Previously I posted on the issue of proxy patent litigation. Basically, mass patent aggregators (entities which own or control a large number of patents that they have acquired from elsewhere) litigate only a few of the patents in their portfolio against a large accused infringer. The litigated patents serve as proxies for the quality of their entire portfolio. If the aggregator is successful on the merits (or at least in preliminary rulings, such as defeating the accused infringer’s motions for summary judgment on invalidity and non-infringement), it strengthens their hand considerably in negotiations for a license for the entire portfolio. The proxy litigation is also only one part of a broader dynamic from the aggregator’s perspective: the aggregator’s success in court against one practicing entity not only puts it in a stronger bargaining position against that entity, it may also do so with the rest of industry as well (i.e., other firms may be willing to pay more for a portfolio license).
I now attempt to answer a question I posed in my previous post. Specifically, if the court understood the underlying dispute was litigation-by-proxy, would it (or could it) proceed any differently?
I think it is useful to consider this question through the prism of the classic project management triangle. According to theory, a project has three core attributes: speed, quality, and cost. There is tension among the three attributes, and consequently, one can never maximize more than two of them. For instance, if one wants a project of the highest quality in the fastest time, then it can’t be cheap. Alternatively, if one wants a project fast and cheap, then it can’t be of the highest quality.
Now let’s translate the project management triangle into the judicial process. Several core attributes of a case are speed of resolution, depth and thoroughness of the analysis, and accuracy or correctness of the decision. If the project management triangle is correct and applies to the courts, then all three of these can’t be maximized at once. While the court and litigants want speedy, thorough, and accurate justice, not all are possible in a case.
Now turn back to the proxy litigation by patent aggregators. I submit that the optimal level of speed, thoroughness, and accuracy may be different in proxy litigation than run-of-the-mill litigation. The depth and thoroughness of the opinions may be of less importance in proxy litigation because the adjudicated dispute is not the entire dispute between the parties. Accuracy may be more important since the results of the single dispute will be used to determine the value of a larger portfolio.
Thoughts on the analysis?