In 2013, Vermont became the first state to pass an “anti-patent troll” law. Since then, more than 30 states have passed similar laws to rein in patent trolls. These efforts, which range from allowing companies and states to sue patent trolls for bad-faith assertions, to providing civil penalties and to giving companies that are targeted the opportunity to seek damages, have helped discourage trolls from targeting small businesses and inventors.
Unsurprisingly, over the last several years, a handful of states have been challenged in court by patent trolls who argue that these laws are unconstitutional and infringe on federal patent law. An Idaho law, the most recent target of such challenges, imposes a bond requirement on NPEsNon-Practicing Entity. A broad term associated with trolls but now disfavored because it includes universities and legitimate technology developers that seek to license technology in advance rather than after a producing company has independently developed it. More. This measure requires NPEsNon-Practicing Entity. A broad term associated with trolls but now disfavored because it includes universities and legitimate technology developers that seek to license technology in advance rather than after a producing company has independently developed it. More to prove that, if they are found to be likely to have violated the bad-faith assertion law, they will be able to pay any penalty imposed by the law. This helps deter NPEsNon-Practicing Entity. A broad term associated with trolls but now disfavored because it includes universities and legitimate technology developers that seek to license technology in advance rather than after a producing company has independently developed it. More from making bad-faith assertions. In other words, it forces NPEsNon-Practicing Entity. A broad term associated with trolls but now disfavored because it includes universities and legitimate technology developers that seek to license technology in advance rather than after a producing company has independently developed it. More to think twice before they target a small business for patent infringement.
The Idaho case stemmed from a patent infringement claim that was filed by Longhorn IP LLC and Katana Silicon Technologies LLC against chip maker Micron Technology Inc. in 2022. Under the Idaho law, a federal judge ordered Katana to post an $8 million bond based on accusations that the patents were asserted “deceptively.” In response, Longhorn called the law “the most extreme” statute in the country, arguing that it, “and particularly its bond provision are unconstitutional and preempted” by federal law.
The pushback was swift. We at CCIA submitted a brief alongside the High Tech Inventors Alliance in support of the Idaho law, explaining that it is not only essential for preventing abuse in the patent system, but is in full compliance with federal patent law. “This Court,” we wrote “should uphold the judgment below, finding that the Idaho bad faith assertion statute is not preempted as the court below found, in line with the decisions of other district courts around the country examining similar state bad faith patent assertion laws.” The 34 state legislatures that have passed similar laws, we argue, have the right to protect local businesses from abuse and “the Federal CircuitSee CAFC should not lightly second-guess these states and their elected legislatures.”
We were not alone. Twenty-seven states, led by North Carolina Attorney General Joshua H. Stein, submitted a separate brief, outlining a similar argument and urging the appeals court to side with Micron and the state of Idaho.
While the NPEsNon-Practicing Entity. A broad term associated with trolls but now disfavored because it includes universities and legitimate technology developers that seek to license technology in advance rather than after a producing company has independently developed it. More argue that this is a case of federal vs. state law, it’s not really about that at all. Not only are these state laws legal and in compliance with federal court precedents, but they are common-sense measures that help deter abuse in our court system and protect American businesses and inventors from costly and unfair litigation – something we should all be able to support.
