Patents seem like a good idea on paper. If you come up with something innovative, you should reap the rewards. That safeguards the hard work and money someone puts into an invention or technology.

But patents really amount to a legal monopoly, granted by government. And as is typical with government, this intervention into the economy creates some interesting side effects.

Patent trolls are businesses which own patents for the sole purpose of litigation. They don’t make their money from producing whatever the patent secures. They make their money suing companies for patent infringement.

This works best when the patent is something that probably should have never been patented in the first place.

For instance, a company called Personal Audio managed to successfully sue Apple in 2011 for $8 million. The patent they say Apple infringed on: downloadable playlists.