This Essay is the first analysis of a recent entrant on the patent landscape: the Invalidity Assertion Entity (IAE). IAEs engage in rent-seeking by demanding payment from patent holders in exchange for not attempting to invalidate their patents through administrative action before the U.S. Patent and Trademark Office. The response to IAEs has been uniformly negative. Reflexive proposals have been raised in Congress (unsurprisingly) to terminate the IAE business model. In contrast to the common response to IAEs, this Essay discusses how profit-driven IAEs may generate socially beneficial externalities and why legislating to end the IAE business model is imprudent.
W. M. Schuster,
Rent-Seeking and Inter Partes Review: An Analysis of Invalidity Assertion Entities in Patent Law,
Mich. Telecomm. & Tech. L. Rev.
Available at: http://repository.law.umich.edu/mttlr/vol22/iss2/3