This makes me wonder: is there any downside to enacting laws to make patent invalidation due to them being overbroad applicable retroactively and forcing Blackbird to return the money it extorted? It might be challenging to enforce due to limited liability, but I don't see any obvious downsides to trying? It seems like it could provide an incentive for companies to not attempt to create over-broad patents.
Why? If it is ruled invalid today then it was also invalid the day it was issued. I would imagine any company who paid for a license under threat of suit would now be telling their legal department to file a suit to reclaim the fee paid plus interest plus any provable damages. So we already have a remedy for this situation, no need to complicate the statutes.
Yeah, I wish there were a special place in hell reserved for patent trolls, but undermining contracts retroactively is not something to be taken lightly.
Not sure that it would be undermining contracts retroactively.
IANAL, but the approach I'd consider is fraud/breach of contract. The previous victims settled and paid a royalty to use a patentable technology. It turns out that it was not what was represented. Ergo, refund. How it plays out surely depends a lot on regional courts, precedents, etc.
I wonder how air-tight you can make that reasoning. I suspect you could structure the settlement as paying to use the underlying technology _including_ the patents etc., rather than licensing the patent per se (so the fees paid are not directly predicated on the existence of a patent).
Be interesting to see how the courts would react to that though, and if they see it as a sign you are negotiating in bad faith.
It's not retroactive if you know about it ahead of time. It would be known when the contract is made that the money would by law have to be returned in the event the patent is invalidated.
The consequence would obviously be that all the licensees of a patent that has any chance of being invalid would subsequently try to get it invalidated so they can get their money back, but isn't that the intended result?
> We have a concept in US Law called “ex post facto” which means you are not liable after the fact if laws are changed.
That's not what ex post facto means. An ex post facto law is a law criminalizing an act or increasing criminal penalties after an offense occurred. It does not prevent retroactive civil liability.
The more applicable concepts here are the binding nature of contracts (which settlements are) and res judicata (which means that, in short, once a court judgement has been entered and made final, a party cannot relitigate it to get a better outcome.)
There is benefit to making settlements and final judgments final. Otherwise you are incentivizing constant re-litigation of the same issues. It would also make trolls less likely to settle in the first place.
You can put such terms inside your own settlement agreements. One common way is to use a running royalty rather than a lump sum royalty. If the patent is ever invalidated, you can stop paying.
Patent trolls are separate companies with ~zero assets outside of the patent. Think sock-puppet internet accounts.
They can just pay out any income as soon as it shows up so there is nothing to recover if their patent is invalidated.
PS: The only way to make this work is if you pierced the corporate veil when their patents where invalidated, and that would make patents even more useless to small companies.
I don't think piercing the corporate veil is the only possible solution, you could legislate that revenue from unlitigated patents couldn't be taken out as profit. Again, that might not be enough and the exact wording would need work, but I think that making it possible is the first step to making it practical.
Personally I think we should just abolish the entire patent system, since I really don't see much benefit in it for anyone but large companies, but basically everyone agrees on stopping patent trolls with garbage patents
