Adweek - Long-Awaited Bill to Curb Patent Trolls Abuses Introduced

January 29, 2014
In The News

With strong bipartisan support, prospects for passage look good

By Katy Bachman

The much-anticipated bill to curb patent troll abuses is officially moving and moving fast—even after being sidelined by the government shutdown. Rep. Bob Goodlatte (R-Va.), chairman of the judiciary committee, introduced his bill this morning before a packed hearing room, flanked by lawmakers from both sides of the aisle. 

Called the Innovation Act, the 51-page bill is based on two former drafts, but doesn’t depart far from the most recent draft circulated in September. During the press conference, Goodlatte said he plans to "move the bill through the process quickly," scheduling a hearing for next Tuesday. 

Key features of the bill should make it easier for the growing number of companies victimized by patent trolls to defend themselves. The bill requires patent trolls to provide more detail about the claim and be more transparent about the ownership and financial interest behind the patent. It requires patent assertion entitles to sue the holder of the technology—not the end user—and shifts legal fees if the patent assertion entity loses its case.

Patent trolls have been blamed for costing the U.S. economy $80 billion and companies that have had to defend themselves $29 billion, according to an oft-cited Boston University study.

“The problem of patent trolls has grown exponentially. In addition to the tech community, now we find that all of their customers, virtually all of American business and industry, were getting demand letters from [patent trolls] leveraging claims against the cost of litigation,” said Goodlatte.

Goodlatte stressed that the bill was not punishing patent holders, but is aimed at abusive practices that have cost companies billions.

“The bill doesn’t devalue patent rights. It pushes for legal reform measures and strengthens the patent system,” said Goodlatte, adding that the term "patent troll" refers to a behavior.

The 4A's, which lobbied hard for the bill, cheered the development. “Over a year ago, we were a lone voice in the wilderness. A year later, we have the judiciary chairman dropping this landmark legislation. Trolls have created damage for our agency members,” said Dick O’Brien, evp of the 4A's. “This bill will make it harder for the trolls to use the tricks they’ve used to extort money from companies that can’t afford it,” he added.

With Sen. Patrick Leahy (D-Vt.) working on a Senate version, strong bipartisan support in both chambers, and President Obama’s executive actions announced in June, the prospects for something to actually get done in gridlocked Washington, are good.

"This is an issue on which chairman Goodlatte and I share a common goal," said Leahy in a statement commending Goodlatte on his bill. Leahy also said hs is continuing to work to develop legislation in the Senate, working with Sen. Mike Lee (R-Utah) and others. 

Rep. Anna Eshoo (D-Calif.), one of the three Dems co-sponsoring Goodlatte's bill, predicted it will “go all the way to the Rose Garden.”