Vermont becomes the first state in the nation to approve legislation prohibiting bad faith patent infringement claims.
The Vermont House and Senate approved legislation that gives companies in the state the ability to bring lawsuits against so-called “patent trolls”, those patent owners who act in bad faith and threaten to sue or actually sue for patent infringement. Governor Peter Shumlin signed the anti-patent trolling bill into law on May 22nd.
An informal coalition of Vermont companies that had been threatened and injured by patent troll claims of patent infringement brought their concerns to Representative Paul Ralston and Vermont Chamber of Commerce President Betsy Bishop, who then spearheaded legislation to both craft and pass legislation to deal with patent trolls.
Vermont companies will be able to, if they can prove a patent troll acted in bad faith, seek recovery of their legal fees, damages and other remedies under the new law. The new legislation also enables the Vermont Attorney General to bring suit against an alleged patent troll.
Of Interest:
However, experts admit it will be extremely difficult to determine if a company’s claim of patent infringement is a “patent troll” or a legitimate effort to enforce a patent. Vermont’s new legislation will require a court to “apply a multi-factor test to decide whether the patent infringement claim was made in “’bad faith.’
Although Vermont’s patent infringement legislation is innovative and will be advantageous to Vermont companies who are dealing with patent trolls, it will take changes in federal patent law to curb extortionate claims of patent infringement. Fortunately several proposals are under consideration for changing federal patent law.