Congress Continues Efforts to "Reform" U.S. Patent Law

By Donald Zuhn --

It has been less than three months since the remaining provisions of the Leahy-Smith America Invents Act (AIA) took effect, and just short of five months since the AIA Technical Corrections Act was enacted to "correct and improve certain provisions" of that legislation.  Nevertheless, Congress is once again looking to further reform (or tweak) U.S. patent law, with three patent-related bills and a discussion draft for a fourth bill having been introduced or released in the past four weeks.

On May 16, the first of the three new patent bills was introduced in the House by Rep. Theodore Deutch (D-FL).  The "End Anonymous Patents Act" (H.R. 2024) would require the disclosure of ownership and transfers of ownership of patents.  In particular, the Act would require:

(1) The entity to which a patent is issued shall, upon issuance of the patent, file with the USPTO a disclosure of the patent owner and any real party in interest in the patent.

(2) The owner of a patent shall, upon payment of the maintenance fee, file with the USPTO a disclosure of the identity of the patent owner and any real party in interest in the patent.

(3) The entity to which a patent, application, or interest therein is sold, granted, or conveyed shall, within 90 days after the date of the sale, grant, or conveyance, file with the USPTO a disclosure of the sale, grant, or conveyance, and any real party in interest in the patent, application, or interest.

H.R. 2024 specifies that the failure to comply with the above requirements will result in the patent owner or real party in interest being limited to "damages from the date on which such requirement is met" in any infringement action brought by the patent owner or real party in interest.  After being introduced, H.R. 2024 was referred to the House Committee on the Judiciary.

On May 22, Sen. John Cornyn (R-TX) introduced the "Patent Abuse Reduction Act of 2013" (S. 1013) in the Senate.  S. 1013 would add procedural requirements for patent infringement suits to Title 35.  In addition to requiring a party alleging infringement to include in its complaint, counterclaim, or cross-claim an identification of each patent, and each claim of each patent, allegedly infringed, as well as a specific identification of each accused instrumentality alleged to infringe the claim, the party alleging infringement would also be required to provide "a description of the principal business of the party alleging infringement" and to identify co-owners, assignees, and exclusive licensees of the asserted patent.  S. 1013 would also limit discovery prior to claim construction "to information necessary for the court to determine the meaning of the terms used in the patent claim, including any interpretation of those terms used to support the claim of infringement."  After being introduced, S. 1013 was referred to the Senate Committee on the Judiciary.

On June 4, Rep. Steve Chabot (R-OH) introduced the "Promoting Startup Innovation Act" (H.R. 2236) in the House.  The bill, which was co-sponsored by Rep. Jason Chaffetz (R-UT), Judy Chu (D-CA), Howard Coble (R-NC), Anna Eshoo (D-CA), Blake Farenthold (R-TX), and Zoe Lofgren (D-CA), would modify the definition of micro entity in Title 35.  In particular, the legislation would:

(A) Increase from 4 to 7 the number of previously filed patent applications (excluding foreign applications, provisional applications, or international applications for which the basic national fee under was not paid) on which the applicant as been named as an inventor.

(B) Increase from 3 times to 5 times the amount by which an applicant's gross income exceeds the median household income for the preceding calendar year.

(C) Increase from 3 times to 5 times the amount by which the gross income of an entity having an ownership interest in the application exceeds the median household income for the preceding calendar year.

H.R. 2236 would also require the Director to approve or deny any application for status as a micro entity not later than 45 days after the date on which the application is filed.  After being introduced, H.R. 2236 was referred to the House Committee on the Judiciary.

In addition to the three bills discussed above, Rep. Bob Goodlatte (R-VA), the Chairman of the House Committee on the Judiciary, announced the release on May 23 of a discussion draft of legislation "designed to address the ever increasing problem of abusive patent litigation."  According to Chairman Goodlatte, the discussion draft "helps to address the issues that businesses of all sizes and industries face from patent troll-type behavior and aims to correct the current asymmetries surrounding abusive patent litigation" and marks "the first step in enacting meaningful legislation that reduces the costs of frivolous litigation, increases patent certainty and promotes the creation of American jobs."  A summary of the draft legislation can be found here.  Patent Docs will provide more information regarding the bill once the legislation, or its Senate companion, is introduced.

For additional information regarding this and other related topics, please see:

• "USPTO Issues Rules to Implement AIA Technical Corrections," April 3, 2013

Comments

[Mmm]

I like S. 1013. I like it a lot. There are parts (like the indirect infringement part) that need some fixing. But the core tenants of it are great:

1. More stringent pleading requirements
2. Identification of all parties of interest
3. Limits on discovery until after claim construction (!)
4. Fee shifting (shall award fees unless “position or conduct of the non-prevailing party were objectively reasonably and substantially justified”)

[6]

Huzzah! Congress speaketh soon!!!???!@?!?!