Patent Troll Withdraws Lawsuits

by Michele McDonald April 03, 2014

MacroSolve Inc., a “patent assertion” entity, voluntarily withdrew all outstanding lawsuits related to its patent after the U.S. Patent and Trademark Office rejected its claims.

A patent assertion entity is a company that makes money primarily by suing other companies for patent infringements and obtaining settlements in the form of “licensing agreements.” They are often called “patent trolls.”

68 companies
Since 2011, Tulsa, Okla.-based MacroSolve has sued at least 68 companies for patent infringement. Twenty-two of the companies it sued are in the travel industry.

Many of the cases were settled out of court, as is common in such cases due to the cost of litigation.

But about a dozen cases remained open, including lawsuits against American Airlines and Carlson Hotels.

In addition to American and Carlson Hotels, MacroSolve had sued Avis Rent A Car System, Continental Airlines, the Hertz Corp., Hipmunk Inc., Hotels.com, JetBlue AirwaysMarriott International, Priceline.com, Southwest Airlines, Travelocity.com and United Airlines.

Two fight back
Two of the defendants chose to fight back.

Newegg, an online electronics retailer, and GEICO, the insurance company, challenged MacroSolve’s claim that anyone who distributes electronic forms over the Internet or to mobile devices and then collects and reviews the responses could be liable for infringing its patent.

Patent history
MacroSolve claimed that it “pioneered” technology that allows the collection and transmission of customer data between the owner and the user of a mobile application.

The patent was awarded to MacroSolve in October 2010.

The award of the patent to MacroSolve immediately raised the hackles of several patent consultancies and analysts, who said that exact technology did not exist when MacroSolve first filed for a patent in 2003 and that its patent application was modified several times between 2003 and 2010.

What’s next
In a recent filing with the Securities and Exchange Commission, MacroSolve said it had two months from March 7, the day of the patent office’s action, to ask the patent examiners to reconsider the action.

If the request is denied, it can appeal. In the meantime, however, it is not allowed to pursue litigation.

In a statement, Lee Cheng, Newegg’s chief legal officer, said, “Fighting back works. We killed the troll.”