Congress takes aim at 'patent trolls'

Congress is poised to take up legislation to combat frivolous patent infringement lawsuits.

Members of both parties are clamoring to take on the issue, and there are at least five separate proposals to address the problem.

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Numerous companies have complained in recent years about being threatened with lawsuits by firms that have no plans to create any products. The "patent trolls" buy up cheap patents, find companies using similar technologies and then threaten to bring them to court for infringement unless they agree to an expensive settlement.

The firms target companies creating products, but they also go after small businesses using common technologies such as an office scanner or a Wi-Fi network.

Many businesses agree to settle because the cost of fighting the charges in court would be so high. One study found that businesses paid out $29 billion to patent trolls in 2011.

Patent law is a complicated and controversial policy area, with numerous competing interest groups. It took Congress nearly a decade to complete the most recent broad patent update with the America Invents Act, which became law in 2011.

But cracking down on patent trolls is one area where lawmakers may be able to agree on legislation this Congress.

"I think this is actually very doable," said Marla Grossman, a lobbyist with the American Continental Group who supports addressing patent abuse.

The biggest obstacle to patent troll legislation may come from trial lawyers and some Democrats who are suspicious of efforts to limit access to the courts.

At a hearing in March, Rep. Mel Watt (D-N.C.) worried that without a proper definition, lawmakers will "impact adversely a bunch of people we should not be impacting." Rep. Hank Johnson (D-Ga.) warned that legislation targeting patent trolls could open the door to deny plaintiffs "their right to go to court in other tort situations."

Rep. John Conyers (D-Mich.), the Judiciary Committee's ranking member, said he suspects the tools to address patent trolls already exist.

"The real question is how do you do it in a way that doesn't cut off access to courts,"  Jessica Herrera-Flanigan, a lobbyist representing tech companies and retailers for the Monument Policy Group, said.

The bill most likely to begin moving in Congress is a draft proposal from House Judiciary Committee Chairman Bob GoodlatteRobert (Bob) William GoodlatteFight breaks out between Jordan, Nadler over rules about showing video at Garland hearing The job of shielding journalists is not finished Bottom line MORE (R-Va.) and Senate Judiciary Committee Chairman Patrick LeahyPatrick Joseph LeahyThese Senate seats are up for election in 2022 Senate panel advances bill blocking tech giants from favoring own products Former US attorney considering Senate run in Vermont as Republican MORE (D-Vt.).

Their bill would limit the kinds of documents that firms could force their opponents to produce during the discovery phase of a trial, a major cost in patent litigation. The measure would allow the manufacturer of a product to intervene to block cases against its customers over alleged patent infringement and would make a series of changes to the Patent and Trademark Office aimed at helping small businesses participate in the office's decisions.

In a statement, Goodlatte said that patent trolls "have a significant impact on American competitiveness, costing our economy billions of dollars each year."

"It is my hope that this discussion draft is the first step in enacting meaningful legislation that reduces the costs of frivolous litigation, increases patent certainty and promotes the creation of American jobs,” he said.

Leahy vowed to work with both parties and chambers on the issue and said the discussion draft is an "important starting point."

But the proposal received a cold reception from the House Democrats.

"We must first determine whether there is an abusive litigation problem by patent assertion entities that warrants a legislative response," Conyers and Watt said in a joint statement.

Grossman said the Goodlatte-Leahy proposal is stronger than some of the other bills because it targets harmful behavior instead of trying to define patent trolls.

"Earlier discussions focused on trying to define what an undesirable entity was. I think that those efforts will ultimately fail," she said.

"Very thoughtful associations, think tanks and institutions have been studying that issue for years and have failed to come up with a consensus of a definition of a patent troll," she explained.

Sens. Chuck SchumerChuck SchumerVoting rights failed in the Senate — where do we go from here? Forced deadline spurs drastic tactic in Congress Democrats call on Biden administration to ease entry to US for at-risk Afghans MORE (D-N.Y.) and John CornynJohn CornynSenate panel advances bill blocking tech giants from favoring own products Senators introduce bill aimed at protecting Ukrainian civilians Lawmakers press Biden admin to send more military aid to Ukraine MORE (R-Texas) and Reps. Peter DeFazio (D-Ore.), Jason ChaffetzJason ChaffetzNunes retirement move seen as sign of power shift in GOP Congress's latest hacking investigation should model its most recent Fox News Audio expands stable of podcasts by adding five new shows MORE (R-Utah) and Ted Deutch (D-Fla.) have all introduced bills to combat patent trolls.

Although Goodlatte and Leahy will likely move their own bill, elements of the other proposals could be added as amendments.