As Patent Suits Increase, Firms Fight Back

The general counsel of Rackspace, a web-hosting company in San Antonio, does not mince words when he discusses patent litigation.  

“It’s a shakedown,” Alan Schoenbaum said. “It’s extortive behavior.”

The subject of his rancor, which is shared by many in the software industry, is litigation by patent assertion entities that are known derisively as “patent trolls.” Their tactics are simple and legal: Collect dormant patents, then file suit in federal court against companies, claiming infringement, to extract licensing fees.

Advocates of patent reform say the legal system unfairly favors the entities and have called on federal ...

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