The bipartisan Innovation Act is the best bill yet when it comes to fighting patent trolls. This post is the first of a series explaining the bill's various provisions. While the Innovation Act won't fix every problem with the patent system, it includes a powerful set of proposed reforms that—taken together—will significantly reduce the threat of abusive patent trolls.
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Under current law, patent owners can file bare-bones complaints. This means that trolls can—and often do—file suits without specifying what products they think infringe their patents or even which patent claims they are asserting. This leaves defendants guessing what the case is actually about. The basic details of the plaintiff's infringement allegations—assuming it can even articulate some—won't emerge until after expensive discovery. Rather than pay a fortune in legal fees to reach that stage, many defendants simply settle.
The Innovation Act fixes this problem by requiring plaintiffs, at the outset, to provide the basic details of their case. It requires that pleadings include: "each patent," "each claim" and, for each such claim, the products or services of the defendant that allegedly infringe. The patent owner must also allege "with detailed specificity" how the accused products allegedly infringe. (If any of this information is not accessible, the plaintiff can instead explain its efforts to uncover the information.)
Although many have been calling this a "heightened pleading" requirement, it is really no more than a sensible pleading requirement: what patent, what claims, what products, and how infringed. This should not be a burden for anyone with a legitimate case. Patent owners who can't provide these basic and simple details should not be dragging defendants into federal court in the first place.
For an illustration of the importance of heightened pleading, consider the case of Fark. As Drew Curtis explains in this TED talk, Fark Inc., along with many other Internet news companies, was sued by a patent troll in 2011. The troll owned a silly patent on emailing news releases (i.e. press releases)—something none of the defendants actually did. Despite the absurdity of the case, most of the defendants settled early to avoid expensive litigation. But Fark refused to pay. Finally, after months of litigation, the troll was required to provide an explanation (in the form of screen shots) showing how Fark.com supposedly infringed the patent. Since this was impossible, it promptly conceded defeat and withdrew its case. With heightened pleading, this case would likely never have been filed.
The Innovation Act's heightened pleading requirement will make it far more difficult for bottom-feeder patent trolls to launch nuisance suits. Together with the Innovation Act's other reforms, it will make life safer for the small innovators and creators.
Posts in this series