Op-Ed: Patent trolls threaten tech companies and Austin’s vibrancy
By: Emil Sayegh, Austin American Statesman
The Internet is the fuel that powers our current economy — ever growing, and allowing new industries and ideas to emerge every day. And a lot of that is happening here in Texas.
According to the TechAmerica Foundation’s Cyberstates 2013 report, the Internet and high tech jobs provided a whopping 486,600 careers for Texans in 2012.
This month, the biggest names in the Internet industry will gather in Austin for HostingCon. Many of these companies, including Codero Hosting, are also members of the Internet Infrastructure Coalition, an organization founded to support the growth of the $46 billion Internet infrastructure industry. As the CEO of Codero, I look forward to joining with other Texas-based tech companies to welcome the industry to Austin.
Our capital is a great place for a national event like HostingCon. I have been part of this wonderful city since 1986. I have seen it grow and evolve into a true center of gravity for information technology. Internet infrastructure leaders and proud members of the i2Coalition such as SoftLayer, cPanel, Data Foundry Inc., Rackspace and Codero have established their headquarters and main offices in Texas, helping the Lone Star State obtain Cyberstates’ second ranking nationally for industry jobs in Internet, telecommunication and engineering services as well as semiconductor manufacturing.
At the same time, Texas universities are producing tech-savvy graduates and advancements in the technological sector.
As Texas grows and matures in the high tech industry, it’s imperative that it protects the ideas, innovation and new technology that are being developed by businesses.
At HostingCon, the i2Coalition is sponsoring a number of panels that examine some of the greatest threats to our industry, including a panel called “Money Stealing Trolls.” Of particular concern when it comes to threats to innovation are attacks by patent assertion entities, or “patent trolls,” who seek to undermine technological progress for quick financial gain. These trolls have taken advantage of a broken patent system, allowing them to bring up patent infringement cases on small and large businesses. These lawsuits can cost a company millions of dollars in litigation alone. For this reason, many of the larger companies settle out of court. However, smaller companies like Codero attempting to grow in our economy also face these frivolous lawsuits. Patent trolls can cause small- to medium-sized companies to lose revenue, forcing them to cut salaries and jobs — and in extreme cases file for bankruptcy. The tactics of the trolls are stifling innovation. Because of their actions many companies hesitate to produce new products for fear of violating an unknown frivolous patent.
One of the i2Coalition’s top priorities is to bring about patent reform, and both the i2Coalition and Codero applaud Texas Sen. John Cornyn for introducing a bill known as the Patent Abuse Reduction Act of 2013.
This will bring fairness to the discovery process, Cornyn says. The bill will also shift responsibility for the cost of litigation to the losing party. This will relieve small business from hefty litigation cost and punish patent trolls. The act also calls for transparency in enforcement, meaning all parties that have direct financial interest in the outcome of the lawsuit must be revealed.
Sen. Cornyn is attempting to put an end to the chaos and economic stagnation these money stealing trolls create. We must stand up and support his efforts and the efforts of Texans as a whole to grow and develop in the technological world.
Emil Sayegh is the CEO of Codero Hosting.
Read the article in the Austin Business Journal here.