Bad News for Patent Trolls, US House Passes New Bill to Rein in Fights
Patent trolls have been the bane of the patent industry for some time now. Now, a new bill passed by the US House of Representatives hopes to put an end to unnecessary patent fights. The bill will help in ‘reining in’ companies that seek licensing fees for patents that are now invalid, or write dishonest demand letters to the USPTO for unnecessary grievances. The bill which is called the TROL for short is undoubtedly targeted towards the blatant misuse of patent laws by trolls and derives its moniker from the term ‘troll’.
TROL Act to stop trolls
TROL – Targeting Rogue and Opaque Letters Act – is now up for consideration by a full committee. For now, the Energy and Commerce Committee subcommittee on Commerce, Manufacturing and Trade has passed the bill by a 13-6 vote and the draft has been approved. Whether the bill becomes a law is now up to the committee to decide which will meet to take a mandate on the issue soon.
The TROL Act allows the Federal Trade Commission – FTC – to pursue companies that it believes have indulged in dishonest license demands for patents; but only if the FTC can prove bad faith and the intent to dupe. The bill does give more power to the FTC but also makes it harder for the agency as it now will have to prove the dishonesty of a company before implicating them in any legal procedure. Another point of critique against the new bill that if it is passed into federal law then it would be a diluted version of the strict patent laws that some states already have in place and would undo the good work that has been done in those states till now.
The bill has a definite purpose of attacking those companies that do not make products or offer services based on a patent, but write letters demanding licensing fees by declaring that some other company has been infringing on the said patent. In patent lawyer parlance, these companies are called ‘Patent Trolls’. Most of the time they are paid the licensing fees due to the coercion tactics that they employ, but if their invalidated claims were brought to court, it would never stand up to the scrutiny of an experienced patent lawyer. However, since these patent cases can be long drawn out and can create bad blood in the market most people just opt for an out of court settlement.
Companies Look for Ways to Mitigate Problem
Several attempts have been made in the Congress to pass laws that would make it harder for patent trolls to function in the country, but sadly none of them have passed. Whether the TROL act can bring respite to an industry that is weary of fighting trolls at every point is debatable and this is why companies have decided to take the fight to their enemy.
Recently, Ubisoft won a case against a troll company on a DRM patent issue by refusing to back down and have its patent lawyers settle out of court unlike its peers. Now, big companies, such as Google and Microsoft, are teaming up to think of creative methods to stop trolling. The License of Transfer Network (LOT) founded by big industry names like Asana, Canon, Drop box, Google, Newegg, and SAP will fight patent trolls and patent privateers and aim to cut down on patent litigation.
Solid Effort Republicans
With patent lawyers in the country fighting more than 6,000 lawsuits filed in 2013, the LOT network has its job well etched out. The founding members hope that by collectively fighting against this malice they can find ways to curb the nuisance without giving up on innovation and the creation of cutting edge products.