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National Restaurant Association - Va. Rep. introduces bill to curb patent trolls

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Va. Rep. introduces bill to curb patent trolls

Rep. Bob Goodlatte (R-Va.) on Wednesday  introduced a bill to address the growing problem of abusive litigation by patent assertion entities (PAEs).

Patent-assertion entities, also known as patent trolls, seek to profit by claiming to own the rights to common business practices or tools and threatening businesses that use them with litigation. Demand letters sent by patent trolls regularly cite the anticipated cost of defending the lawsuit in an effort to encourage the business to settle rather than fight the case in court.

The bipartisan legislation (H.R. 3309) aims to require those who attempt to sue for patent infringement to identify the patents and be more specific as to how they were infringed.  The bill also requires plaintiffs to disclose interested parties and financial interest, has fee shifting provisions, and contains other measures to assist patent troll victims.

Restaurants have been among those targeted recently by patent trolls for their use of wi-fi and other commonly used technology like online ordering tools and nutrition calculators.

“The continued onslaught of frivolous claims made by ‘patent trolls’ on main street businesses like the restaurant industry is inhibiting economic growth by draining more than $80 billion out of our economy each year that could go toward job creation,” Scott DeFife, National Restaurant Association senior vice president, policy and government affairs, said in a statement. “Increased transparency, demand letter disclosure and patent litigation reform will help provide significant relief for the restaurant and foodservice industry. We appreciate Chairman Goodlatte’s leadership on this issue, and we thank him for working with us to grow the bipartisan and bicameral support for addressing the patent troll problem in Congress.”

Association staff is working with legislators to include elements that address demand-letter reform, and to make further changes to protect end-users who are targeted by trolls.

Goodlatte’s announcement is the latest step in increased federal scrutiny of patent trolls. In June, President Obama announced a series of executive actions to address the growing problem of patent trolls. Among them were steps to allow those facing litigation to learn the extent of a PAE’s claim to patent ownership, prevent overly broad claims to ownership, and expand efforts to inform restaurant owners and other potential targets of common tactics being used by patent trolls.

Business trade groups have also begun to fight back against patent trolls. The NRA, along with The Internet Association, National Retail Federation, and the Food Marketing Institute in August launched a print and radio advertising campaign in targeted states and across the country, asking Congress to help stop patent abuse and protect American businesses from patent trolls.

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