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Published on : Thursday, November 7, 2013
In advance of tomorrow’s hearing of the Senate Commerce, Science and Transportation Committee at which members will discuss the practices of patent assertion entities (PAEs), the American Hotel & Lodging Association (AH&LA) and 29 of the group’s partner state associations sent a letter to Committee Chairman Jay Rockefeller (D-WV) and Ranking Member John Thune (R-SD), along with Senate Judiciary Committee Chairman Pat Leahy (D-VT) and Ranking Member Chuck Grassley (R-IA), to demonstrate the significant impacts of “patent troll” lawsuits and reiterate the importance of patent reform to the lodging industry.
This hearing is being held just one week after a similar hearing of the House Judiciary Committee examined the recently-introduced Innovation Act (H.R. 3309), introduced by Congressman Bob Goodlatte (R-VA).
In the letter, the lodging industry highlights the fact that PAEs, otherwise known as patent trolls, purchase patents on inventions for products they do not manufacture, and then sue or threaten to sue organizations they claim infringe on the patents. The filing of these frivolous lawsuits has increased recently, with innocent product purchasers, such as hotels providing wireless Internet access for their guests, being targeted by PAEs seeking to earn a quick settlement. These frivolous lawsuits, which are an abuse of the patent protection system and difficult to fight, pose a significant financial burden on the lodging industry.
“Our nation’s small businesses, including many hotels, are facing an ever-increasing number of frivolous patent troll lawsuits that each year cost the U.S. economy $80 billion in lost revenues and productivity,” said Katherine Lugar, AH&LA president and CEO. “A majority of the lodging industry is made up of small businesses, with approximately 55% of hotels numbering fewer than 75 rooms, which are ill-equipped to fight these lawsuits. In many instances, owners and operators do not have the financial resources to fight this aggressive litigation, and often their only recourse is to settle.”
“We are grateful to Chairman Rockefeller for convening this timely hearing,” Lugar continued, “and look forward to working with the members of the committee to craft a permanent solution to this issue.”