The Lawlessness of Legal Efficient Infringement

Efficient infringement is a relatively new term in the patent world. While it is not a new phenomenon, it has become more serious in recent years, causing more and more inventors to give up on much of their life's work and projects.

What Does Efficient Infringement Mean?

Efficient infringement is when big companies consciously choose to illegally use patented intellectual property because it is cheaper than paying to license it. They deliberately ignore the patent and its inventor. They just implement the invention into their products for their own benefit, take the chance that patent owners will not have the means to sue, and pay any legal fees entailed if the patents owners do sue. Big companies with deep pockets are able to promote their products and make astronomical amounts of money at the expense of smalltime inventors who do not have many resources available to them.

Why Is Efficient Infringement Such a Big Deal?

Efficient infringement is a grave offense because such behavior involves corporations intentionally stealing from smaller inventors, who spend years developing and perfecting a technology or a product. These corporations know about the wrongfulness of their actions from the outset, yet they don't care. They calculate that the risk they take is worth it. In other words, it is more cost-effective to break the law and pay the necessary repercussions after, than it is to work together with the patent owner and strike a deal beneficial to both parties. This creates a Wild West of intellectual property, where anyone can disregard the law as they please. However, it is painfully obvious that the ones behaving in such a way are the ones who can afford to do so, thus destroying the American work ethic, ingenuity, and a free market in the process.

Moreover, as a consequence of efficient infringement, the private inventor loses far more than the licensing profits or the patent itself. By undercutting the proper functioning of the patent system, efficient infringement thwarts the potential of reward and compensation to innovators for their inventive labors. The more frequently efficient infringement occurs, the less inventors will want to create patentable inventions, since they will realize that the legal system is essentially working in an unjust manner against them. And without the legal protection of effective property rights, venture capitalists will not have the confidence to invest in inventors or startups, and the innovation economy will suffer.

Can't Inventors Just Sue the Infringers?

Due to patent law reform, a court of law will not automatically grant permanent injunctions to victorious patent owners as a matter of right. Meaning, even after the inventor has spent years in court, spent boatloads of cash, and perhaps succeeded in proving that the infringing parties deliberately violated the terms of the patent, there is no guarantee that the court will force the infringing parties to stop.

Without fear that a patent owner can obtain a permanent injunction and with the US Court of Appeals for the Federal Circuit having dramatically decreased available patent damages, the only thing infringers have to fear is paying a reasonable royalty. This is approximately what they would have paid anyway, had they negotiated over licenses prior to litigation. And this is still only assuming that patent owners have the means to pursue the infringers legally to the point of winning at trial.

What Are the Implications of Efficient Infringement? In Other Words, Why Should You Care?

You might suppose this is a non-issue for you. Either you're not an inventor, or perhaps you feel that you have been sufficiently successful at protecting your assets and obtaining licenses. But efficient infringement is corroding the foundation of American ingenuity. The legal rights of the little guy are being eroded by large companies with enormous legal departments and pockets. That presents a problem to all of us.

This kind of blatant disregard for the rights of hardworking Americans should concern every law-abiding citizen for one simple reason: Where does it end? You may not be overly worried about burglars perpetrating their crimes in a city that isn't yours, right? But how about when these same burglars make headway into your neighborhood and then to your street? Is it not just a matter of time before they target your home?

Efficient infringement is really not all that different. To some, it may seem pertinent only to a certain niche of inventors or developers. However, the more prevalent this abusive attitude becomes amongst large corporations and throughout our legal system, the more we risk it encroaching in on the rest of our rights.

What Can Be Done?

Raising awareness about efficient infringement is most certainly an important step. Many people don’t realize this exists. Even if they do, they may believe the legal system will adequately protect patent owners and force infringers to compensate them for all loss of profit. They don’t realize, as explained above, that injunctions are not a given in the patent legal system.

Therefore, the most beneficial immediate step is to pass on this information, be it to your fellow innovators or your local congressperson. Because as long as efficient infringement remains lucrative, there is nothing stopping your life's work from becoming a mere bolt in a big corporation's machine.