Policy: Law

Tennessee patent troll bill to be heard by subcommittee

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Tennessee,Law,Patent Law,Legal Newsline

NASHVILLE, Tenn. (Legal Newsline) — Legislation that would allow any Tennessee business or individual to sue if threatened by a so-called “patent troll” is being considered by a House subcommittee this week.

Bell

Bell

The legislation, Senate Bill 1967/House Bill 2117, is one of 38 bills on the House Civil Justice Subcommittee’s calendar for Wednesday.

SB 1967 was introduced by Sen. Mike Bell, R-Riceville, in January. The House version, which is nearly identical, was introduced soon after by Rep. Jon Lundberg, R-Bristol.

The legislation creates a cause of action for targets of bad faith assertions of patent infringement.

Basically, under the bills, if a target makes a motion and a court finds the target has established a “reasonable likelihood” that a person made an assertion in bad faith, the court will require the person to post a bond in an amount equal to a good faith estimate of the target’s costs to litigate the claim and amounts reasonably likely to be recovered.

A hearing must be held if either party requests one. The court may waive the bond requirement if it finds the person has available assets equal to the amount of the proposed bond or for other good cause shown.

Also under the bills, a target may bring an action in any circuit or chancery court.

In addition, the measures give the attorney general the authority to enforce, conduct civil investigations and bring a civil action.

Lundberg

Lundberg

The remedies available to a plaintiff under the legislation include equitable relief; damages; costs and fees, including reasonable attorney’s fees; and exemplary damages in an amount equal to $50,000 or three times the total of damages, costs and fees, whichever is greater.

Under the bills, a court may consider certain factors in determining whether an assertion was made in bad faith, including that the demand letter does not contain the patent number; the name and address of the patent owner or owners and assignee or assignees, if any; and factual allegations concerning the specific areas in which the target’s products, services and technology infringe the patent or are covered by the claims in the patent.

Neither Bell nor Lundberg could be reached for comment on the legislation, which is among the many state measures being introduced to combat patent trolls.

Generally speaking, a patent troll, or non-practicing entity or patent assertion entity, purchases groups of patents without an intent to market or develop a product.

In some cases, but not all, the entity then targets other businesses with lawsuits alleging infringement of the patents it bought.

Nearby Kentucky, Virginia, Maine, Wisconsin and Oregon are in the process of crafting or have passed their own patent troll bills this year.

From Legal Newsline: Reach Jessica Karmasek by email at patents@legalnewsline.com.

Original Story: Tenn. patent troll bill to be heard by subcommittee

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