Abusive patent litigation costs American consumers and businesses billions of dollars each year. The RPX Corp., a provider of patent risk management services, estimates that patent trolls cost U.S. operating companies $12.2 billion in 2014 alone. In an effort to stop abusive patent litigation, Senator Grassley, along with Senators Patrick Leahy, John Cornyn and Chuck Schumer, introduced the bipartisan Protecting American Talent and Entrepreneurship Act (“PATENT Act”), the third major patent reform bill introduced this year. The PATENT Act is a surprisingly short bill (only fifty-five pages), yet it contains many provisions aimed at curbing abusive litigation. Such provisions range from clarifying pleading standards to providing certain end user protections.
The PATENT Act has both supporters and critics. Erick Anders, Vice President and Deputy General Counsel at Microsoft, for example, praised the PATENT Act stating it “avoids measures that would erode the value of patents and undermine incentives to innovation.” The Association of American University (AAU) similarly praised the PATENT Act as a “measured approach to addressing the abusive litigation practices of patent trolls while protecting the integrity of our patent system.” The Innovation Alliance, however, opposes the PATENT Act believing it would “cripple the ability of legitimate U.S. patent owners to protect their ideas from infringers, both in the United States and overseas.” Similarly, the Biotechnology Industry Organization, criticized the PATENT Act for failing to address other abuses of the patent system such as the abuse of the USPTO’s inter partes review (IPR) proceedings against patent owners.
For sure it will be interesting to follow the PATENT Act as it traverses the legislative process. Hopefully, the final product will be one that truly curbs abusive patent litigation while preserving legitimate patent holder’s rights. Anyone interested in the PATENT Act can find the bill, in its entirety, at http://www.judiciary.senate.gov/imo/media/doc/PATENT%20Act.pdf.