IP Policy

COMBATING lawsuits by Patent Assertion entities

CEA supports legislation that combats the recent explosion of lawsuits brought by patent assertion entities (PAEs), better known as ‘patent trolls.’ Patent trolls do not create products, but simply bring lawsuits against those who do. Every dollar companies spend fighting baseless lawsuits is a dollar not spent on creating jobs and developing new products, which makes it more difficult for the American consumer electronics industry to compete internationally

  • August 6, 2013 - CEA sponsored the new “Trolling Effects” project. Trolling Effects is a new and innovative resource in the fight against patent trolls. The website allows patent troll demand letter recipients to post the documents online, find letters received by others, and research exactly who is really behind these threats. The following statement can be attributed to Gary Shapiro, president and CEO, CEA, in response to this project:

    “Research reveals that abuses in the patent litigation industry are costing innovators more than $80 billion annually in direct and indirect costs. By stripping away the secrecy that allows patent trolls to thrive, Trolling Effects will allow innovators to respond more strategically and effectively to patent troll threats.

    “We thank the Electronic Frontier Foundation (EFF) for spearheading this important project. Initiatives like Trolling Effects – coupled with smart legislation from Congress – promise an end to the patent troll plague and allow entrepreneurs to innovate without constant threat of frivolous lawsuits.”
  • July 17, 2013 - CEA, along with 49 other trade associations and public interest groups, sent a letter to both House and Senate leadership urging them to help combat Patent Assertion Entities (also known as PAEs or patent trolls). Because the number of defendants being sued by patent trolls has quadrupled since 2005, the 50 organizations asked members of congressional leadership to work together "across the aisle and across chambers" to pass legislation that fights these malicious entities since "'managing frivolous patent suits unfortunately has become an expensive distraction for a large cross-section of American businesses."

Internet Freedom

CEA supports Internet Freedom, both at home and abroad. The open and uncensored Internet is a great engine of social and economic progress – but it is under threat. Through the United Nation’s agency, the International Telecommunication Union (ITU), a number of countries are attempting to establish greater governmental control of the Internet. Their efforts, if successful, could destroy the open and innovative technology platform that millions around the world need and trust. CEA commended Ambassador Terry Kramer and the U.S. for refusing to sign the revised International Telecommunication Regulations (ITRs) in December 2012. CEA continues to support an open Internet and encourages the federal government to make it the official policy of the United States to promote a global Internet free from government control.

Internet Radio Fairness

Under today’s outdated rules, Internet radio providers are forced to pay a significantly larger percentage of royalties than their competitors. In some cases, Internet radio providers pay half of their annual revenues in performance royalties, while other music providers pay less than 10 percent. The Internet Radio Fairness Act of 2012, supported by CEA after it was introduced during the 112th Congress, would extend to webcasters the same standard for determining copyright royalty rates used by all other forms of non-broadcast radio. By rationalizing the royalty structure, the Internet Radio Fairness Act, if reintroduced and passed, will stimulate investment in the internet music industry. That means more royalties for artists, more choices for consumers, and more exciting new products and services for Internet music.


CEA supports a balanced approach to enforcing intellectual property rights that protects fair use and does not limit advancement of innovation. Last year, CEA hailed the congressional decision to pull votes on the Stop Online Privacy Act (SOPA) in and the PROTECT IP Act (PIPA) which would have hurt legitimate businesses and cost American jobs. We continue to actively oppose legislative and regulatory proposals that unduly burden legitimate commerce, impede innovation or restrict the free flow of information.