Trolling Along The Perimeter Of the Invention.

By now, surely you’ve read that “patent troll” has no accepted and ordinary meaning (what to do, request a Markman hearing?).  Most of the attributes are defined perjoratively, but each new case or ruling reasks if those perjoratives apply.

A recent jury verdict, of not infringed, invalid and unenforceable, was noted in Barry Fiala, Inc. v. Stored Value Sys., Inc., Civ. 02-2248 (W.D. Tenn).  Some of the ‘tips from the trenches’ were that it might take 4 years of litigation and 15 days of trial to determine whether a cardboard “panel” for holding a gift card infringes a valid patent, or not.  Fiala has a series of these suits, several in Tennessee and others in Minnesota, which accuse distributors of gift cards of infringing his `029 patent that claims a card holder “having an outer perimeter” and methods “to activate” the gift card while it is “secured” in that packaging.  It compares to the cardboard hang-tag that the clerk bends back, exposing the magnetic strip, when your calling card or -tunes card is activated.

Some would argue that the innovation of the encoded gift card should not be burdened with infringement suits over the cardboard hang-tag used to merchandise it.  For that, or other reasons, a jury in Tennessee gave a verdict against Fiala.   The docket in that court shows that several other suits were filed, then sat for 90 to 180 days, and then were dismissed, which suggests that Fiala got settlement value for his patent.  Defendant Stored Value Systems chose to litigate, and won at trial.  One assumes that the hang-tag, fold-back, etc., packaging is essential to the business of both parties, and so, defending the suit and the validity of the patent was necessary.  Even so, it took years, over 400 docket entries, and a long trial.  Was this a troll case?  If it’s what you patented and sell, then who can blame you for litigating it.

Before issuing the next, unqualified, freedom-to-practice letter, it is fair to ask the client, “what packaging or distribution means will be used to market this unique invention,” and to ask those around you, “did we search that art?”