It’s nothing but extortion, says the Consumer Technology Association (CTA) this week.
We’re talking about patent trolling, of course.
In fact, Gary Shapiro, the president and CEO of CTA (formerly Consumer Electronics Association), spoke at the recent Senate Committee on Small Business and Entrepreneurship hearing addressing the topic “An Examination of Changes to the U.S. Patent System & Impacts on America’s Small Businesses.”
“Patent trolls engage in legalized extortion, costing small businesses jobs and sometimes even forcing entrepreneurs into bankruptcy,” Shapiro told the panel. “Eighty percent of patent troll victims are small and medium-sized businesses, including some of CTA’s small business entrepreneurs. Unfortunately, most small businesses have no choice but to pay trolls’ extortion demands because they can’t afford to pay for a lengthy court fight to prove their innocence.”
Patent trolling is when a person or company seeks to enforce patent rights against accused infringers that go far beyond a patent’s actual value or which have created no actual marketplace contribution.
“Congress needs to stop abusive patent trolling that not only hurts entrepreneurs, but undermines the economy – draining an estimated $ 80 billion from the U.S. economy each year,” insisted Shapiro. “That’s $ 1.5 billion every week that entrepreneurs could be investing in R&D or hiring more employees. We urge the Senate to pass the Patent Act to protect small business owners across the country from patent extortion.”
Other small business owners also spoke out, according to a news release.
“Technology startups are a crucial part of the nation’s economy, but the need for patent reform affects so much more than just my industry,” said Austin Meyer, the founder of Laminar Research and creator of X-Plane. “Businesses of all sizes – from Main Street retailers and hotels to grocers, convenience stores and cafes – have been the victims of unnecessary lawsuits and overly broad claims by patent trolls. Congress must stand with American businesses that create goods and services, rather than with those that destroy them, and support comprehensive patent reform.”