Patent trolls more interested in threats than legal reasoning

Patent trolls can wreak havoc on any startup's plans. Just when things are going well, without warning, they can swoop in with lawsuits for thousands of dollars. Even settling out of court is enough to ruin many small companies.

That is why some startups refuse to settle and fight to the end.

FindTheBest.com was one such company. After developing a comparison-shopping website, the founders soon received a complaint from Lumen View Technology, which alleged that FindTheBest.com was violating one of its patents. If the company failed to pay a fee, Lumen threatened to begin a court battle.

FindTheBest.com founder Kevin O'Connor accepted the court challenge. According to an article in Bloomberg Businessweek, the entrepreneur had plenty of cash left over from his $3.1 billion sale of a startup to Google.

"If this were a business decision, we would have settled and written a check," FindTheBest.com employee Danny Seigle told the news source. But ultimately, it was the principle of the matter that affected the decision.

In fact, FindTheBest.com soon filed a counter suit against Lumen, alleging that the company violated the Racketeer Influenced and Corrupt Organizations Act (RICO). Considering that RICO was originally enacted to fight the Mafia in the 1970s, this was a serious charge. But documents from the case seem to back it up, suggesting that Lumen has little interest in determining how FindTheBEst.com actually violates its patent. Instead, it seems content to try to force a settlement.

Many patent trolls use the threat of legal action to get what they want, rather than the strength of the law itself. Startups should work with a Phoenix business attorney to beat them back.

Categorised in: Intellectual Property Law

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