Last week, the Senate Committee on Commerce, Science & Transportation conducted a hearing on patent troll demand letters.
The hearing was led by Sen. Claire McCaskill (D-MO) who called patent assertion entities “bottom feeders.” These entities are “scam artists” who prey on the vulnerable, getting them to pay damages instead of facing the high costs and uncertainty of litigation.
Several of the witnesses, including Cisco Systems general Counsel Mark Chandler, Nebraska attorney general Jon Bruning (R), and BrandsMart USA executive vice president Lary Sinewitz gave testimony about particular instances where demand letters had been received that were clearly outrageous. Yet, companies and individuals often pay to get rid of these allegations.
Jon Potter of the industry trade group Application Developers Alliance called these letters fraudulent. He and several others called on Congress to require these letters include sufficient specificity to permit companies and individuals to respond to them in an appropriate manner. They should include specific patent claims that are infringed and specific products that are alleged to be infringed. The letters should include information on the real patent owners and real parties in interest. Another proposal was for any company that sends out ten or more of such demand letters to companies that neither manufacture nor sell the accused product be required to deposit a copy of such demand letters in a government registry that can be reviewed by others to help determine an appropriate response.
Meanwhile, Professor Adam Mossoff of George Mason School of Law urged lawmakers to be cautious with new legislation. There may be unintended consequences of harming legitimate patent owners whose patents are being infringed. There are existing rules and procedures for handling bad patents and bad actors.