WASHINGTON (2/26/15)--CUNA continues to press for patent law reforms that would ban abusive patent demand letters and lawsuits that can harm the financial services industry, as well as the consumers it serves.
In a statement with other trades, submitted for the record of today's House Energy and Commerce Committee hearing on Patent Demand Letter Practices and Solutions, CUNA laid out principles that should be applied to any forthcoming patent reform legislation.
"We fully support (the committee's) goal of developing legislation to tackle the scourge of bad faith patent demand letters. Financial institutions of every size have been targeted by Patent Assertion Entities (PAEs), often referred to as patent trolls, who in most cases assert patents of dubious quality through vaguely worded demand letters or intentionally vague complaints."
The letter adds that hundreds of credit unions and banks have been targeted by such entities, "using tactics resembling fraud or extortion."
Chief among any legislative solution should be provisions clarifying the Federal Trade Commission's authority to fight against deceptive practices, while not affecting legitimate patent holders' rights to assert their patent rights.
"In addition, we note that states have proven to be effective laboratories for developing and furthering robust policy relating to patent trolls. While most states could see a reduction in unsubstantiated bad faith demand letters if this legislation were to be enacted, the bill should also allow states that have proactively enacted laws to discourage bad faith demand letters to continue to enforce them," the letter reads. "If state law is preempted, it is imperative that strong and enforceable national standards for demand letter transparency be put in place."
The principles that should be included in any patent reform legislation fall into three categories:
The hearing is scheduled to being at 10:15 a.m. (ET) and will be streamed online.