Patent News

Mar. 17, 2014

Kentucky Forward Commentary: Stopping the trolls could put us under the bridge, cause more harm than good, by Alex Frommeyer

This article originally appeared in Kentucky Forward on March 17, 2014.

Alex Frommeyer is founder and CEO of Beam Technologies, which is based in Louisville.

Kentucky has a rich history, and an economy with many industries that contribute to it. Perhaps the single most important component of Kentucky’s 21st century economic landscape are our entrepreneurs, startups and innovators. By developing technologies that create jobs and wealth, they are the engine that drives our economy. Current legislative action aimed at reforming the state’s patent system is capable of hurting momentum and the net benefits of the innovation economy.

The Kentucky legislature is currently considering SB 116, legislation focused on “bad faith” patent assertion activities. The purpose of this bill is to protect the state’s businesses from abusive patent practices, but the reality is that it would cause much more harm than good in targeting these harmful activities.

Many large companies have been loud opponents of so-called ‘patent trolls’ who manipulate current patent laws, which have created the conditions for lawmakers to examine intellectual property law reform. Though a great initiative, realistically patent trolling will affect only a small percentage of patent holders, while broad and untested reforms will likely make it substantially more difficult for independent inventors (read: the “little guy”) to be able to enforce their IP. Since intellectual property protection was expressly created for this purpose, this seems to be a difficult circle to square for our well-meaning politicians.

It is also important to note that I have been helping bring a local voice to this issue in Kentucky for the past few months. The reforms that are needed must be done with the small business, startup, and entrepreneur foremost in mind. This dialogue needs include feedback on the unintended consequences the legislation brings from this innovative group who make progress possible. Otherwise, big businesses, who already hold large amounts of issued IP, will be the benefactors.

This is also a federal issue, and Kentucky should be engaged in the debate at the national level, not creating a different set of rules for innovators in the state. This can create a dangerous side effect, placing another barrier in front of an entrepreneur looking at basing a company in Kentucky. With access to scalable capital and talent already major issues, does it really make sense to make intellectual property uniquely contentious?

It’s critical that the state legislature take steps to improve upon this bill, and engage in a healthy dialogue that considers the many implications of passing such sweeping patent reform legislation.