Over the past two years, a number of legislative proposals have been proposed to address the perceived problem of “patent trolls.” A common problem of the proposed reform mechanisms is that they would result in broad reforms against all patent owners rather than specifically targeting problematic elements. For those with general anti-patent bent, that result may be acceptable. However, the pro-patent lobby remains strong enough to ensure that congressional reforms will not completely eviscerate the system. In his guest post below, Mr. Shah outlines his proposal for reforms that more selectively target patent trolls. – Dennis
Guest Post by Varun A. Shah, Head of IP Development for Aruba Networks.
The Innovation Act was a great attempt at solving the patent troll problem for the Information Technology industry. For example, the Innovation Act proposed heightened pleading standards for asserting patent infringement. However, the Innovation Act is now stalled in Congress, in part, due to the rejection by the Pharmaceutical and Biotech industries of new requirements for enforcing patents such as the heightened pleading standards. A solution is needed that solves the patent troll problem for the Information Technology industry without reducing the patent assertion rights of the original patent Applicant, i.e., the innovator.
I propose modifying the Innovation Act to require heightened pleading standards only if the current patent owner is not (a) the original Applicant or (b) an assignee that the Applicant is obligated to assign to at time of filing. In other words, only third parties (e.g., patent trolls or middle men) that acquire the patent would be required to follow the heightened pleading standards for asserting patents. Similarly, other patent rights, damages, and requirements for patents would depend on whether or not the current patent owner is (a) the original Applicant /an assignee that the original Applicant is obligated to assign to at time of filing or (b) a third party that acquired the patent. In case of legitimate business spin-offs (that are not primarily a patent sale), the business spin-off or acquiring company would hold the same rights as the original Applicant, and would not be subject to heightened pleading requirements for asserting patents.
This proposal reduces the patent troll problem for the Information Technology industry without reducing the patent assertion rights for the original patent Applicant. More generally, this proposal will protect the interests of all innovators that actually generate the ideas/patents while partially diluting the value of the patents if commoditized and transferred to others that are abusing and burdening the patent system. This re-structuring of patent value is in-line with the true goals of the patent system, i.e., the promotion of innovation.
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Mr. Shah suggests that those who care about these ideas should contact the policymakers: Senator Leahy, Representative Goodlatte, and the White House Office of Science and Technology Policy (OSTP).