[acdha]

> subscription-based nonprofit that pools legal expenses and member patent portfolios and fights defensive cases on behalf of startups and small businesses.

You might find this interesting: John Walker, one of the Autodesk founders, tried to popularize the same idea in the early 90s:

http://www.fourmilab.ch/autofile/www/chapter2_105.html

Unfortunately, too many companies didn't want to give up the option to sue and the rise of the limited-liability shell company made it pointless as there's no point in counter-suing a company with no assets which will fold if any counterattack succeeds.

[allochthon]

Thanks for the link.

the rise of the limited-liability shell company made it pointless as there's no point in counter-suing a company with no assets which will fold if any counterattack succeeds.

Wouldn't that get rid of the troll? Also, would it be possible to seek legal expenses from the shell corporation's creditors?

[acdha]

> Wouldn't that get rid of the troll?

That depends: in some cases it appears that they've tried things as blazen as having a shell company which licenses the rights to sue for a patent but doesn't actually own it. If the shell goes bankrupt, the only “asset” is that right to sue, not the actual patent, and the people involved are free to simply try again later.

If you haven't looked at this before, This American Life had a two part series with a good general examination of the system – spurred by a troll running around suing everyone who podcasts:

http://www.thisamericanlife.org/radio-archives/episode/441/w... http://www.thisamericanlife.org/radio-archives/episode/496/w...

> Also, would it be possible to seek legal expenses from the shell corporation's creditors?

That's a really important question. The assumption has been no but there have been attempts to try RICO cases[1] and it sounds like the entire legal climate is getting more sympathetic to the idea that what we're seeing is extortion, pure and simple. Most of the legislation floating around Congress at least made some attempt to deal with this part of the problem but, of course, none of that counts until something is actually close to passing.

1. e.g. yesterday's story: http://arstechnica.com/tech-policy/2013/11/findthebest-destr...

[DougBTX]

No, the first shell company just needs to sell the patent on to a new shell company, which can then start over.