How to Find a Patent Troll

Some thoughts on systems and methods

Today, I’m going to show you five ways to figure out whether someone who files a patent lawsuit is a patent troll.

One of the types of posts I’ll be sending out in this newsletter will take a big-picture look at patent litigation in the U.S., starting in January of 2021. Here’s a spreadsheet I made of all 37 utility patent lawsuits filed in the first week of the year. 

Who’s filing these lawsuits? Where are they being filed? What technology are the parties fighting over? And finally, why are there so many of these disputes? 

Most patent lawsuits in the U.S. are filed by companies that don’t do anything except threaten people over patents. This was true last year, it’s been true for well over 10 years now, and it’s a pretty fair bet that it will be true in 2021. It’s a perennial fun fact that I am obsessed with. In the tech sector, these do-nothing companies are often called “patent trolls.” In the legal field, people also use nicer terms, including non-practicing entities (NPEs) and patent assertion entities (PAEs). In this newsletter, I’m primarily going to call them NPEs. 

Of the 37 lawsuits filed in the first week of the year, 19 of them (51%) were initiated by non-practicing entities. 

In today’s newsletter, I’m going to explain how I examine a patent lawsuit and identify patent holders that are NPEs, in an effort to open-source my own methodology early on. It’s more art than science. 

Important caveat: I am reliant on public information, and while I think I was pretty careful, I do make mistakes. I welcome any corrections that are based on verifiable information. The scope of this project doesn’t allow me to contact many parties directly. But to be clear, I’m happy to discuss the cases I list here, with the parties or their attorneys. I can be reached via email at joe@letterspatent.org

The Case of Caselas LLC

As an example, let’s take the plaintiff that filed the most cases this week. As you can see on the spreadsheet, a single plaintiff, Caselas LLC, filed five different lawsuits in the Western District of Texas. On Jan. 6, Caselas sued UBS Bank USA (6:21-cv-00006), Volusion LLC (6:21-cv-00007), Prosperity Bancshares, Inc. (6:21-cv-00005) and Farm Bureau Bank, FSB (6:21-cv-00004). The following day, Caselas sued BBVA USA Bancshares Inc. (6:21-cv-00011). 

The lawsuits all allege infringement of five patents that Caselas says cover financial systems that warn about credit card chargebacks. The earliest two patents are 7,529,698 and 7,661,585.

Technique #1: Let Me Google that For You 

How can we learn more about a mystery company like Caselas? First, we Google it. Really. 

If we see an entire page of links relating to patents and patent litigation, and not a single link that seems to point to a website owned by the company in question—well, that’s a pretty good sign the company’s main business is patent lawsuits. 

And indeed, every one of the top links that come up in my search for Caselas are related to the company’s patent litigation. The same is true for nearly all 12 of the NPE’s I identified in this week’s chart. Even the two NPEs that have only filed one case each don’t have active websites that come up in a Google search. 

It’s weird to not have a website. Almost everyone selling things has some Web presence these days. If the thing you’re selling is software—and most of these NPEs are suing over software products—then you definitely need a website. 

Some NPEs do have websites. They might be “once upon a time” companies featuring decade-old press releases, or “I swear I’m gonna have something soon” websites promoting a product that’s coming… one day. 

But most don’t bother. And why should they? Creating an LLC to threaten or sue people over patents has become an accepted fact of life in federal courts. As I explained in an earlier post, I’m not a fan of this activity, but we should be clear that it’s perfectly legal. 

Technique #2: Count Up Lawsuits 

Companies that actually produce goods or services don’t typically sue a lot of other companies. It’s an expensive drain of time and money from whatever your business is. 

It’s also really hard to run an actual business and maintain relationships when you’re in constant legal battles. Even when there’s no love lost between competitors, it’s pretty unusual to see a legal assault launched against three or four companies in the same industry at once. 

Looking at Caselas LLC, we can see this company has already filed 13 lawsuits—within one month! Of the 12 companies that appear to be NPEs in this chart, 10 of them have filed multiple patent cases (4 or more), with some having filed dozens.

Repeat litigants often stretch the claims of their patents beyond belief. In some cases, NPEs are suing throughout an industry, claiming that multiple independently created systems infringe their patents. 

Operating companies have certainly launched major patent litigation campaigns, but it’s rare. 

Technique #3: Check the Address

Most of the time, the company shows an address on either its legal complaint, or the corporate paperwork it files with the Secretary of State in its home state, or both. Look up the address. Is it a residential address, a virtual office, or mailbox shop like a UPS store? Those are signs of a non-practicing entity. It’s not impossible to have a home-based business that produces goods and also is making a case for patent infringement, but again, pretty unusual. 

Caselas LLC, for instance, is based in a Palm Beach condo. What’s more, the same address is used for other NPEs, which appear to have the same owner. 

Other NPEs follow a similar pattern. Looking at this week, Media Chain LLC is based at a UPS store in Miami; Dual Control Systems is based at a residential address in New Jersey; the address for both Rothschild Broadcast Distribution Systems and Scanning Technologies Innovations LLC is a virtual office in Miami. Lightside Technologies’ address is its registered agent in Texas. 

Technique #4: Check the Venue 

Was the lawsuit filed in a district court that’s become popular for patent owners, but has no obvious connection to the plaintiff or the defendant? It used to be that filing in the Eastern District of Texas was beneficial to NPEs, but the new popular district is clearly the Western District of Texas. Here’s a good explanation from Patently-O on the rapid rise of W. D. Texas

About one-third of the lawsuits (13 out of 37) in the week we’re looking at here were filed in West Texas, making it the most popular district by far; Delaware was a distant second, with 5 cases. Looking solely at the 19 NPE cases, 11 of them (58 percent) were filed in West Texas. 

This is a small clue, since the same venues that are popular with NPEs are also popular with big companies. Samsung’s lawsuit against JOLED and Asustek, for instance, is based in West Texas. 

Technique #5: Check the Patents

Reading patent claims is painful. Saying they’re written in “legalese” doesn’t do justification to the damage these documents have done to the English language. Sometimes they’re just indecipherable to non-patent professionals (and that includes me). 

But one thing to look for is whether they use fancy techno-language to dress up the fact that the patent claims really just describe things that happen in everyday life, like watching an ad or mixing a drink. In their complaints, patent owners will have to describe not just their own patent claims, but also must detail the specific products they believe are infringing. So, that also gives a better (and often, more readable) idea of what they think their patents cover. 

Were the patents transferred around repeatedly? Some NPE patents have been sold repeatedly. The patents originate with operating companies but have long moved on. 

If the patent hasn’t moved around much, who’s the inventor? Every patent has a named inventor. If the inventor is the employee of a company, their patents will typically be assigned to the employer. But lots of NPE patents stick with the original inventor, who has made a career out of threatening people over their patents. 

In the case of Caselas, the name of the inventor, Raymond Joao, is a strong clue. Joao is a New York patent attorney with a very long history of patent lawsuits. His cases have been highlighted by EFF’s Deeplinks blog and Techdirt, among other publications.

In fact, several of the NPEs from this week are run by inventors with long histories of patent lawsuits, including including Scanning Technologies Innovations (inventor Leigh Rothschild), Rothschild Broadcast Distribution Systems (Leigh Rothschild again), Transcend Shipping Systems (Raymond Joao again), and William Grecia (who has filed more than 60 patent lawsuits under his own name). 

Other NPEs aren’t inventor-controlled. Display Vectors LLC has patents that originated at Samsung and Ricoh; Proven Networks LLC has patents that originated at Lucent Technologies. 

Why does this matter? 

In my opinion, serial patent litigants are bad for citizens, bad for the economy, and often make claims that are simply intellectually insulting. They undermine the Constitutional rationale for our patent system, which is that the limited monopolies of patents should only be granted to “promote the progress of science and the useful arts.” 

Let’s be clear, not all the harm comes from NPEs. If a company does nothing but litigate patents, in my opinion, that’s bad. But if a company does make something, but is still focused on filing patent lawsuits, rather than inventing—well, that’s bad too! 

Even in the first week of the year, we can see lawsuits that I have not designated as NPEs that could be very problematic. Of the 9 “small company” lawsuits, 5 of them are filed by very litigious plaintiffs. Reading the complaints of the patent-holders I marked as “individual,” it’s not clear what, if anything, those patent owners are contributing to the state of the art.

Still, it’s important to look at NPEs, if nothing else because they are the majority of patent lawsuits. I don’t think a company like Caselas LLC “promotes the progress of science,” and after 13 years, I’ve never heard a convincing argument to the contrary.


That’s it for this week. In subsequent letters, I’ll categorize the rest of the January patent lawsuits, and write more in-depth on a few interesting NPEs. But I hope it was helpful for me to “open source” how I look at these cases. 

I appreciate feedback, as well as tips about what I should cover here—both NPE-related and not. You can reach me at joe@letterspatent.org

Image: Troll Hunter by James Shields, CC BY-NC-SA 2.0