They're certainly a middleman in the patent system. The question is whether they're a middleman for positive exchanges (good) or a middleman for extortionate ex

They're certainly a middleman in the patent system. The question is whether they're a middleman for positive exchanges (good) or a middleman for extortionate exchanges (bad). Most people seem to be assuming the latter; you seem to be assuming the former. To clarify, the two business plans I'm thinking of are A) Find overlooked innovations; buy the patents; sell or license the patents to firms interested in developing products based on the innovations. B) Find overlooked overly broad patents; buy the patents; find companies who rely on systems which likely infringe these patents; threaten to sue these companies unless they pay large licensing fees. I would say that the evidence is on the side of model B. First of all, middlemen for extortion abound - the so called "patent trolls" - it is a proven market. Have you heard of any middlemen for genuine innovation? Secondly, we can look at the company's client list. Cisco, Verizon, Sony, Nokia, Microsoft, Intel, Google, eBay, SAP, and Nvidia are named in the linked article. Lots of software and electronics companies. The nature of software companies probably makes business plan (A) impossible (the conventional wisdom, at least, is that no one cares about a bright idea in software; they care about implementation). If they were following business plan (A), I'd expect to see industries where ideas are worth a great deal of money more represented - biotechnology maybe. I don't know if patents are worth anything, except for litigation purposes, in any industry really though. Finally, the actual article spells things out, although we can't be sure how accurate it is. "It works like this: Technology companies agree to pay patent-licensing fees to inoculate themselves against potential lawsuits by Intellectual Ventures." This kind of business plan is strictly destructive to the economy. Under this business plan, the patent gives nothing of value to the company licensing it (they are already infringing the patent, having "discovered" it in the normal course of business). It is the prevalence of these sorts of deals, and the rarity of the sort typified by model (A), that have put many of us against the patent system. By the way, a strong economy is no evidence that the patent system is pretty good. The economy could be strong even if we had an absolutely miserable, almost purely destructive patent system. The patent system may have simply too small an effect to make the difference singlehandedly between a strong economy and a weak one. Or maybe it has a large effect, and our economy would be far stronger with a non-broken patent system. It's impossible to know, when all we have is this tangled-up complex system called the economy which somehow works pretty well.