Technology’s takeover of the shopping experience has brought many benefits to both retailers and customers — along with one very big drawback. It has drawn the attention of so-called “patent trolls,” more formally known as patent assertion entities (PAEs) or non-practicing entities (NPEs). These are companies that hold broad, often vaguely worded technology patents, with a business model that consists of suing other companies that make any sort of use of the patented technology.
“NPEs began targeting retail companies as an industry group in the mid-2000s and the trend quickly escalated,” said Diane Lettelleir, senior managing counsel at JCPenney in an interview with Retail TouchPoints. “The increased use of technology in retail operations likely drew the attention of NPEs initially, but the fact that retail companies had little experience with patent litigation made them particularly vulnerable.”