Glossary

You haven’t heard that word since the 3rd grade, have you?  Well, time to get out the way-back machine!

Term	Defined
Assignment History	A history of who has owned the patent over time.  A patent is filed by an inventor (or by a company or law firm on behalf of an inventor) and then it is issued.  The assignment history tracks who a patent was originally issued to, and then who it was transferred to over time.  An assignment history that might look like this:Ivan Inventor  – 5/4/1970 (the guy who was originally issued the patent) Acacia Media – 10/31/1986 (Acacia bought the patent from Ivan and now they own it) SQY Corporation – 1/11/2011 (SQY bought the patent from Acacia)This is important because it will show the ownership history of a patent, which is useful when trying to track down whether or not a plaintiff in a lawsuit is an NPE, or whether the patent was originally issued to an NPE.  It can also help determine the worth of the patent, meaning the more prestigious the former owners then perhaps the more costly it will be to buy it.
Claims Construction	The process of looking through a patent and checking to see if what the product or idea claims to do, or the problem it claims to solve, is actually true.
EDTX	The Eastern District of Texas, T. John Ward presiding.  A hotbed of intellectual property lawsuits because the judge and local juries typically award for the plaintiff.  NPEs often sue in this district and are often allowed to, despite the fact that the companies they are suing more than likely don’t even do business in the state of Texas.
EP	European Patent office
File History	The history of a patent from the time it was first filed.  Also called a “patent file wrapper”, it is the paper trail from the time the application was first made to when the patent was granted and issued.  It contains the original patent application, all subsequent claims construction, all revisions, everything having to do with that patent and it’s journey through the USPTO.
License	Company A wants to use a patented process or technology in the creation of their product. They determine who holds the patent, and negotiate the right to use the product or information for a fee.  This is called a “license” for the patent.  Companies can own a patent outright (and therefore license it’s use to others), or buy a license to use the patent.  Patents can be used only in the ways determined by the licensing agreement.
Markman Hearing	This is part of a patent infringement lawsuit.  It is the pre-trial hearing where the judge listens to the claims construction (see above).  The defendant would hope in this hearing that the court would find the patent claims are poorly constructed and issue a summary judgment for the defendant, meaning the lawsuit does not go forward.  This became common practice after a lawsuit in which Markman was the plaintiff and he argued that the language of a patent (it’s “claims”) were a matter for a judge to decide and not the jury.  This is why claims construction and how it’s done, and even who it’s done by, is so important.  It can make the difference between a defensible and “litigate-able” patent, and a weak and unenforceable one.
NCE	Non-Competing Entity – an operating company that does manufacture something using the patents that it owns, but also owns patents in unrelated industries and behaves like an NPE in those instances by litigating those unrelated patents.
NPE	Non-Practicing Entity – a company that purchases patents or patent portfolios with the sole purpose of suing other people for infringement.  That said, a distinction must be made for educational institutions, who often patent their inventions that occur in their labs.  They don’t sue people but are technically an NPE.  See “Patent Troll”.
Office Actions	Requirements of the USPTO to issue and renew patents.  These are tracked by patent prosecution companies/law firms and have specific requirements and dates associated with them.  For example, one office action is a “renewal date”.  You have to have the paperwork in to renew your patent within 90 days of the expiration date. If you do not file this “office action” in time, your patent will invalidate.
Open Market Acquisitions	Patents are an asset that can be bought and sold on the open market, just like commodities or other goods and services.  There are brokers who will market patents and portfolios similar to what real estate agents do for houses.  Patent defense aggregators often use open market acquisitions to acquire their portfolios.
Operating Company	aka, OpCo.  The companies who actually make products that use patented technology.  They have deep pockets and as such are frequently the object of lawsuits by NPEs.
Patent	A government issued protection order that says no one can use the process or technology or idea that you have submitted without first paying you to license it.
Patent Assertion Entity (PAE)	I guess we really need to go there. This is a term used to ferret out true Patent Trolls from the NPE subset. Since an NPE is defined as an entity that holds patents but does not make anything, we need a way to distinguish universities and other non-litigious entities from the trolls. We sort of had already done that, if I’m not mistaken, in the use of the term “Patent Troll”. But I suppose if we’re going to anesthetize everything instead of calling a spade a spade, then this term satisfies that goal.
Patent Prosecution	The process of moving a patent from the application stage to the issued stage.  There are different dates associated with the process such as the filing date, the issue date, granted date, etc.  These are important because there are actions (called “office actions”) that have to occur at different points in the process in order for a patent to stay current.  Companies pay law firms to “prosecute” their patents, that is, to make sure that all the paperwork is filed at the right time and their patents are issued correctly and that they don’t lapse.
Patent Troll	A pejorative term for NPEs.  The term “NPE” came into vogue because there are some companies (namely, educational institutions) who buy patents and who patent their own inventions, but have no desire to litigate over them.  A good way to look at is that a Patent Troll is always an NPE, but an NPE is not necessarily a Patent Troll.  (Venn diagram waiting to happen.)
Portfolio	Or Patent Portfolio – a group of patents bought and sold together as one unit.  Usually related to the same technology, product, or market sector.
Prior Art	Anything that shows that something someone is trying to patent or has successfully patented has been done before.   Most often used in the context of a “prior art search”.  This is what operating companies do when they are sued for infringement: they will go out and look to see if anyone has done this before so that they can invalidate the patent during litigation (or hopefully prior to it and resolve the case out of court). This is also part of the patent prosecution process: the company or law firm that is helping you get your invention patented is supposed to do a thorough prior art search so that when they apply for a patent, it will actually be issued and defensible.
Re-exam	When someone finds prior art that may invalidate a patent, a request can be made that the USPTO re-evaluate the claims in the patent and determine if it should have been issued and is still a valid patent.  This is important because a lot of what NPEs sue over are weak patents that most likely never should have been issued.  It costs money to find the prior art, and then more money to file for a re-exam.  Both of these together, however, could still be cheaper than the cost of litigation.
USPTO	United States Patent and Trademark Office, the government office responsible for issuing patents.

Updated: April 3, 2013 Now, with more borders!