Senator introduces legislation targeting patent trolls
The bill would extend a patent-challenging provision of a 2011 law
IDG News Service - U.S. Sen. Charles Schumer (D-N.Y.) introduced legislation allowing the U.S. Patent and Trademark Office to review and invalidate controversial patents challenged by technology startups in an effort to discourage so-called patent trolls.
Schumer introduced a bill Wednesday that would extend a patent-challenging provision in the 2011 patent reform bill, the America Invents Act. The patent bill included a temporary program that allowed companies in the financial products industry to challenge business-method patents at the USPTO. Schumer's new bill would expand the provision to include business-method patents challenged by technology start-up companies and would remove the provision's temporary status.
Schumer's legislation is targeted at so-called patent trolls, patent-holding companies with business plans focused on suing for patent infringement and not on making or selling products.
"Patent trolls are bullying New York's technology companies, stymieing innovation and dragging down growth," Schumer said in a statement. "This legislation will provide small technology startups with the opportunity to efficiently address these claims outside of the legal system, saving billions of dollars in litigation fees."
The provision in the America Invents Act, authored by Schumer and former Senator Jon Kyl, an Arizona Republican, has led to about 20 patents being challenged at the USPTO.
Schumer noted that patent trolls cost U.S. software and hardware companies $29 billion in 2011, according to a study from the Boston University School of Law.
Under current law, a company defending against a patent suit has two options: pay to defend the suit or settle and pay a licensing fee, Schumer noted. The average settlement with a patent troll costs a small or medium company $1.33 million, while an in-court defense would cost the same company an average of $1.75 million per case, he said.A
Some tech trade groups praised the new bill.
The bill is a "step toward curbing patent troll abuse," Jon Potter, president of the Application Developers Alliance, said in a statement. "Patent trolls hamper innovation and pose a looming threat to all entrepreneurs and innovators. They prey on startups and independent app developers who do not have the time or resources to undergo an expensive legal battle."
Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's e-mail address is firstname.lastname@example.org.
- The Business Value of Continuous Delivery Download this whitepaper to learn more about the business value of Continuous Delivery and see why it could be a game changer for...
- Ten Factors Shaping the Future of Application Delivery Download this research report conducted by Enterprise Management Associates (EMA) to learn how those that are seeking to accelerate application delivery are leveraging...
- Software Asset Management: Ensuring Today's Assets Today's trends like BYOD and SaaS are new and exciting in terms of how they will help make our jobs more productive but...
- Trends Shaping Software Management: 2014 Most IT executives recognize the relationship between mobile computing and worker productivity, and have long issued notebook computers and other mobile devices to...
- On-demand webinar - 7 Keys to Service Catalog Implementation Success Watch this webinar to learn 7 crucial keys to make your service catalog a success!
- Transform Your IT Service Management Watch this webinar, to learn how EasyVista can increase IT productivity & efficiency and deliver streamlined & integrated IT Service & Asset Mgmt. All Gov't Legislation/Regulation White Papers | Webcasts