MN AG Urges Congress To Take Aim At “Patent Trolls”

MN AG Urges Congress To Take Aim At “Patent Trolls”

Attorneys general from 42 states, including Minnesota, are advocating for patent reforms that they say would protect businesses from the threat of unnecessary litigation.

Minnesota’s Lori Swanson was one of 42 attorneys general who signed a letter this week in support of legislation that targets so-called “patent trolls.”

The letter was addressed to Patrick Leahy and Chuck Grassley of the U.S. Senate judiciary committee, as well as John D. Rockefeller, IV, and John Thune of the Senate committee on commerce, science, and transportation.

The attorneys general jointly expressed support for bipartisan legislation aimed protecting businesses from companies that don’t actually make products but attempt to enforce patent rights and collect licensing fees. Such companies often call themselves “non-practicing entities,” although their critics have applied the less flattering name of “patent trolls.”

“So-called patent trolls stifle innovation and harm our economy by making dubious claims of patent infringement and using the threat of expensive litigation to extort money from small businesses and nonprofits,” the letter states. “We have received many complaints from these businesses and nonprofits, our constituents, who are desperate for relief from the misuse of the patent system. While these threats were once focused on tech businesses, they are now levied at all manner of businesses, including banks, hospitals, restaurants, and hotels.”

The attorneys general said their offices have responded to such complaints by investigating and bringing enforcement actions against patent trolls in their respective states.

In Minnesota, Swanson has touted her office’s early actions against such companies. In August, her office announced that it reached a settlement with Delaware-based MPHJ Technology Investments, LLC, which allegedly targeted thousands of businesses for using basic office equipment to scan documents to e mail, pressing them to pay a fee of $1,000 to $1,200 per employee for a license in order to avoid litigation. Swanson’s office said that the patent troll agreed to cease its activity in Minnesota, marking the first such settlement between an attorney general and a patent troll.

The recent letter that Swanson signed expresses support for patent reform legislation that passed the House and is now pending in the U.S. Senate. The attorneys general advocate for certain amendments that they say would confirm states’ authority to enforce actions against patent trolls. The letter also seeks clarification that state courts have jurisdiction over patent trolls that target businesses in their respective states. And the attorneys general support legislation that would require a patentee to disclose certain information prior to litigation being filed, rather than after.

Read the complete letter that was signed by 42 attorneys general here.