At Senate Judiciary Committee hearing on patent trolls, Klobuchar highlighted how certain bad actors abuse patent litigation to threaten innovative companies and extract settlements based on questionable claims

Klobuchar, who chairs the Subcommittee on Antitrust, Competition Policy and Consumer Rights, is pushing legislation to help fight patent trolls by increasing transparency and cracking down on widespread frivolous demand letters  

Washington, D.C. – U.S. Senator Amy Klobuchar today discussed how patent trolls hurt small businesses and stifle innovation. At a Senate Judiciary Committee hearing featuring business leaders and patent law experts, Klobuchar highlighted how certain bad actors abuse patent litigation to threaten companies and extract settlements based on questionable claims. Klobuchar, who chairs the Subcommittee on Antitrust, Competition Policy and Consumer Rights, also discussed legislation she is pushing to help fight patent trolls by increasing transparency in patent ownership, protecting customers who are sued for patent infringement, cracking down on the practice of  sending of frivolous demand letters, and improving resources for small businesses that are targeted in patent infringement suits.

“Patent trolls take advantage of loopholes in our patent law to extort small businesses and make a quick buck,” said Klobuchar. “The explosion of frivolous patent lawsuits punishes innovators and drives up costs for consumers, which is why we need legislation that will crack down on bad actors while preserving patent rights that are vital to innovation and competition.”

Witnesses at today’s hearing included: John J. Dwyer, Jr., President & CEO, New England Federal Credit Union; Michael Makin, President & CEO, Printing Industries of America; Dana Rao, Vice President and Associate General Counsel for Intellectual Property Litigation, Adobe Systems, Inc; Philip S. Johnson, Senior Vice President and Chief Intellectual Property Counsel, Johnson & Johnson; Steve Bossone, Ph.D., Vice President, Intellectual Property, Alnylam Pharmaceuticals; Harry A. Wolin, Senior Vice President, General Counsel and Secretary, AMD; The Honorable Q. Todd Dickinson, Executive Director, American Intellectual Property Law, Association, Former Under Secretary for Intellectual Property and Director of the United States Patent and Trademark Office.

The Patent Transparency and Improvements Act, which was cosponsored by Klobuchar and introduced by Senators Patrick Leahy (D-VT) and Mike Lee (R-UT), would improve transparency of patent ownership by requiring plaintiffs in patent cases to disclose their beneficial owners, as well as require patent owners to disclose transfers of interest. The bill also protects customers who are sued for patent infringement by allowing the case against them to be stayed while the manufacturer litigates the suit. It also states clear that the FTC may target bad actors that engage in the widespread sending of frivolous patent demand letters.  Finally, the legislation will direct the Patent and Trademark Office to develop educational resources for small businesses that are targeted in suits and to ensure that the Office’s small business outreach programs include supports for victims of frivolous lawsuits.

Klobuchar is the chair of the Judiciary Antitrust Subcommittee and earlier this year held a hearing examining standard essential patent disputes’ impact on consumers and competition. Specifically, the hearing focused on concerns that consumers may pay higher prices or have limited access to technologies due to disputes over patent licensing rates

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