LEGAL NEWSLINE

PORTLAND, Maine (Legal Newsline) -- A Maine lawmaker has introduced legislation that would make patent trolling more difficult in the state.

State Sen. Anne Haskell, a Democrat, submitted Senate Paper 654 last month.

The legislation, An Act Regarding Bad Faith Assertions of Patent Infringement, is co-sponsored by state Reps. Seth Berry, Jennifer DeChant, Lori Fowle and Jeff McCabe, all Democrats, and Michael Beaulieu, a Republican.

Under SP 654, any company or person can file a lawsuit in superior court against someone who has made a bad faith assertion of patent infringement against them.

The court may award equitable relief, damages, costs and fees, including "reasonable" attorneys fees, and punitive damages equal to $50,000 or three times the total damages, costs and fees -- whichever is greater.

Also under Haskell's proposed bill, the state attorney general may bring an action for a bad faith assertion in violation of the state's Unfair Trade Practices Act.

Haskell, who sits on a bank board, said she decided to introduce the legislation when she heard that quite a few banks in the state were hit by companies claiming to have patents on the banks' ATM software.

"These banks have been put in a position to figure out what it would cost to pay them (the trolls) off instead of paying for litigation," she said Tuesday.

"Basically, they're in a hostage situation and, most of the time, they simply have to write a check."

Haskell said she realizes the bill, if it passes, won't prevent all patent trolling, but she believes it could make a significant impact.

"This will give businesses a foundation to legally write back to these companies and say, no, under Maine law, we assert you are a sham company and you don't hold any standing," she said.

"We're not 'inventing the wheel' here, but it will give businesses in the state a tool to push back."

Last year, nearby Vermont passed and signed into law a similar measure designed to protect companies in the state from patent trolling.

Under Vermont's new law -- much like Haskell's proposed bill -- a court can consider as evidence a letter that does not provide the patent number, the name and address of the patent owner and/or assignee, or an explanation of how the target company's products or services infringed on the patent.

The court also can consider if the letter demands payment of a license fee or a response in an "unreasonably short" period of time.

The Vermont law also allows the state attorney general to conduct civil investigations and bring civil lawsuits against violators, and the court may award relief or damages.

Maine Attorney General Janet Mills agreed patent trolling is a growing problem in the state, and is keeping an eye on Haskell's bill.

"I am very concerned that Maine businesses may be targeted by overly broad patent infringement claims in an attempt to do nothing other than separate money from them," Mills said Wednesday. "If Maine businesses are receiving letters from patent assertion entities, my office wants to know about it."

She continued, "I have joined other attorneys general in calling for the Federal Trade Commission to investigate this phenomenon, and we are watching the state legislation closely to see if it can help legitimate business interests."

Amy Cookson, deputy communications director for Senate Democrats, said the Senate Judiciary Committee will hold a public hearing on Haskell's bill Feb. 4.

After that, the committee will schedule a work session on the bill and vote on it. The bill then will be sent to the Senate for floor debate and a vote, she explained.

The legislative session began Jan. 8 and is scheduled to adjourn April 16.

From Legal Newsline: Reach Jessica Karmasek by email at patents@legalnewsline.com.