ABA, Financial Groups Caution on Patent Troll Bill

​Patent troll legislation currently before the House Energy and Commerce Committee does too little to protect banks and other businesses from abusive patent infringement claims, ABA and several other trade groups said yesterday. Moreover, the bill would replace several states’ stronger standards with a nationwide weak approach to combating patent trolls.

The legislation the committee is considering would require recipients of abusive demand letters — which assert vague or unclear patents on widely used processes or technologies in order to extract “licensing” fees from businesses — to show that the patent troll sent the letter in “bad faith.” “This is a very difficult standard to meet and would make the transparency requirements virtually unenforceable,” the groups said.

Meanwhile, they wrote, the bill would preempt and nullify more “constructive” state laws, but “[i]t does not make sense to do this and then put in place a weaker and ineffective federal standard,” the groups added. ​