WASHINGTON—The House Subcommittee on Courts, Intellectual Property & the Internet will hold a hearing today on patent reform, an issue of concern to credit unions that have found themselves on the defendant end of lawsuits by patent trolls.
In advance of the hearing on the bill, "Protecting American Innovators and Job Creators from Abusive Patent Litigation,” NAFCU has sent a letter noting that a “growing number of credit unions are reporting receipt of demand letters from law firms representing patent assertion entities, claiming patent infringement, with the option to settle or face litigation.
“These deceptive letters are confusing and misleading as they often allege that the use of everyday technology violates the patent holders’ rights,” said NAFCU’s VP-legislative affairs, Brad Thaler. “Further, these letters typically state vague or hypothetical theories of infringement, and often overstate or misinterpret the patent in question. Because the cost of litigation is often more expensive than paying a settlement amount, these ‘patent trolls’ use the threat of litigation as leverage to extract payment from the recipient business who settles in lieu of running the risk of a complex and lengthy legal battle. Unfortunately, too many credit unions and their members are victims of this abusive practice.”
NAFCU said it believes a legislative solution is necessary to alter the intimidating business model used by these patent assertion entities and will continue to be supportive of any Congressional effort to curb these practices.
Meanwhile, CUNA has sent a letter to the House Committee on Financial Services in which it offers comment on nine different bills currently before Congress in which credit unions have an interest.
The full text of the CUNA letter can be found here.