Protecting American Talent and Entrepreneurship (PATENT) Act

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S.1137: Protecting American Talent and Entrepreneurship (PATENT) Act (2015) (Congress)

The PATENT Act was introduced on April 29, 2015 by Senator Chuck Grassley (R-IA) and referred to the Senate Committee on the Judiciary. On September 8, 2015, the bill was placed on the Senate Legislative Calendar under General Orders. Currently the bill has 6 cosponsors (3 Republicans and 3 Democrats). The full title of the bill is "A bill to amend title 35, United States Code, and the Leahy-Smith America Invents Act to make improvements and technical corrections, and for other purposes."

GovTrack predicts the PATENT Act has a 36% chance of being enacted.

The House Innovation Act and Senate Patent Act are very similar; both acts address abusive litigation through “increased transparency, more limited discovery, heightened pleading standards, and ‘loser pays’ fee shifting”. However, there has been a delay in the passing of the bills because of controversy surrounging the shifting of attorney fees. Fee shifting was originally suggested as a way to incentivize small firms and businesses that were being unfairly accused of patent infringement to bring the case to court, so that they would not have to pay their attorney fees. However, there have been arguments stating that fee shifting would actually increase the settlement rate of small businesses being accused of patent infringement, because they don’t want to take the risk of losing and paying for the winner’s attorneys’ fees, in addition to their own. (Bloomberg BNA)

Summary

Pleading and early disclosure

The PATENT Act requires patent owners to identify each claim of each patent allegedly infringed and which products or processes are infringing. If the details are not available, the patent owner must explain why.

Discovery limits

The PATENT Act requires a court to stay expensive discovery pending the resolution of preliminary motions, such as the dismissal of a case, a change of venue, of the severance of accused infringers.

Fees and recovery

The act provides that reasonable attorney fees will be awarded if the court finds that the non-prevailing party was not objectively reasonable. This prevents patent trolls from extorting their targets into settling for thousands of dollars rather than spending millions of dollars in legal battles.

Disclosure of patent ownership

requires patent holders to disclose to the PTO whenever there is an assignment of interest in the patent that results in a change of ultimate parent entity

Small business provisions

directs PTO to develop educational resources for businesses targeted by patent suits and to create a list of pending patent cases on its website