GOP lawmaker plans tougher ‘patent troll’ bill

Greg Nash

A House Republican has a new bill aimed at tackling patent “trolls” and the letters they use to force companies into legal settlements.

The draft legislation from Rep. Lee Terry (R-Neb.), who heads the House Commerce subcommittee on manufacturing and trade, would add requirements for the notice letters from trolls, which make money by filing lawsuits claiming someone has infringed on their patent rights.

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“Patent trolls cost American companies tens of billions of dollars each year, and are threatening job creation and innovation,” Terry said in a statement.

His discussion draft, he said, “is a first step in trying to find a sensible solution” ahead of a hearing next week toward “a balanced bill.”

Terry’s subcommittee is planning to make edits to the bill on Thursday.

Major companies and lawmakers on both sides of the aisle claim that patent trolls send a slew of meaningless letters to firms far and wide accusing them of violating their licenses. The letters are often vague and might not mention which specific patent is being violated or how, which forces companies to pay a quick settlement to avoid a legal fight.

Terry’s new bill would require that the letters include some basic information about what patent is being infringed and would also empower the Federal Trade Commission and state attorneys general to take action against companies that abuse the letters.

The House late last year passed the Innovation Act, a broader bill to take on the patent trolls that included some measures to limit the letters.

Progress on that bill has stalled for weeks in the Senate, however, where members of the Judiciary Committee have been unable to hammer out their differences. The panel is planning to meet on the issue next week, though analysts have said that time is quickly running out to move forward with a bill that can get to President Obama’s desk this year.