TROL Act heads to House of Representatives after approval

The House Energy and Commerce Committee approved a bill on Wednesday (April 29) that seeks to combat abusive demand letters sent by non-practising entities (NPEs).

In a 30-22 majority the committee approved the bill, known as the Targeting Rogue and Opaque Letters (TROL) Act.

One of the key proposals is to give the Federal Trade Commission (FTC) the power to fine individuals and businesses that have been found to have sent fraudulent patent demand letters.

Last week the Subcommittee on Commerce, Manufacturing and Trade, a branch of the Energy and Commerce Committee, approved the bill in a 10-7 majority.

Fred Upton, chairman of the Energy and Commerce Committee, said: “The bill seeks to protect the ability of small businesses across the country to innovate. When a troll sends abusive demand letters, we provide tools to identify those letters and provide better enforcement.”

Michael Burgess, chairman of the subcommittee and the author of the bill, said: “The legislation takes on a costly scam that, by many accounts, continues to worsen.

“The very real problem of abusive patent demand letters compels us to find a solution expressly designed to enable enforcement that’s free of constitutional setbacks,” he added.

Before the bill was voted on by the Energy and Commerce Committee, some stakeholders had voiced their concerns that the bill did not go far enough to tackle abusive demand letters.

Charles Duan, director of the Patent Reform Project at intellectual property rights group Public Knowledge, stated that while he supports efforts to tackle abusive demand letters, the TROL Act fails to do so.

He said it only weakly protects businesses and individuals and even goes as far as undoing “stronger protections for residents of the 22 states that have enacted individual demand letter laws”.

But some stakeholders have given their support to the bill. Lisa Jorgenson, executive director of the American Intellectual Property Law Association, said that “clarifying FTC oversight with respect to these abusive practices as described in the TROL Act will directly address the abusive behaviour itself, and hopefully ameliorate its negative impact on the patent system”.

The bill will now head to the US House of Representatives.