Yesterday, the House of Representatives passed the Innovation Act, H.R. 3309, by a vote of 325-91. The bill now heads to the Senate where a similar bill, the Patent Transparency and Improvements Act, S. 1720, is currently pending.
Prior to passage by the House, several amendments were made to H.R. 3309.
The use of demand letters or notice to potential infringers has often been used to later establish claims of willful infringement. Once the potential infringer is put on notice of the patent, continued infringement is alleged to be willful. One amendment seeks to provide significantly greater requirements for such letters. A claimant seeking to establish willful infringement may not rely on evidence of pre-suit notification of infringement unless that notification identifies with particularity the asserted patent, identifies the product or process accused, identifies the ultimate parent entity of the claimant, and explains with particularity, to the extent possible following a reasonable investigation or inquiry, how the product or process infringes one or more claims of the patent.
The requirement to identify the “ultimate parent entity of the claimant” was added.
The provision to repeal 35 U.S.C. § 145 was deleted. Section 145 permits applicants who are dissatisfied with a final PTO decision on the merits of a patent application to sue the PTO in district court to obtain the patent. This section has nothing to do with patent trolls and should be taken up and debated in a separate bill.
A requirement for an economic study of the impact of the legislation on individuals and small businesses owned by women, veterans and minorities was also added.
Not surprisingly, this legislation is controversial. Industry groups are lining up for and against the legislation. One specific problem is that the PTO has not weighed in. This is also not surprising given that the agency has been leaderless since David Kappos stepped down in January. Acting Director Teresa Stanek Rea has also left the PTO last month. Kappos testified against passage of the bill, but seems to carry much less weight since leaving the Office.
The PTO no longer has a Director or a Deputy Director. What is the Administration waiting for to nominate new leaders for these positions? Margaret (Peggy) Focarino has been delegated to undertake the leadership positions that have been vacated.