National Restaurant Association Member Discusses Damaging Impact of Patent Trolls before Congressional Committee

Published on : Friday, November 15, 2013

National Restaurant AssociationTestifying on behalf of the National Restaurant Association today, Jamie Richardson of White Castle System, Inc. discussed the impact of patent assertion entities (commonly known as patent trolls) on our nation’s economy.


Richardson, Vice President of Government, Shareholder and Community Relations for White Castle, testified before the House Energy and Ccommerce Oversight and Investigations Subcommittee in a hearing entitled “The Impact of Patent Assertion Entities on Innovation and the Economy.” Richardson discussed the imminent threat patent trolls pose to the restaurant industry, which supports nearly one million businesses and 13.1 million employees nationwide.


“The restaurant industry is under constant assault from litigious claims made by patent trolls,” said Richardson. “Their frivolous infringement demand letters are stifling innovation and stunting growth among small business. Congress must put an end to their baseless scare tactics so the restaurant industry and small business community can continue to provide an ever-evolving experience for our customers.”


National Restaurant Association data shows that roughly 50 percent of combined full-service and limited-service restaurants plan to spend more of their budgets on customer-facing technology such as Wi-Fi, iPads/tablets, and smartphone apps. Frivolous claims made by patent trolls will create unnecessary barriers on the integration of new restaurant technology.


Richardson called on Congress to move forward on patent reform, highlighting the need for increased transparency on demand letter claims and focusing on finding solutions that make it more difficult for patent trolls to prey on end-user companies, such as restaurants.


“At White Castle, we have employed our recent innovations to enhance the restaurant experience for our loyal customers,” Richardson told committee members. “Unfortunately, our newer ’firsts’ have come under fire from frivolous patent assertion entity claims – claims now impacting our business decisions and making it harder to provide our customers with the experience they want and expect. In order to continue to strive as a leader, job-creator, and innovator, it is essential we are able to integrate new technologies without daily fear of receiving frivolous patent assertion litigation demands.”


Richardson also addressed the economic strain trolls place on restaurants and consumers. “Over the past two years, the portion of our legal budget spent on these issues has grown from a quarter of one percent to nearly 20 percent,” said Richardson. “In addition to tangible costs associated with patent trolls, the opportunity cost both to White Castle and our customers is real.”


In addition to Richardson’s testimony, the NRA has been increasingly active in educating Congress on the damage patent trolls cause to the restaurant industry and its consumers. The NRA, along with 36 of its state restaurant association partners, recently sent a letter to Senate Judiciary and Commerce committee leadership urging them to move forward on parent reform just last week.


“Patent trolls are continuing to exploit restaurant businesses and drain and more than $80 billion out of our economy each year. Demand letter disclosure, increased transparency, and patent litigation reform will help provide significant relief for the restaurant and foodservice industry.” said Scott DeFife, Executive Vice President of Policy and Government Affairs for the National Restaurant Association.


Source:- National Restaurant Association

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