Broad Coalition Urges Congressional Action on Patent Reform

Patent reform is one of the i2Coalition’s top legislative priorities. Members of the Internet infrastructure industry are all too familiar with the destructive impact that patent assertion entities (PAEs), commonly referred to as patent trolls, cause. The frivolous lawsuits filed by these patent trolls stifle innovation. Such litigation forced companies that were unfairly targeted to spend valuable resources to the tune of $29 billion in direct payouts in 2011.

While our industry is often one of the prime targets for patent trolls, we are not alone. Patent trolls are a systemic problem and hurt various types of businesses throughout the U.S. Earlier this week i2Coalition members Google, Rackspace, and MediaTemple joined 40+ other companies from a broad cross section of industries in co-signing a letter to Congressional leaders urging for the expansion of the Covered Business Method (CBM) Program. The signatories included a wide-range of businesses from retail stores to restaurants. Timothy Lee detailed the broad coalition in a worthwhile read on Washington Post blog The Switch:

Retail outlets like J. Crew and Macy’s signed the letter. So did grocery stores like Safeway and Kroger. And home shopping networks Jewelry Television and QVC.

Even Whataburger, the hamburger chain popular in the south, is demanding changes to the patent system.

“We’re a burger company. We don’t own any patents. We make hamburgers,” says Whataburger general counsel Michael Gibbs. But in the last two years, he says, he’s been forced to deal with patent threats.

Gibbs says Whataburger has faced legal threats for using ethernet networking equipment and for putting calorie information on its Web site. And he says Whataburger scuttled plans to offer Wi-Fi access to its customers after learning that a troll had started suing companies that offered Wi-Fi services.

The full letter and list of supporters may be viewed here [PDF]. We applaud these companies for standing up for reform on such a critical issue and look forward to legislative action to address the ongoing abuse of the patent system.