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News Now

Washington
Bill to fight patent 'trolls' passes House subcommittee
WASHINGTON (7/14/14)--The House subcommittee on commerce, manufacturing and trade voted 13-6 Thursday to advance a bill designed to combat abusive patent demand letters. The Targeting Rogue and Opaque Letters (TROL) Act of 2014 would crack down on unfair or deceptive practices in connection with the assertion of a U.S. patent.

The bill would prevent the following:
  • The sending of communications where the sender falsely represents that they have the right to enforce the patent, a civil action has been filed against the recipient for a violation, a civil action has been filed against other recipients, legal action will be taken, the sender is the exclusive licensee of the patent or an investigation into infringement of the patent has occurred;

  • A sender seeking compensation for an unenforceable patent claim, activities undertaken by the recipient after the patent has expired or authorized activity regarding the patent by the recipient; and

  • The sender failing to provide the identity of the person asserting the right to the patent, the patent that is alleged to have been infringed upon, an identification of the alleged patent infringement or contact information for a person making the infringement claims.
Violations of the bill would be enforced by the Federal Trade Commission (FTC), under its powers to enforce rules against unfair or deceptive acts or practices.

The Credit Union National Association has been a longtime advocate of meaningful patent reform and submitted a joint letter with other trade associations representing more than 14,000 financial institutions Thursday in support of some of the provisions the TROL Act.

"Financial institutions of every size have been targeted by Patent Assertion Entities, often referred to as patent trolls, who in most cases assert patents of dubious quality through vaguely worded demand letters or intentionally vague complaints," the letter reads. "Indeed, patent trolls' recent focus on credit unions and community banks threatens to pose additional, unwarranted costs on lenders and the communities they serve."

The letter also praised the bill for clarifying the FTC's authority to fight these deceptive practices while not infringing upon the rights of legitimate patent holders to assert their rights.

The bill will now be sent to the full House Energy and Commerce Committee.


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