It’s a common business tactic---the AFF gives them precedent to exploit.

Beyond the prior discussion of benefits arising from patent ownership, a relevant secondary consideration is the social cost that may arise from AI patents. More specifically, it is prudent to determine how these patents might be monetized and the societal impact arising therefrom. This concern is germane to a primary issue in modern patent scholarship, namely attempts to discourage the patent assertion entity (also referred to as “patent troll”) business model.288 The below discusses how AI patents might further troll litigation if these rights were allocated to software companies (in contrast to being allocated to AI users, as proposed herein).

Societal costs associated with patent troll litigation are substantial.289 Activity of this nature cannot proceed, however, unless trolls are able to purchase patents.290 That end is furthered where—as discussed below—patentees have no means of financially exploiting a patent except selling it. This would be the situation for many AI patent owners if patent rights were given to parties other than market participants (e.g., software companies).

There are limits on how software companies may monetize a patent. As specialized AI firms, these companies will not generally be engaged in commerce related to the field of the AI’s invention.291

This constrains their sources of patent value to licensing or sale of the patent,292 which in turn expands the market for discount patents (and thus, furthers patent troll activity). Such a conclusion is made clear though a discussion of avenues available for software companies to monetize their AI patent holdings.

In some instances, software companies might assign their patent to downstream AI users (e.g., firms licensing the use of the AI), and the patent is off the market.293 Likewise, software companies may sell licenses to use the patented technology and retain all substantial rights, including the right to sell the patent and sue for infringement.294 Neither of these situations create immediate worry.

Patent troll concerns arise where a software company (that has been allocated relevant patent rights) issues a terminal number of licenses and is left holding a patent which it has no intention or capacity to exploit in commerce.295 The economically rational choice at that point is to sell the patent for any non-zero sum.296 This can positively reflect on the bottom line without inhibiting the rights of past licensees.297 This act, however, additionally benefits trolls looking to purchase inexpensive patents.298