A couple of congressmen today reintroduced a bill that will likely command a standing ovation throughout Silicon Valley. Peter DeFazio (D-Ore.) and Jason Chaffetz (R-Utah) are taking aim at so-called patent trolls with a proposal that would force them to pick up the tab for a defendant's legal costs if their patent lawsuit fails to prevail.
This is the second time around for the Saving High-tech Innovators from Egregious Legal Disputes, or SHIELD Act. The co-sponsors first submitted the bill last August, but the provision withered on the political vine for a couple of reasons. The bill faced strong opposition from trial lawyers. It also wasn't the sort of big political vote getter that politicians love to rally around. This time around, though, the co-sponsors believe that they have a better chance of passing their proposal into law. The retooled SHIELD act offers a less objectionable way of determining who will be liable, according to DeFazio. Also, it would extend to all industries, not just high tech.
"The more that patent trolls go after companies, the more it helps us," DeFazio said in an interview with CNET News.com.
The SHIELD Act would not apply to plaintiffs in lawsuits where they invented the patent or produced evidence of having made a substantial investment in bringing the patent to market.
"Nothing's ever easy around here, but we're feeling pretty confident," DeFazio said. "There are a few things that can rise above partisanship, occasionally."
Earlier, he and his co-sponsor, Chaffetz, put out a statement accusing patent trolls of draining an estimated $29 billion from American innovators and companies last year.
They also have lined up widespread business support for the the SHIELD Act, including the likes of the Consumer Electronics Association, the Electronic Frontier Foundation, Engine Advocacy, the National Retail Federation, the Coalition for Patent Fairness, the Consumer and Communications Industry Association, Expedia, Kayak, Orbitz, and Travelocity. Another possible help: the White House. During a Google Hangout appearance earlier this month, President Obama specifically mentioned the problem patent trolls present to businesses, old and new:
I'm an entrepreneur, and I think startups are an important engine of the American economy. But when I go around and talk to other entrepreneurs, what I hear is, they're worried that if they become successful, they're going to be targeted by software patent trolls. These are firms that collect software patents just for the purpose of litigation, and getting money out of small companies that can't afford patent defense, they're expensive. So, I know you've made a lot of progress on patent reform, but I'm wondering, what are you planning to do to limit the abuses of software patents? For example, would you be supportive of limiting software patents to only five years long?