Patent Reform

Patent Reform

August 25, 2015

 

The Honorable Earl Blumenauer

United States House of Representatives

1111 Longworth House Office Building
Washington, DC 20515

 

Dear Congressman Blumenauer:

 

On behalf of the Stayton Sublimity Chamber of Commerce, I want to ask you to support the Innovation Act of 2015 (H.R. 9), which targets abuses by so-called patent trolls by calling for a vote on this bill as soon as possible. Abusive patent litigation is a problem that only continues to grow – in 2013, patent troll litigation reached a record high, up 13 percent over 2012 and more than a tenfold increase over the past decade. Lawsuits brought by patent trolls were up nearly 42 percent in the first quarter of 2015 over the previous quarter.

 

While there is a perception that patent trolls mainly target tech companies, the truth is that they target a broad range of American businesses: large and small, tech and main street. In fact, since 2012, patent trolls have sued more non-tech Main Street companies than tech companies. Employers including realtors, homebuilders, restaurants, convenience stores, truckers, hoteliers and grocers have all faced the threat of expensive litigation from patent trolls.

 

The core of the problem is that patent trolls often purchase patents that are near expiration and attempt to expand the reach of the issued patent far beyond their original scope. Companies have been sued for having drop down menus, shopping cart features, or store locators on their websites. Many of these patents date back to the 1980’s and 1990’s and have had multiple owners with minimal or no continuing involvement of the actual inventor. Currently, there is little downside to the patent trolls filing a lawsuit and that is why this legislation is so important.

 

The Innovation Act is a strong step forward that will protect businesses large and small from frivolous patent lawsuits that are a drain on industry and a tax on innovation. The bill includes a number of key reforms that will close the loopholes that allow patent trolls to thrive. If passed, the proposed bill would make it so that patent infringement lawsuits could only be brought in judicial districts where either party has an established presence – an important element, as patent trolls are known to seek out judicial districts where they feel they have a higher likelihood of success. It would protect innocent customers by ensuring claims between a patent owner and a manufacturer proceed before claims between the patent owner and the manufacturer’s end users. The bill would further instruct the courts to develop rules and procedures to reign in the out of control discovery costs that patent trolls use to force unwarranted settlements from innocent defendants. It would also require that a losing party who brings a frivolous case pay the other side’s attorneys’ fees. Finally, in accordance with Chairman Goodlatte’s statements during markup, we would hope that it would include a pleadings section that requires plaintiffs to plead each claim of those patents that they say is infringed.

 

Taken together, these reforms would have a significant positive impact on businesses. Abuses by patent trolls have created a climate of fear that discourages risk taking and expanded economic growth. Please support the Innovation Act, which will protect businesses and foster innovation in Oregon. We hope you will encourage our colleagues to come together in the call for a vote immediately following the August recess.

 

Sincerely,

Kelly Schreiber

Kelly Schreiber

Executive Director

 

CC:

 

The Honorable Speaker John A. Boehner

The Honorable Majority Leader Kevin McCarthy

The Honorable Majority Whip Steve Scalise

The Honorable Chairman of the House Committee on the Judiciary Bob Goodlatte

The Honorable Suzanne Bonamici

The Honorable Peter DeFazio

The Honorable Kurt Schrader

The Honorable Greg Walden