The Adam Smith Institute’s Senior Fellow, Keith Boyfield, wrote an op-ed for CityAM about the threat patent trolls pose to markets.
LONDON’s technology sector is booming. Driven by big venture capital investments (tech firms attracted a record $1bn in the first nine months of 2014), and encompassing everything from finance to fashion, it is one of our greatest recent success stories. But this nascent sector also faces a worrying potential threat. A fresh menace to the workings of efficient markets is rapidly gripping the global tech industry, and it threatens to stifle innovation, raise prices, and constrain choice for consumers across the globe. The threat has been dubbed “patent privateering” and its impact on effective competition is already alarming.
Patent privateering refers to the practice whereby corporations wanting to defend their market share enter into private agreements with patent assertion entities (PAEs), or patent trolls as they are more commonly dubbed. These PAEs are effectively special purpose vehicles with no manufacturing capabilities; they are created to enforce patent rights and sue people. The more, the better.
Read the full article here.