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Patent trolls are about as popular as ticks or tapeworms but, even by this standard, Personal Audio LLC is especially reviled. The East Texas-based shell company, which doesn’t produce anything but lawsuits, decided an old patent gave it a monopoly on “episodic content” and the right to sue every podcaster in the country.
On Monday, a legal filing confirmed that the troll met its match in Adam Carolla, a popular comedian who decided to wage a legal counter-attack against Personal Audience and stomp its patent into the ground with the help of a crowd-funded legal defense fund.
In a court filing in East Texas federal court, Carolla and the troll stated they would dismiss all claims against each other and, for now, to keep their mouth shut about what exactly happened:
“With the exception of the press release announcing the settlement that has been approved by the Court, Personal Audio, Lotzi [Carolla’s company] and the Partnership shall not make any public statements, issue any press releases or otherwise issue public comments,” read a court filing, which was reported by the Electronic Frontier Foundation.
As the EFF points out, however, the filing is not all good news since it will leave Personal Audio and its patent alive, and will also preclude Carolla from sticking the troll with its legal bills.
Unfortunately, this is all to common when it comes to patent trolls: even when their victims win, they lose. Despite Carolla’s vow last month not to settle, it appears that he grew weary of the fight — perhaps recognizing it would be a long-shot to recover his legal fees in the patent troll paradise of East Texas.
The upshot is that Personal Audio didn’t succeed in its shakedown against Carolla, but nor will it pay anything for losing. Such are the economics of patent trolling: shell companies can file quick and dirty lawsuits at little cost to the troll, but that can be ruinously expensive for the victim to defend. As a result, the victims decide to pay up or settle, and the troll moves on to the next target.
There are, at least, a few bright spots in this case. The EFF, for instance, is pressing on with a related legal campaign to invalidate Personal Audio’s patent and defang it for good, and the settlement with Carolla is a reminder that trolls can be driven away. More broadly, there are already signs that a recent Supreme Court case that makes it easier to collect legal fees from trolls is having some effect.
Still the situation remains unsatisfactory. While certain trolls suffer setbacks, the overall business model remains intact, thanks in no small part to Senate Democrats’ failure to pass a patent reform bill this spring. This means that companies, including podcasters, will have to simply hope that the trolls will give up on their greed, and move onto real businesses instead.