Prospects Good for Patent Litigation Bill to Pass Congress by End of 2014, Pro-Revamp Lawmakers Say
Legislation that seeks to curb patent litigation abuse has a good chance of passing both chambers before the end of the year, two top patent revamp advocates in Congress said Wednesday. “It’s a pretty good bet you could see something on this, this year,” said Sen. Mike Lee, R-Utah, at a Politico event sponsored by the pro-revamp Main Street Patent Coalition. Lee and Senate Judiciary Committee Chairman Patrick Leahy, D-Vt., are the main sponsors of the Patent Transparency and Improvements Act (S-1720), the Senate’s marquee bill addressing patent litigation. The House has already passed the Innovation Act (HR-3309), its own patent litigation revamp measure, but the two bills are not completely similar.
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Senate Judiciary could mark up S-1720 before Congress begins its mid-April recess, an industry source told us. Leahy said in a statement that he plans to “list bipartisan legislation for consideration later this month.” A committee spokeswoman would not confirm the exact timeline of an S-1720 markup or whether the committee plans to hold any additional hearings on the bill. A committee markup would follow months of behind-the-scenes work to collect stakeholders’ input on the bill (CED Feb 12 p3).
Senate Judiciary is hoping to incorporate language from other patent litigation bills into a bipartisan compromise, most notably provisions from the Patent Abuse Reduction Act (S-1013), Lee said Wednesday. A compromise S-1720 could more closely resemble HR-3309 than its original iteration, he said. S-1013, sponsored by Sen. Jon Cornyn, R-Texas, includes language addressing a revamp of court rules related to patent litigation, including language that would expand a judge’s discretion to allow fee-shifting. A fee-shifting provision will be crucial to getting Republican support for a final bill, Lee said. It’s less certain whether S-1720 will include a provision expanding the Patent and Trademark Office’s (PTO) covered business method (CBM) patent review program, he said. The America Invents Act created the CBM program in 2011, and Lee said he would like the program to wait until the program has been in effect for a longer period “before we expand it."
Meanwhile, the Senate Commerce Committee has temporarily delayed its consideration of the Transparency in Assertion of Patents Act (S-2049). The committee said Tuesday night it would be moving a planned markup of S-2049 and seven other bills from Wednesday to March 12. The meeting is set to begin at 2:30 p.m. in 253 Russell. Senate Commerce had appeared to be fast-tracking its consideration of S-2049 last week, announcing the markup days after Sen. Claire McCaskill, D-Mo., introduced the bill. S-2049 remains so new that it’s still not clear how much support it has among members of Senate Judiciary, industry stakeholders told us. But “I'd have to assume that [McCaskill] feels she’s got that support or she wouldn’t have gone to markup so quickly,” said Matt Levy, Computer & Communications Industry Association patent counsel.
S-2049 is “yet another approach” to dealing with pre-litigation demand letters, Lee said. S-1720 also includes language addressing demand letters, as does HR-3309. Rep. Jared Polis, D-Colo., who backed HR-3309, said he is continuing to push for House passage of the Demand Letter Transparency Act (HR-3540). That bill would require most entities that send out pre-litigation demand letters to submit detailed information to the Patent and Trademark Office if they send a specific number of demand letters during a 365-day period. HR-3309 ultimately included some language addressing demand letters, but Polis said he believes the House needs to pass more detailed language on that aspect of patent litigation. The demand-letter language in S-1720 is “simpler” than what’s included in HR-3540, but it does not represent “substantial differences,” Polis said.
Congress must ensure a final conference bill on patent litigation “is a substantial bill that actually deals with patent trolls,” Polis said, cautioning against the Senate passing a bill simply for the sake of passing a bill. A final bill must address “the need to make money off patents,” said Benjamin Berman, deputy general counsel of travel search engine Kayak, calling patent assertion entities (PAEs) “today’s Mafia."
Critics of provisions in some of Capitol Hill’s patent revamp bills said Wednesday that lawmakers should refocus the legislation. Intellectual Ventures, a PAE, believes any changes “should be narrowly tailored” and should focus on “the most egregious issues,” said Russ Merbeth, chief policy counsel. Legislation that is too broad would “cripple” patent research at U.S. universities, said John Vaughn, Association of American Universities executive vice president. “We will pay a heavy price.”