The White House today announced that it was actively taking on the patent troll problem. Besides seven legislative proposals the White House recommended, there are five executive actions the U.S. President intends to take with or without congressional help.
The patent reform is aimed at cracking down on companies that make money by suing other firms over patents, especially in the tech sector.
The Administration recommends that the U.S. Congress pursue at least seven legislative measures that would have immediate effect on some major problems innovators face:
- Increase demand letter transparency: incentivizing public filing of demand letters in a way that makes them accessible and searchable to the public. Access to this information gives troll targets increased ability to fight back while removing much of the dangerous secrecy that the trolls currently operate behind.
- Fix transparency: requiring patent owners to update records at the Patent Office as to a patent's real owner whenever they assert that patent, even if the threat is in the form of a demand letter. Again, taking away secrecy takes away one of the patent troll's favorite weapons.
- Expand fee-shifting: making it easier for courts to make losers pay when they bring frivolous law suits.
- Expand review of business method patents: increasing the scope and duration of a program that allows robust patent challenges at the patent office.
- Protect end users: ending the abuse associated with targeting end users, such as small businesses, startups, and even individuals who find themselves facing lawsuit threats and licensing demands for simply using everyday products by giving those end users legal tools to slow down or even stay litigation.
- Change International Trade Commission (ITC) standard for injunctive relief: making it harder for parties to keep whole products out of the U.S. market based on claims of infringement, particularly when that infringement only covers a fraction of a whole product or when removal from the market would not be in the consumers' best interest.
- Ensure the ITC has adequate flexibility in hiring qualified Administrative Law Judges.
President Obama also announced a number of steps taken to help bring about greater transparency to the patent system. Those steps include:
- Tighten functional claiming: requiring patent applicants to explain their inventions better and to limit those inventions to a specific way of accomplishing a task, as opposed all ways of accomplishing a task.
- Fix transparency: requiring patent owners to update records at the Patent Office with the patent's real owner. Taking away secrecy takes away one of the patent troll's favorite weapons.
- Empower downstream users: ending the abuse associated with targeting end users, such as small businesses, startups, and even individuals who find themselves facing lawsuit threats and licensing demands for simply using everyday products. As the White House puts it: "End-users should not be subject to lawsuits for simply using a product as intended, and need an easier way to know their rights before entering into costly litigation or settlement."
- Expand dedicated outreach and study: working with members of the community, including third-party stakeholders, to address flaws in the system. This would include increasing scholarly programs at the Patent Office, something that if done right could have a direct positive effect on patent quality by bringing in big thinkers to address systemic problems at that office.
- Strengthen enforcement of exclusion orders: streamlining procedures for imported goods that are found to infringe U.S. patents.