The Cryptocurrency Open Patent Alliance (COPA) has partnered with Unified Patents to tackle the growing issue of “patent trolls” in the blockchain and crypto industry. These so-called trolls, or non-practicing entities (NPEs), hold patents without using them and instead profit by suing or negotiating settlements with firms accused of infringing on their intellectual property.
COPA and Unified Patents Unite Against NPEs
In a blog post on October 1, COPA announced the launch of the “Blockchain Zone,” a collaborative effort with Unified Patents aimed at defending blockchain companies from unnecessary and expensive legal battles brought by patent trolls. The campaign will focus on patents held by NPEs that cover various blockchain technologies, including non-fungible tokens (NFTs), wallets, and smart contracts.
These NPEs often take advantage of high legal fees to force settlements, stalling innovation within the crypto industry. COPA’s new initiative seeks to eliminate these legal barriers, protecting developers and firms from frivolous lawsuits.
Patent Trolls: A Roadblock to Innovation
Patent trolls present a significant hurdle to technological progress, especially in the rapidly evolving crypto space. According to Unified Patents, NPEs were behind 58% of all patent litigation in the U.S. last year, with 95% of their targets being technology companies. Paul Grewal, Coinbase’s legal chief, emphasized that these trolls “must be stopped” to allow innovation within the crypto economy to flourish.
Kevin Jakel, CEO of Unified Patents, echoed these concerns, asserting that this partnership would prevent the crypto sector from facing the same challenges with patent trolls that have plagued other industries.
Recent Patent Disputes in Crypto
The crypto industry is no stranger to patent disputes. In September, the DeFi Education Fund (DEF) moved to cancel a patent related to connecting off-chain data to blockchains, owned by True Return Systems. The patent holder had previously sued blockchain protocols MakerDAO and Compound Finance for infringement. DEF eventually purchased the patent in a settlement deal, putting an end to the legal claims.
In another case, Ethereum Name Service (ENS) is currently challenging a patent granted to its rival, Unstoppable Domains. ENS claims it was the first to create blockchain-based technology for determining domain names, refuting Unstoppable Domains’ assertion that it pioneered the technology.
