A Baton Rouge small business owner testified this week before a House Judiciary Subcommittee about what some are calling a disturbing trend in the automotive industry: car companies using design patents to stifle competition at the expense of consumers.
Pat Felder, the owner of Felder’s Collision Parts, testified before the House Judiciary Subcommittee on the Courts, Intellectual Property, and the Internet. The subcommittee discussed H.R. 1057, the “Promoting Automotive Repair, Trade, and Sales Act,” or PARTS Act.
Approval of the act would reduce the amount of time a design patent for auto parts is enforceable. Currently, a design patent lasts for 14 years. The PARTS Act would reduce that timeframe to 30 months for parts used in auto repairs.
Supporters of the act say the current law effectively gives automakers who hold design patents a 14-year monopoly on sales of repair parts, which drives up consumer prices. Approval of the act would open up aftermarket parts competition sooner, thereby driving down prices for auto repairs, they say.
Passage by Congress “would protect consumers’ access to competitive replacement parts when repairing their cars after an accident,” according to a news release from the Quality Parts Coalition, which supports the act and represents the independent auto parts industry, repairers, insurers and consumers.
Opponents of the act contend it could stifle innovation in the auto industry and lead to lower quality auto repairs, exposing consumers to safety, performance or durability risks.
Felder, who testified on behalf of the coalition and the Auto Body Parts Association, spoke in support of the act and about her concerns.
“Some car companies appear to have created a business strategy to eliminate competition and expand their already dominant share of the market by obtaining 14-year design patents on their collision parts and enforcing them against alternative suppliers,” Felder is quoted as saying at the hearing.
The act, which has been debated since as early as 2012, was formally reintroduced last February by U.S. Reps. Darrell Issa, R-CA, and Zoe Lofgren, D-CA. U.S. Sens. Orrin Hatch, R-UT, and Sheldon Whitehouse, D-RI, have introduced the act in the Senate.
