Senate committee to consider Leahy's patent reform bill

By Jessica M. Karmasek | Mar 18, 2014

WASHINGTON (Legal Newsline) -- One of the handful of patent reform bills introduced in Congress will be considered by the Senate Judiciary Committee later this month.

The bill, the Patent Transparency and Improvements Act, introduced by U.S. Sen. Patrick Leahy, D-Vt., in November, is scheduled to be heard by the committee March 27.

"America's patent system is the envy of the world and an engine for job creation," Leahy said Thursday.

"Members of the Senate Judiciary Committee have been working on meaningful, targeted legislation to combat patent abuses in our system. As chairman of the committee, I am committed to ensuring we move forward with meaningful legislation this spring."

Leahy's measure, also referred to as Senate Bill 1720, is considered by some to be a "less ambitious" version of the House's Innovation Act.

The Innovation Act, introduced by U.S. Rep. Bob Goodlatte, R-Va., was approved by the House in an overwhelming bipartisan vote of 325-91 in December and has since been sent to the Senate, where lawmakers are carefully considering it.

Similar to the Innovation Act, Leahy's bill would increase transparency in patent ownership.

In particular, the person or organization that holds the patent and files an action in federal court would have to disclose any and all persons that have a financial interest in the proceedings, or that could be affected by the outcome.

And like the Innovation Act, Leahy's measure targets the widespread sending of frivolous demand letters.

More specifically, the Senate bill would empower the Federal Trade Commission to consider such letters an "unfair and deceptive act or practice."

S. 1720 also allows cases against customers who are sued for patent infringement to be stayed while the manufacturer litigates the lawsuit.

Leahy's bill also would provide additional resources for small business that are targeted in patent infringement lawsuits, and it calls for various studies to be done by the U.S. Patent and Trademark Office, among others.

U.S. Sen. Claire McCaskill, D-Mo., also introduced legislation, the Transparency in Assertion of Patents Act, earlier this month.

Her bill would empower the FTC by requiring minimum disclosures in letters sent by so-called "patent trolls" to businesses that allege patent violations and make various demands -- often referred to as "demand letters."

McCaskill's legislation also would allow the FTC to specify for businesses exactly what constitutes a deceptive demand letter.

From Legal Newsline: Reach Jessica Karmasek by email at patents@legalnewsline.com.

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