Recently, Senator Christopher Coons (D-Del) and a bipartisan group of other senators introduced the STRONGER Patents Act of 2017. The STRONGER Patents Act of 2017 is the first piece of general patent-related legislation introduced in the 115th Congress. It is designed to make post-issuance proceedings before the PTAB more fair and efficient, and to address emerging concerns about these proceedings and the continual weakening of patent rights by the courts.
This new bill would overturn the Supreme Court cases of eBay (by restoring the presumption for injunctive relief), Akamai (by eliminating the single entity rule for direct infringement), Global-Tech (by loosening the specific intent requirement for inducement), and Cuozzo (by allowing interlocutory appeal of PTAB institution decisions and requiring that the U.S. Patent and Trademark Office (PTAB) use the same claim construction standard as district courts), place limits on the use of Inter Partes Review and other post-grant proceedings; crack down on abusive demand letters by incorporating the provisions of the previously-introduced TROL Act and; prevent the diversion of patent application fees from the U.S. Patent and Trademark Office to other government programs
Ropes & Gray Intellectual Property Litigation Counsel Matthew Rizzolo recently sat down with Inside Counsel to discuss potential impact of the STRONGER Patents Act of 2017 bill. According to him, certain provisions of the Act would make it more difficult to challenge a patent in front of the PTAB and would harmonize between the district court and the PTAB the standards for evaluating patent validity, per Rizzolo.
“The Act would also overturn several recent Supreme Court decisions by re-establishing the presumption of injunctive relief upon a finding of infringement, relaxing the standards for proving inducement and other indirect infringement, and providing for infringement liability related to the outsourcing of manufacturing overseas,” he explained.
There are some limits on the use of Inter Partes Review that this bill will cause. According to Rizzolo, it is unlikely that the bill will be enacted into law in its current form. That said, the provisions of the STRONGER Patents Act would impose significant limitations on the use of IPRs and would disincentivize the use of these proceedings in several ways.
First, the Act would harmonize the way validity is addressed between the PTAB and district courts. It would raise the burden of proof on invalidity in an IPR to the clear and convincing standard – the same standard applied in district court – from the current preponderance of the evidence standard, and would require that the PTAB construe claim terms using the same standard as the district court. The bill would also prohibit petitioners from filing an IPR petition unless the petitioner was sued or charged with infringement by the patent owner. And, if a district court addresses the validity of a patent before the PTAB does so, the bill provides for either staying or dismissing the IPR pending appeal of the district court or ITC determination.
The bill would allow each claim of patent to be challenged in only one IPR, and would limit petitioners to file only a single challenge per patent. It would also afford patent owners a concrete opportunity to amend their claims after a petition is filed, would give patent owners the ability to seek immediate Federal Circuit review of the PTAB’s decision to institute an IPR, and would allow patent owners to readily seek discovery into the real party in interest behind a PTAB filing, and more.
So, how will this new bill crack down on abusive demand letters?
“The bill incorporates provisions of the Targeting Rogue and Opaque Letters (TROL) Act of 2015. It expressly authorizes the Federal Trade Commission and state attorneys general to sue in federal court against the senders of infringement demand letters that may contain misleading or inaccurate information,” Rizzolo said. “However, the act does not create an individual cause of action by which targets of those letters may bring suit.”