X), but we will drop the suit if you give us (Y, which is less than X).”
Not damning in itself, but it was being used to show that the plaintiff’s business model amounted to extortion.
Perhaps another way to put it is that a non-patent troll uses (or at least is willing to use) legal threats as a tool to protect their main business model when necessary, while for a patent troll, legal threats are their main business model.
I don’t think it’s quite accurate to compare ARM to a fabless semiconductor company.
(Per Wikipedia) "ARM only creates and licenses its technology as intellectual property (IP), rather than manufacturing and selling its own physical CPUs, GPUs, SoCs or microcontrollers.
Each of the fabless semi companies sells its own chips.
(Some fabless semi companies may license some IP to others, but their business is built on selling chips)
Some parts of system companies, like Apple, are fabless. In fact unlike 30 years ago fabless is the rule not the exception.
And yeah, ARM is an IP company, not a fabless semiconductor company.
Some examples of non-fabless semiconductor companies are Intel, Texas Instruments, and Micron Technology. These companies have their own manufacturing facilities that they use to produce some or all of their own chips. They may also manufacture chips for fabless companies on contract.
There used to be a lot more including AT&T and HP - and I guess IBM has gotten rid of all their fabs now too. Ah, the good old days of vertical integration.
No, but so what ?
Is there any definition of “rock” that does not apply to “cheese” ???
So what if there isn’t.
That does not say that cheese is rock, but rather just highlights the “irreversability of logic”. To paraphrase Monty Python, All fish live in the water (live = reside in or very near… mud is watery.), but not all that live in the water (or mud) are fish. (whales are mammals, there’s also snakes ,worms, etc,etc)
By the same logic implied in the original post, then if the answer to “is there any definition of patent troll that does not apply to cheese ?” is “no”… Then all cheese can be described as “patent troll”…
Ah now whats so wrong with ARM not being into creating physical product ?
Lets look at RCA vs Farnsworth over the making of a TV system…
RCA didn’t want to miss the chance to be the TV people.
Farnsworth demonstrated how projecting electrons was far easier than projecting modulate light … He had a crude prototype of the CRT that were in homes for many decades… So he had a patent on that, and he went to a manufacture to get it MADE… So as to firm up his patent claims (back then you were best to MAKE it to CLAIM it… avoids 10 year long legal battles…)
So RCA went tot he manufacturer and said “So… you are supporting Farnsworth ? well then you can’t make Radios because we own the patents !”. The manufacturer then agreed that since they were making good money from radios, they were best to back out from assisting Farnsworth with TV’s. My point is that a manufacturer gets bogged down in old technologies, while an IP company is very flexible. Perhaps they preferred to give the image of being “ready for the future and fast to change to new technologies”. Because previous chip manufacturers have been Rockwell , TI, IBM, Motorola, with far too many vested interests and bosses who have risen through their lower tech areas, since that gives them more time to ladder climb…