By David Ingram
WASHINGTON (Reuters) - Lawyers for major corporations told
U.S. lawmakers they would welcome antitrust enforcement against
so-called "patent trolls," raising pressure to act against them
just as antitrust enforcers are weighing their options.
Derided by critics for causing a spike in patent litigation,
the patent companies in question, known as trolls, specialize in
buying up patents solely for the purpose of filing infringement
suits or demanding licensing fees. Major corporations say they
spend millions of dollars each year defending against the suits.
Supporters of the companies say they benefit small inventors
and maximize the value of patents.
During a hearing on Thursday on what to do about the flood
of patent suits, Representative Howard Coble, a North Carolina
Republican, asked witnesses about the possibility of invoking
Coble is chairman of the U.S. House subcommittee on
Cisco Systems Inc General Counsel Mark Chandler responded
that the patent companies, sometimes called patent aggregators,
may threaten competition just as monopolies do.
"The patent aggregation efforts deserve very close antitrust
scrutiny for that reason," Chandler told the subcommittee. "They
have the impact across whole industries of forcing settlements
(of patent suits) and suppressing competition in ways that are
not intended as part of the patent grant."
The two U.S. antitrust enforcement authorities, the Justice
Department and the Federal Trade Commission, are deliberating
how to react.
In December the two agencies held a joint public workshop,
and they are accepting written public feedback through April 5.
J.C. Penney Co Inc General Counsel Janet Dhillon, also
testifying on Thursday, agreed with the call for more scrutiny.
"We support that effort," she said.
Antitrust enforcers, though, would need to make a case that
they had authority under competition laws, said C. Graham Gerst,
a partner at Global IP Law Group who specializes in patent
litigation and testified at the hearing.
"It's hard to conceive that these patent assertion entities
have anything approaching market power," he said. The companies
criticized as trolls are sometimes called patent assertion
entities. But, Gerst added, "I'm not an antitrust lawyer."
(Additional reporting by Diane Bartz)
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