Leahy’s Patent Abuse Bill Anticipated to Be Similar to Innovation Act

Russ Merbeth, chief policy counsel to patent assertion entity Intellectual Ventures, said his meetings with Leahy’s staff in recent months led him to believe the Leahy bill will be “complementary” to the Innovation Act, but “will not necessarily cover exactly the same things” Goodlatte’s bill covers. “There may be a few different things Leahy will try to deal with,” but many of the Innovation Act’s provisions are likely to reappear at least in spirit, such as a provision to stay a patent lawsuit against a product’s end-user in some circumstances while a corresponding lawsuit against the product’s manufacturer proceeds, Merbeth said. “Depending on the final language on that, we think there’s a reasonable chance we can support that.”

Patent experts from advocacy groups also see a strong likelihood of deep similarities between the Leahy bill and the Innovation Act. The Leahy bill is “likely to cover many of the same issues and there will be a lot of similarities, but it won’t be a complete overlap,” said Coalition for Patent Fairness Director Matt Tanielian. “It’s not a companion bill or a parallel bill.” Leahy’s staffers working on the issue are likely to be “looking closely at the reaction to Goodlatte’s bill” as they work on Leahy’s bill, said Julie Samuels, an Electronic Frontier Foundation staff attorney who has focused on patent litigation issues.

Industry reaction to the Innovation Act has been largely positive. But some intellectual property rights groups have raised concerns about some provisions in the bill, particularly the proposed expansion of the U.S. Patent and Trademark Office’s covered business method patent review program. BSA/The Software Alliance believes expansion of that program “risks undermining innovation by disrupting the patent system itself,” said Matt Reid, senior vice president-external affairs, in a statement. “We share [Goodlatte’s] desire to protect innocent customers, but we are concerned that proposed language to provide customer stays could inadvertently create loopholes that bad actors will use to game the system.” EFF is “interested to see where the debate on the business method patent program goes,” Samuels told us. “It’s true there’s been more pushback there, but that doesn’t mean it’s any less important or useful.”

Intellectual Ventures has seen what it considers continued improvement from a discussion draft of the Innovation Act released in September to the bill Goodlatte introduced, Merbeth said. “The issue for us has never really been about whether legislation harms Intellectual Ventures,” he said. “I think it’s been a question of whether it does more good things for the patent system generally than not. And I think the second draft was an improvement on first draft -- and the introduced bill is an improvement on that second draft."

Intellectual Ventures believes the Innovation Act requires some “fine-tuning,” and is fine with the bill’s concepts, said founder and vice chairman Peter Detkin. “We generally agree, for example, with the bill’s heightened pleading standards provision,” he said. “The implementation of that could use some tweaking -- otherwise we could find ourselves in a situation where we are making litigation even more inefficient because you end up with constant motions to dismiss on the basis of so many requirements. Even if you meet the spirit of the law, if you have all of these requirements, you end up with constant satellite litigation over whether or not you can claim these technicalities.”

Intellectual Ventures is not opposed to an overhaul of the patent system, and wants to ensure that any revamps focus on abuses of the system rather than specific types of patent owners, Detkin said during a Technology Policy Institute event. Matt Levy, Computer and Communications Industry Association patent counsel, said at Friday’s event that the Innovation Act will change patent litigation rules “for the better,” improving the situation in a way that will “help us get more innovation.”