November 4, 2013 | By Daniel Nazer

Six Good Things About the Innovation Act: Part Three, Ending Discovery Abuse

The bipartisan Innovation Act is the best bill yet when it comes to fighting patent trolls. This post is the third 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.

Join us in supporting the Innovation Act. Take action and contact your member of Congress now.

Ending Discovery Abuse

Patent trolls use the expense of litigation to pressure defendants to settle, even when the underlying claims are weak. One of the major pressure points is the extraordinary cost of discovery (especially the cost of locating, reviewing, and producing electronic documents like email messages). Patent trolls, who are often shell companies with few employees and documents, face a much lower discovery burden. The trolls know this. Some will even openly threaten to make litigation as expensive as possible in order extort a payment.

In recent testimony to Congress (PDF), the General Counsel of SAS explained that in just one patent case his company was required to produce over 10,000,000 documents at a cost of over $1,500,000. Of these millions of documents, only 0.000183% appeared on the plaintiff’s evidence list for use at trial. SAS ultimately won that case before trial on summary judgment. Yet it still had to bear the extraordinary discovery cost.

The Innovation Act deals with this problem in two ways. First, it delays most discovery until after the relevant patent claims have been interpreted by the court. (This is known as claim construction.) In many cases, claim construction quickly disposes of a case by establishing that the defendant does or does not infringe. Delaying most discovery until after this point will save many innocent defendants from huge and unnecessary expense.

Second, the Innovation Act limits discovery to "core documents." These are defined as those documents most likely to be relevant to the litigation (such as documents about how the accused products actually work). Plaintiffs that want additional discovery will have to pay for it themselves. This should stop patent trolls from using asymmetric discovery burdens as a litigation weapon. Taken together with the other reforms in the Innovation Act, this will make the patent troll business model much less attractive.

Ending discovery abuse is just one of the ways the Innovation Act stops patent trolls. Tell your members of Congress to support this much-needed reform.

Posts in this series:

Part One: Heightened Pleading

Part Two: Fee Shifting

Part Three: Ending Discovery Abuse

Part Four: Transparency

Part Five: Customer Suit Excpetion

Part Six: Covered Business Method Review


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