Poor patent quality incentivizes patent trolls.
Stefan Lederer ’21 [June 22, 2021; CEO and Co-Founder of Bitmovin, a company providing cloud-based OTT video software solutions for leading media companies worldwide. “The Growing Problem Of U.S. Patent Trolls, And What Should Happen Next,” Forbes; https://www.forbes.com/sites/forbesbusinesscouncil/2021/07/22/the-growing-problem-of-us-patent-trolls-and-what-should-happen-next/]
The patent system ensures that innovators see return on their investment, and that provides the incentive necessary for them to expand the scope of human understanding and share that knowledge with the world. However, the patent system, like all other human institutions, is vulnerable to abuse. This abuse is most notable in the form of low-quality patents that are asserted against innovative companies by entities that often don’t even make any products. The worst of these patent trolls pick up low-quality patents and take advantage of asymmetries in the economics of litigation to make quick cash. Bitmovin has been on the receiving end of several of these dubious suits, which are a very real threat to innovators and other startups. Some studies have estimated that 30% to 40% of issued patents are invalid or low quality.