Yesterday, the U.S. Federal Trade Commission (“FTC”) released a 269-page Report following its study of patent assertion entities (“PAEs”) — i.e. what the FTC’s press release calls “firms that acquire patents from third parties and then try to make money by licensing or suing accused infringers.” (see our Sep. 27, 2013 post, May 21, 2014 post and Aug. 14, 2014 post for background on this PAE study). The report is based on a study of public information as well as non-public information that the FTC used its subpeona power to obtain resulting in data covering the 2009 to 2014 period from 22 PAEs, 327 PAE affilidate and over 2100 holding entities (entities that owned but did not assert patents).
The report indicates that not all PAEs are the same and concerns about PAEs should be focused on problematic behavior of a subset of PAEs–i.e., certain Litigation PAEs, but not Porfolio PAEs. The report also indicates that there is no widespread concern about PAEs sending demand letters or PAEs owning standard essential patents subject to a FRAND or other standard setting licensing commitment. The report provides some recommendations concerning patent reform, which are directed to patent litigation and the behavior of some Litigation PAEs.
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