Trolls can be just as bad in the court system as they are under bridges.
Several members of the U.S. Senate Judiciary Committee, including Chairman Chuck Grassley, R- IA and Ranking Member Patrick Leahy, D- VT, have proposed legislation that seeks to update and improve the patent system in the U.S. The main goal of the bill is to end the abuse of the patent system by so-called “Patent Trolls.”
“Patent trolls are taking a system meant to drive innovation and instead using it to stifle job-creating businesses around the country,” Sen. Chuck Schumer, D- NY said.
A patent troll can be broadly defined as a person who brings forward a large number of frivolous and unreasonable patent violation lawsuits.
“The current cost of resolving questions of infringement and validity in our litigation system is relatively high, and, in that system, a patent owner that unreasonably asserts infringement is expensive to defeat,” said David Todd, adjunct professor of law at BYU.
Patent trolls often receive settlements simply to avoid the heavy costs of litigation, and businesses are hurt by this unnecessary expense. In or out of the court room, patent trolls are costly to deal with.
“Abusive patent litigation is a threat to our economy and costs consumers and businesses billions of dollars each year,” Grassley said.
Developing the bill has taken several years and involved a number of senators from both parties. The involved senators sought to design the bill to protect business owners and the court system from baseless lawsuits in a way that would still protect the goals of the patent system.
“Our balanced approach to reform will deliver needed help to small businesses beleaguered by abusive demand letters and extortionate litigation and will ensure a commonsense and efficient approach to litigating complex cases, without endangering the patent system,” Sen. Mike Lee, R-UT, said.
This bill first seeks to give consistency to the standards of bringing forth claims by patent owners while also protecting businesses that simply purchased a product from a manufacturer. It will instead shift the lawsuit exclusively to the manufacturer. More time-consuming portions of the legal process will be required by the bill to be postponed until early decisions in the case, such as dismissing the matter altogether, have been resolved.
The bill makes it costly for those who are abusing the system by awarding attorney fees to the winner if the losing party is determined to not have a reasonable claim. Letters written by patent owners to those accused of violation would be required to be more informative and in no way misleading. The bill will increase transparency by requiring more information to be available about the ownership of patents.
Despite the confidence displayed by the involved senators, there are still concerns about the efficacy of this legislation in carrying out the purpose of a patent. Patents are meant to provide incentive for inventors to invest in development of new ideas and bring those ideas to the public, but not if the patent doesn’t hold up in court.
“One of the concerns expressed about this kind of legislation is that it could make it more difficult for the bona fide innovator to enforce valid and infringed patents,” Todd said. “If that becomes more difficult, then the purposes for patents will be more difficult to achieve.”
It is up to Congress to decide if the benefits of controlling the trolls are worth the risk to holders of legitimate patents.