ANA Calls for “Patent Troll” Demand Letters to Be Legislatively Addressed
ANA, along with 20 other trade associations representing a wide swath of industries, has sent a letter to members of the House and Senate Judiciary Committees asking them to address demand letters as a part of their legislative efforts to curb patent trolling. Specifically, it encourages the Judiciary Committees to include language covering unfair and deceptive demand letters. So called “demand letters” are often the first step in patent troll litigation. As our we describe, patent trolls will send letters to businesses vaguely describing alleged infringement of patents, often for use of everyday technologies. The letters threaten litigation unless a licensing fee is paid by the targeted business.
Given the cost of litigation, many businesses choose to settle. This economic reality allows for a business model for trolls built on little more than extortion that is extremely harmful to businesses. While House Judiciary Chairman Goodlatte’s bill (that is supported by Senate Judiciary Chairman Leahy) overhauls the patent litigation problems, it does not reach demand letters which occur pre-litigation. However, much of the financial damage to business occurs at the demand letter stage.
If you have questions, please contact Dan Jaffe in our Washington office at 202-296-1883 or via email (firstname.lastname@example.org).