CUNA assesses House, Senate patent assertion legislation

April 30, 2015
WASHINGTON (5/1/15)--CUNA remains concerned about a very narrow definition of "bad faith" for patent assertion letters that would trigger enforcement actions under the Targeting Rogue and Opaque Letters (TROL) Act. The House Energy and Commerce Committee approved the bill 30-22 this week.
On the same topic, CUNA is studying a comprehensive and bipartisan Senate patent reform bill introduced Wednesday. The Protecting American Talent and Entrepreneurship Act (PATENT Act)  was introduced by Senate Judiciary Chair Chuck Grassley (R-Iowa), the panel's ranking member, Sen. Patrick Leahy (D-Vt.), as well as Sens. John Cornyn (R-Texas) and Charles Schumer (D-N.Y.), who are senior members of that committee.
In one of its 16 sections, the bill calls for civil penalties to be levied by the Federal Trade Commission (FTC) in connection with patent assertion entities engaged in widespread demand letters abuse, with civil penalties for FTC rule violations specified.
The provision does not impinge on legitimate licensing activity or expand the authority of the FTC.
The House's TROL Act would require patent demand letters to contain more details about a patent, who owns it and what is being infringed upon than is required under current law. The act would also empower the FTC and state attorneys general to enforce those requirements and bring action against those who send "bad faith" demand letters.
CUNA maintains that a better approach to enforcement would focus on the effect of a patent demand letter on end users, rather than on the knowledge of the violator. CUNA also has expressed concerns that the TROL Act would undo the constructive state bills that have passed and replace them with a "weaker federal standard."
CUNA will continue 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.