Wisconsin Assembly Approves Patent Troll Bill

On March 20, 2014, the Wisconsin Assembly passed Senate Bill 498, a bill similar to legislature introduced in the U.S. Senate aimed at curbing the effects of non-practicing entities, otherwise known as patent trolls. The bill was signed into law by Governor Walker on April 23, 2014. Read more about the pending U.S. Senate legislation here.

The statute attempts to curb the practices of patent trolls by implementing specific requirements that patent-licensing demand letters must meet, such as including the number of the patent that is allegedly infringed, the name and contact information of the patent owner, and “an analysis setting forth in detail” of the infringement. The goal of the statute is to curtail the activities of patent trolls, who typically own patents but do not use the technology itself, instead deriving income by demanding patent licensing payments based on vague allegations of infringement along with a threat of litigation.

The statute also allows recipients of allegedly incomplete or misleading letters to notify the sender of any deficiencies. If these deficiencies are not cured within 30 days, the recipient may initiate a civil court action. In addition, the bill authorizes the state attorney general to investigate alleged violations and imposes penalties of up to $50,000 for each violation.

Several types of patent demand letters are exempt from this bill, including those sent by an institution of higher education and those involving patents subject to approval by the U.S. Food and Drug Administration.

The statute is likely to affect the actions of patent trolls, but may also have an impact on other patent owner’s strategies for communicating with potential infringers. To learn more about how this new law could affect your particular situation, contact your Boyle Fredrickson attorney.