The Massachusetts tech industry may finally have a weapon against patent trolls.
State lawmakers are moving to increase penalties against the so-called trolls: individuals or firms who try to hijack other companies’ intellectual property for a payoff. A measure that would ban “bad faith” assertions of patent infringement, and allow for triple damages in successful defenses, was included in an economic development bill passed by the state Senate on Wednesday. The House version of that bill doesn’t include the patent troll measures.
Formal sessions end for the year on July 31, so lawmakers have only a few days left to resolve their differences.
Patent trolls have vexed the tech industry. The trolls often make numerous patent claims against companies, threatening litigation and asking for a payout.
Many targets simply pay to make the nuisance go away, even when the claims are bogus.
At least 30 states already have anti-troll laws on the books.
“The fact that Massachusetts doesn’t have one when entrepreneurship is such an important part of our economy is kind of embarrassing,” said Senate Eric Lesser, co-chairman of the Legislature’s economic development committee.
Lesser has tried to make the current anti-troll measure more palatable than one that died in 2016, in part by adding language to clarify how courts should differentiate between good-faith patent claims and bogus ones.
“Massachusetts is a little late to the party, but it is still welcome legislation to people who have small businesses and continue to get these letters,” said Jason Kravitz, an intellectual property lawyer with Nixon Peabody in Boston. “My personal perception is that these statutes [in other states] have had an impact on deterring the silliest of the troll cases.”
Christopher McWhinney, an intellectual property lawyer at Sullivan & Worcester, said the Massachusetts measure “strikes a fair balance.” But he has heard concerns that efforts like this one can become overly broad and could hurt individuals and organizations with good-faith claims.
Indeed, Richard Baker, a consultant who advises inventors on patent issues, said the new bill tilts too much in favor of big established companies, while taking away power from inventors with legitimate patents, particularly those without the resources to fight for their claims in court.
“We’re an innovation economy here in Massachusetts [and] we don’t need a law like this killing the inventors,” Baker said. “There are a lot of ways big companies can stick it to inventors at the federal level already.”