Transparency in Assertion of Patents Act: S.2049

Senators McCaskill and Rockfeller introduced the Transparency in Assertion of Patents Act: S.2049 on February 26, 2014. The proposed legislation provides instruction for the FTC related to patent demand letter disclosures, unfair or deceptive patent assertions and civil penalties for unfair or deceptive patent demand letters.

A summary of S.2049, The Transparency in Assertion of Patents Act, is provided here for download (PDF).

White House Announces New Patent Executive Actions

The White House announced three new executive actions to encourage innovation and further strengthen the quality and accessibility of the patent system:

 

• Crowdsourcing Prior Art — To help ensure that U.S. patents are of the highest quality, the USPTO is announcing a new initiative focused on expanding ways for companies, experts, and the general public to help patent examiners, holders, and applicants find relevant “prior art”—that is, the technical information patent examiners need to make a determination of whether an invention is truly novel.
  
• More Robust Technical Training — The USPTO is expanding its Patent Examiner Technical Training Program to help patent examiners keep up with fast-changing technological fields by making it easier for technologists, engineers, and other experts to provide relevant technical training and guidance to patent examiners. To make the most of these changes, the Administration is calling on innovators to volunteer their time and expertise to help ensure that USPTO training is robust and reflects the state of the art.
  
• Pro Bono and Pro Se Assistance — To increase the accessibility of the patent system, the USPTO will dedicate educational and practical resources to assist inventors who lack legal representation, appoint a full-time Pro Bono Coordinator, and help expand the existing America Invents Act pro bono program to cover all 50 states.

The White House announcement fact sheet addition details are provided via the link here (PDF).

Patent Reform Legislative Proposals

Patent reform is a hot issue in Washington DC right now. In fact there are currently nine different patent reform legislative proposals under consideration by Congress.

The SPAN (Stop Patent Abuse Now) coalition has been proactive in representing the views of the marketing industry and advocating the need for patent reform particularly related to evasive demand letters. In order to help you understand the range of pending patent reform legislation, Venable LLP has developed a side-by-side comparison of the proposed patent bills (see attached worksheet/link). The Venable worksheet summarizes the key aspects of the pending proposals including: Invalidation of overly broad patents, demand letter regulation, pleading requirements, transparency, fee-shifting and bonding proposals, etc. 

The Venable LLP patent reform proposals worksheet, that is attached/linked here, summarizes nine patent reform proposals that are currently under consideration:

S.1612;	Patent Litigation Integrity Act;	Hatch, R-UT
S.1720;	Patent Transparency and Improvements Act;	Leahy, D-VT
H.R. 3309;	Innovation Act;	Goodlatte,R-VA
S.1013;	Patent Abuse Reduction Act	Cornyn, R-TX
S. 866;	Patent Quality Improvement Act;	Schumer, D-NY
H.R. 3540;	Demand Letter Transparency Act;	Polis, D-CO
H.R.2639;	Patent Litigation and Innovation Act;	Jeffries, D-NY
H.R. 2766;	Stopping Offensive Use of Patents Act;	Issa, R-CA;Chu D-CA
H.R. 2024;	End Anonymous Patents Act;	Deutch,D-FL

The 4A's will continue to monitor patent reform initiatives and advise as legislation moves forward.

PAE Demand Letter Reform

Twenty one associations led by the 4A's and the industry's SPAN coalition urge Congress to include provisions to address unfair and deceptive patent infringement demand letters.

A consortium of trade associations and public interest organizations applaud bipartisan efforts in Congress to curb abusive patent litigation and strongly urge congressional leaders
to address unfair and deceptive patent infringement demand letters.

The associations communication to congressional leaders notes that "Demand letters are central to the patent troll problem." The coalition members
"urge Congress to enact meaningful legislative solutions to protect businesses of all sizes from these “smash and grab” tactics".

The link to the coalition PAE demand letter reform request is provided here (PDF).

U.S. Government Accountability Office (GAO) report to Congressional Committees...

Intellectual Property: Asessing Factors That Affect Patent Infringement Litigation Could Help Improve Patent Quality

Why The GAO Developed this Report: Legal commentators, technology companies, Congress, and others have raised questions about patent infringement lawsuits by entities that own patents but do not make products. Such entities may include universities licensing patents developed by university research, companies focused on licensing patents they developed, or companies that buy patents from others for the purposes of asserting the patents for profit.

 

Section 34 of AIA mandated that GAO conduct a study on the consequences of patent litigation by NPEs. This report examines (1) the volume and characteristics of recent patent litigation activity; (2) views of stakeholders knowledgeable in patent litigation on key factors that have contributed to recent patent litigation; (3) what developments in the judicial system may affect patent litigation; and (4) what actions, if any, PTO has recently taken that may affect patent litigation in the future. GAO reviewed relevant laws, analyzed patent infringement litigation data from 2000 to 2011, and interviewed officials from PTO and knowledgeable stakeholders, including representatives of companies involved in patent litigation.

 

The “Conclusion” and “Recommendation for Executive Branch Action” from the GAO Report are provided below:

 

Conclusion:  Public discussion surrounding patent infringement litigation often focuses on the increasing role of NPEs. However, our analysis indicates that regardless of the type of litigant, lawsuits involving software-related patents accounted for about 89 percent of the increase in defendants between 2007 and 2011, and most of the suits brought by PMEs involved software-related patents. This suggests that the focus on the identity of the litigant—rather than the type of patent—may be misplaced. PTO’s recent efforts to work with the software industry to more uniformly define software terminology and make it easier to identify relevant patents and patent owners may strengthen the U.S. patent system. Further, PTO has available internal data on the patent examination process that could be linked to litigation data, and a 2003 National Academies study reported that using these types of data together could provide useful insights into patent quality. Examining the types of patents and issues in dispute represents a potentially valuable opportunity to improve the quality of issued patents and the patent examination process and to further strengthen the U.S. patent system.

 

Recommendation for Executive Branch Action:  We are recommending that the Secretary of Commerce direct the Director of PTO to consider examining trends in patent infringement litigation, including the types of patents and issues in dispute, and to consider linking this information to internal data on patent examination to improve the quality of issued patents and the patent examination process.

 

The link to the GAO report is provide here: http://www.gao.gov/products/GAO-13-465