Patent Troll

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DEFINITION of 'Patent Troll'

A derogatory term used to describe people or companies that misuse patents as a business strategy. A patent troll obtains the patents being sold at auctions by bankrupt companies attempting to liquidate their assets, or by doing just enough research to prove they had the idea first. They can then launch lawsuits against infringing companies, or simply hold the patent without planning to practise the idea in an attempt to keep other companies productivity at a standstill.

INVESTOPEDIA EXPLAINS 'Patent Troll'

The name originates from an educational video released to corporations in the early 90's. The goal of the video was to alert corporations to the newest scandal in business, as well as to dissuade potential future trolls. The video depicted a troll rushing into the patent office stealing the patent from the rightful owner.

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