Connecticut Attorney General George Jepsen has joined with 41 other state and territorial attorneys general in expressing support for patent reform legislation now pending in the U.S. Senate. Already approved by the House, the measure is largely aimed at entities referred to by intellectual property lawyers as “patent trolls.”
In a letter to the leaders of the Senate Judiciary Committee and Commerce Committee, Jepsen and the others express their support for the proposed federal legislation, while at the same time advocating for language that would also allow states to fight patent trolls using their own consumer protection laws.
Jepsen said patent trolls are a growing consumer problem in Connecticut and across the United States. Patent trolls acquire patents solely for the purpose of using them to leverage payments or other financial benefits from parties that allegedly infringe on a patent. Through the issuance of demand letters to their targets – often consumers, nonprofits and small businesses – patent trolls demand license fees or settlements under threat of litigation unless the target complies with their demands for payment, the attorney general said.
“Patent trolls don’t acquire patents for the purpose of developing a technology or product,” said Jepsen. “They buy patents with the sole objective of using them to make money from claims of patent infringement. Many of these claims are dubious, at best. In Connecticut, we’ve seen complaints from small business owners and nonprofit directors, and community banks that may have done nothing wrong and yet find themselves facing high pressure tactics and potentially expensive patent litigation if they don’t pay up.”
The bill now before Congress promotes further transparency in patent ownership and works to make reforms in patent litigation. “Congress and the federal government have shown an interest and made progress in addressing the gross misuse of the current patent system,” said Jepsen. “The Senate’s proposal is a positive step that should assist in the efforts on both the state and federal levels to combat this problem.”
The attorneys general are encouraging Congress to consider adding several amendments to their bill. In addition to recquests for state enforcement authority, the AGs urge disclosure requirements for patentees that send demand letters as well as confirmation that state courts will have personal jurisdiction over entities that direct unfair or deceptive patent demand letters into states.