2015 Patent Trolling Legislation

Jonathan Griffin 6/15/2016

Patent Trolling

Nineteen states have introduced legislation to create or amend state laws that punish bad faith patent assertions, common referred to as “patent trolling.” Twenty-seven states now have anti-patent troll legislation, as nine states - Colorado, Florida, Indiana, Kansas, Mississippi, Montana, North Dakota, Texas and Washington - have enacted legislation in 2015, joining seventeen additional states that did so in 2014

While patent law is traditionally a federal issue, in May 2013, Vermont became the first state to pass legislation to attempt to halt patent trolling.  In total, twenty-seven states have enacted legislation on this topic since 2013.  The federal government has also decided to re-examine the issue and have introduced a patent trolling component of H.R. 9, “The Innovation Act.”

Adopted or enacted legislation is listed below, in bold.

Patent Trolling Legislation

Jurisdiction

Bill Number

Summary

California

AJR 9 - 7/21/2015 - Adopted

Urges the President and the Congress of the United States to craft a balanced and workable approach to reduce incentives for and minimize abusive and frivolous patent litigation while ensuring that legitimate patent enforcement rights are protected and maintained.

Colorado

HB 1063; 6/5/2015 - Enacted

Concerns prohibited communication concerning patents.

Florida HB 439; 6/2/2015 - Enacted Prohibits bad faith assertions of patent infringement from being made and provides factors that a court may consider when determining whether an allegation was or was not made in bad faith, among other provisions.

Florida

HB 1103; Failed

Relates to patent infringement; creates Patent Troll Prevention Act; prohibits bad faith assertions of patent infringement from being made; provides factors that courts may consider when determining whether an allegation was or was not made in bad faith; authorizes courts to require a patent infringement plaintiff to post bond under certain circumstances; limits bond amount; authorizes courts to waive the bond requirement in certain circumstances; authorizes private rights of action for violations.

Florida

SB 1084; Failed

Relates to patent infringement; creates provisions entitled the Patent Troll Prevention Act; prohibits bad faith assertions of patent infringement from being made; authorizes a court to require a patent infringement plaintiff to post a bond under certain circumstances; authorizes private rights of action for violations of this part; requires a bad faith assertion of patent infringement to be treated as an unfair or deceptive trade practice.

Florida SB 1362; Failed Revises the list of offenses that may be investigated and prosecuted by the Office of Statewide Prosecution; specifies the distribution of certain funds recovered in Medicaid fraud actions; relates to patent infringement; revises provisions concerning the operation of a motor vehicle, boat, or aircraft; revises the maximum victim compensation amounts that the department may award to elderly persons or disabled adults who suffer certain losses; specifies provisions for relocation assistance.

Illinois

HB 2691

Amends the Consumer Fraud and Deceptive Business Practices Act; provides that it is an unlawful practice to claim that another has infringed upon a copyright if the claim falsely threatens adverse administrative or judicial action, the assertions lack a reasonable basis in fact or law, the person making the assertion is not, or does not represent, a person with a current right to license the copyright, or the claim fails to make certain other disclosures.

Indiana

HB 1102

Prohibits a person from asserting a claim of patent infringement in bad faith; provides that a court may, upon motion, require a person to post a bond if the target establishes a reasonable likelihood that the person has made an assertion of patent infringement in bad faith; establishes remedies, damages, and civil penalties; relates to the International Trade Commission, end users and demand letters; includes technology transfers from an approved postsecondary educational institution.

Iowa

SSB 1028

Creates a private right of action for bad‑faith assertions of patent infringement; prohibits a person from making a bad‑faith assertion of patent infringement; provides lists of factors that a court may consider as evidence that a person's assertion of patent infringement was either made or not made in bad faith; provides that a violation of the an unlawful practice and that the attorney general's rights and remedies are not in any way limited by the creation of the private right of action.

Kansas

SB 38

Relates to bad faith assertions of patent infringement.

Maine

HB 117; Failed

Current law prohibits a person from making a bad faith assertion of patent infringement against another person. A person who does make a bad faith assertion may have to pay remedies awarded by the court, including equitable relief, damages, costs and fees and punitive damages; however, the law exempts persons seeking relief pursuant to 35 United States Code, Section 271(e)(2) or 42 United States Code, Section 262 from the law prohibiting bad faith assertions of patent infringement.

Massachusetts SB 178 Protects Massachusetts businesses from abusive patent infringement claims.
Michigan HB 4587 Prohibits and provides remedies for claims of patent infringement made in bad faith
Michigan SB 289 Prohibits and provides remedies for claims of patent infringement made in bad faith; prohibits the bad-faith assertion of patent infringements; provides remedies for the bad-faith assertion of patent infringements; provides for the powers and duties of the attorney general; authorizes the promulgation of rules.

Minnesota

HB 1586

Relates to commerce; prohibits assertions of patent infringement in bad faith; authorizes a court to consider certain factors as evidence of whether an assertion of patent infringement in bad faith or good faith has been made; provides enforcement; defines certain terms.

Minnesota

SB 1321

Relates to commerce; prohibits assertions of patent infringement in bad faith; authorizes a court to consider certain factors as evidence of whether an assertion of patent infringement in bad faith or good faith has been made; provides enforcement; defines certain terms.

Mississippi

HB 232; Failed

Prohibits bad faith assertions of patent infringement; makes certain legislative findings; defines certain terms; provides factors that the court may consider in determining whether a bad faith assertion of patent infringement has been made; provides procedures for actions under this act; provides for a demand letter in an action; requires the posting of bond; provides for enforcement, remedies and damages.

Mississippi

HB 589

Prohibits bad faith assertions of patent infringement; makes certain legislative findings; defines certain terms; provides factors that the court may consider in determining whether a bad faith assertion of patent infringement has been made; provides procedures for actions under this act; provides for a demand letter in an action; requires the posting of bond; provides for enforcement, remedies and damages of this act.

Montana

SB 39

Revises patent and copyright trolling laws; relates to consumer protection; provides for the civil offense of bad faith assertion of a patent right, including remedies and damages available for the offense.

North Dakota

HB 1163

Relates to bad faith assertions of patent infringement; provides a penalty for violations; relates to a demand letter and threats of legal action that cannot legally be taken; provides for bonds, damages, costs and fees.

New Jersey

AB 2462

Prohibits bad faith assertion of patent infringement; exempts a written communication related to a patent that is required or authorized under certain provisions of federal law, or certain requests for disclosure sent by certain patent owners, an institution of higher education, or a technology transfer organization with a specified purpose; requires certain persons to post a bond; provides for certain civil actions and damages.

New Jersey

SB 1563

Prohibits bad faith assertion of patent infringement.

Ohio HB 194 Prohibits a person from engaging in the widespread sending of bad faith, objectively baseless communications of patent infringement; authorizes the Attorney General to investigate and institute a civil action if the Attorney General believes a person has made such assertions of patent infringement.

Rhode Island

HB 5455

Would authorize the attorney general and/or aggrieved persons to file a bad faith patent infringement suit seeking equitable and/or monetary relief including punitive damages in connection with frivolous patent infringement claims. This act would take effect upon passage.

Rhode Island

SB 596

Would authorize the attorney general and/or aggrieved persons to file a bad faith patent infringement suit seeking equitable and/or monetary relief including punitive damages in connection with frivolous patent infringement claims. This act would take effect upon passage.

South Carolina

HB 3682; ENACTED IN 2016 (6/9/2016)

Enacts the Bad Faith Assertion of Patent Infringement Act; provides that bad faith assertions of patent infringements are prohibited; defines terms; provides for a private cause of action in state courts by a recipient of a bad faith assertion to patent infringement; provides that enforcement actions may be brought by the attorney general and wilful and knowing violations may result in civil penalties of not more than fifty thousand dollars for each violation.

Texas

HB 3176

Relates to claims of patent infringement; provides civil penalties; imposes fees.

Texas

SB 1187

Relates to claims of patent infringement; provides civil penalties; imposes fees.

Texas

SB 1457; 6/17/2015- Enacted

Relates to bad faith claims of patent infringement; provides a civil penalty; creates a criminal offense.

Washington

HB 1092

Creates the patent troll prevention act.

Washington

SB 5059

Creates the Patent Troll Prevention Act; provides that a person may not make assertions of patent infringement in bad faith; provides a definition of such assertions.

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Jon Griffin covers intellectual property issues for NCSL.  You may contact him by email at jonathan.griffin@ncsl.org.