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The Biggest Scourge on the Tech Industry

A patent infringement lawsuit was recently filed against a well-known “B-list” celebrity.

However, when it was discovered that this celebrity doesn’t make much money, the lawsuit was dismissed.

End of story, right? Wrong!

The celebrity in question rejected the dismissal, and insists on being sued.

It’s an interesting case that has the potential to disrupt the entire tech market.

The celebrity is comedian Adam Carolla.

Carolla stands accused of infringing on Personal Audio, Inc.’s patent on podcasts.

So why is Carolla insisting on being sued, even though Personal Audio has agreed to dismiss the case?

It’s simple, really.

Personal Audio is nothing more than a patent troll. That is, a company in the business of abusing the legal system for financial gain.

The company’s patent – granted in 2012 – says that it invented a “system for disseminating media content representing episodes in a serialized sequence.”

In layman’s terms, Personal Audio is claiming to have invented the podcast, without ever actually broadcasting one.

Carolla is presently raising legal funds so he can pursue a counterclaim in court, which includes a demand that Personal Audio’s patent be nullified so that it can’t sue other podcasters for infringement.

The Costly Truth About Trolling…

Patent trolls are inflicting more damage than you can imagine.

Here’s how the trolling process typically plays out…

First, the troll files a patent that coincides with a nascent technological trend, like, say… cloud computing.

Next, when the patent is granted, the troll lies in wait while the industry gains market traction.

Then, when their targets begin realizing revenue, the troll pounces like a wolf on a fresh kill.

The companies most pursued by trolls are Apple (AAPL), Hewlett-Packard (HPQ), Samsung (SSNLF), AT&T (T), Dell, Sony (SNE), HTC (HTCKF), Verizon (VZ), LG (066570.KS), Google (GOOGL), Amazon (AMZN), and Microsoft (MSFT).

The damage assessment is pretty ugly.

Over a recent three-year period, PR Newswire reports that patent lawsuits reduced the capitalization of targeted firms by an estimated $83 billion per year… an amount equal to more than one-quarter of the annual U.S. industrial R&D spending.

Another study estimated that such infringement lawsuits gobbled up more than $500 billion in wealth over a 20-year period.

Worse yet, trolling is gaining popularity.

Patent Cases Rise in Lockstep with Patents Granted

Even though most of these cases either get dismissed or settled out of court, the trolls win a lot of the cases that go to trial.

The Next Likely Troll Target…

Energy harvesting is an exploding industry. In fact, it’s perhaps the hottest industry in the world.

The trolls, no doubt, have already figured this out.

Let me put the industry’s explosive growth in perspective for you…

Two years ago, had you rolled the entire energy harvesting industry into a single company… that company wouldn’t have been big enough to get listed on the S&P SmallCap 600 Index.

However, analysts now project that the industry will be worth $4.2 BILLION in a few short years.

The core mission of energy harvesters is to create a battery-less world. That is, since batteries are impractical, costly, and often dangerous to dispose of.

Some of the technologies coming online are breathtaking, to say the least. (See them here.)

Energy can be harvested in a multitude of ways, from biological reactions, heat (thermovoltaics), light (photovoltaics), water (hydropower), and even movement (piezoelectrics and electrodynamics).

Patent trolls and investors alike stand to make a lot of money off of the energy harvesting industry. On such merits, I just filed an entire briefing on it, including a few ways to play it.

I encourage you to review it here.

Onward and Upward,

Robert Williams

Robert Williams