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12 June 2015Patents

House committee passes Innovation Act

The US House of Representatives Judiciary Committee has passed a bill aimed at tackling abusive patent litigation filed by non-practising entities (NPEs), just a week after the Senate passed a similar bill.

The Innovation Act, a bill sponsored by committee chairman Bob Goodlatte, found support among both Democrats and Republicans at the vote yesterday, June 11.

It passed by 24 votes to 8, but Goodlatte said further amendments to the bill are likely as it heads to the full House of Representatives.

Goodlatte, who introduced the bill in February this year, said: “At its core abusive patent litigation is a drag on our economy and stifles innovation. It is a problem that impacts businesses and industries of all types and the jobs of the people who work for them, from the tech sector to the hospitality industry.

“The Innovation Act takes the necessary steps to address abusive patent litigation, while protecting legitimate property rights.”

If the bill is approved, demand letters sent from all asserting parties would have to include “basic information” about the patent allegedly being infringed and the nature of the infringement.

According to a statement from the house, the bill aims to bring “greater transparency” and help prevent asserting parties from “unilaterally racking up extreme litigation costs in an attempt to force a dubious settlement”.

On June 4, the Senate Judiciary Committee passed the Protecting American Talent and Entrepreneurship Act (PATENT Act), which also aims to curb abusive patent litigation from NPEs.

The PATENT Act requires asserting parties to disclose details of the disputed patent and how it has been allegedly infringed. Further amendments are expected once it reaches the full Senate.

Both bills also contain measures that allow judges to order losing claimants to pay the litigation costs of the defendants.

Darrell Issa, chair of the house subcommittee and who voted in favour of the bill, said: “We increasingly see innovation stifled by patent trolls, who see our patent system not as a tool to spur inventiveness but as a club with which to bludgeon those who truly seek to innovate and grow our economy.”

But Neil Smith, partner at law firm Rimon, said he does not support the latest attempts to reform US patent laws.

He said: “I am concerned that the current rush in Congress to make it easier to further invalidate patents in many areas is scratching where it does not itch.

“Many of the decisions from the Supreme Court, and the statistics showing fewer demand letters and lawsuits, suggest that the need for many of the reforms proposed does not exist, and may in the end be overkill, or at least seriously wound an already-weakened patent system,” he added.

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6 February 2015   A US law maker re-introduced a bill aimed at reforming the US patent system to the House of Representatives yesterday, reviving a similar bid that broke down last year.