We previously wrote about the nascent efforts of legislators, regulators, and representatives of technology-dependent industries to use the antitrust laws, such as Section 2 of the Sherman Act or Section 7 of the Clayton Act, to rein in perceived abuses by patent aggregation entities ("PAEs"), more commonly known as patent trolls. One potential difficulty in bringing PAEs' actions under the antitrust laws is that their activities do not fit neatly into any traditional definition of a relevant product market. The United States District Court of Maryland, however, recently permitted antitrust counterclaims against a PAE to proceed to discovery, even though the United States District Court for the Eastern District of Virginia previously dismissed similar counterclaims involving the same parties based on a failure to allege a proper relevant product market.1
In Intellectual Ventures I LLC v. Capital One Financial Corp., Intellectual Ventures I brought a patent infringement suit in the United States District Court of Maryland alleging that Capital One infringed four patents in its portfolio. Capital One asserted a counterclaim and third-party complaint (against shell companies owned and controlled by Intellectual Ventures I), alleging Intellectual Ventures I violated Sherman Act Section 2 and Clayton Act Section 7. Capital One alleged that Intellectual Ventures I owns 3,500 patents purportedly relating to online financial services, but holds those patents through an opaque network of 2,000 shell corporations. Intellectual Ventures I hides those patents to prevent businesses from designing around those patents or, once Intellectual Ventures I brings an infringement action, determining the value of any license to a single patent or group of patents. Further, Capital One alleged that...
