Patent trolls may have to pay legal costs

Proposed bill puts burden on plaintiff to pay fees if suit is likely to fail

Patent trolls beware! A couple of congressman may make business for you a lot harder.

Rep. Peter DeFazio, D.-Ore., and Rep. Jason Chaffetz, R.-Utah, have introduced a bill that would make patent trolls—more kindly known as nonpracticing entities—responsible for the legal fees of defendants if a court decides the case doesn’t have a reasonable likelihood of success.

Patent trolls, by definition, purchase patents and then sue companies they claim are infringing those patents. Oftentimes, small companies are forced to settle those suits because it would be cheaper than engaging in expensive litigation—even if the patent troll’s suit has little merit. “This American Life” reported on the ongoing problem of patent trolls last year.

The new bill, called the Saving High-tech Innovators from Egregious Legal Disputes Act (the SHIELD Act), changes all of that.

“Patent trolls don’t create new technology and they don’t create American jobs,” DeFazio said in a statement. “They pad their pockets by buying patents on products they didn’t create and then suing the innovators who did the hard work and created the product. These egregious lawsuits hurt American innovation and small technology start ups, and they cost jobs. My legislation would force patent trolls to take financial responsibility for their frivolous lawsuits.”

DeFazio said he doesn’t know of any objections to the bipartisan SHIELD Act.

Contributing Author

Cathleen Flahardy

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