While Seattle Seahawk Russell Wilson continues to wipe away tears of joy (and Cheeseheads, tears of despair), we bring you news of patent troll legislation out of the Evergreen State.
What’s a patent troll? A company that acquires “exceptionally broad patents” and then accuses another company of violating patent laws for the purpose of financial gain. According to the office of Washington State Attorney General Bob Ferguson:
“Patent trolls know their claims would not prevail in litigation and have no intention of going to court. Their scheme relies on small, uninformed businesses that are willing to pay licensing fees to avoid the threatened lawsuit.”
Per The Seattle Times, patent troll examples include companies overwhelming homebuilders with letters claiming patent infringement for using fans and dehumidifiers or threatening radio stations with lawsuits for how they store music and process it.
The attorney general’s office offers a more detailed example:
“One well-known patent troll alleges to have a broad patent on scan-to-print technology. Rather than targeting Xerox or Canon — companies with patent attorneys on payroll — this troll sends hundreds of letters to small businesses across the country. While the troll has never tested its claims in court, this troll demands a license fee of $1,000 per employee and threatens a lawsuit if the target refuses to pay.”
The intention of the Patent Troll Prevention Act is to protect the rights of legitimate patent holders and crack down on deceptive and predatory claims of patent infringement.
“That bill, and companion legislation in the House, would set guidelines for the attorney general and courts to determine which business people are legitimately aiming to protect real patents versus those acting in ‘bad faith.’ The bills would allow the attorney general to sue offenders under the Consumer Protection Act.”
State Sen. David Frockt, who is sponsoring the bill in the Senate, stated:
“Washington entrepreneurs should be protected from these fraudulent attempts to extort alleged licensing fees. This measure is vitally important to our technology and life sciences sectors, as well as other enterprises, who rely on the fair and legitimate operation of our intellectual property system.”
Interestingly, according to the newspaper, similar legislation passed in 17 other states but a federal patent-reform bill died in the Senate. According to U.S. Sen. Patrick Leahy, there was opposition from “universities, trial lawyers and the bio-pharmaceutical industry.”
What do you think about the proposed state legislation or its merits at the federal level.