Tough times ahead for patent trolls in the US as Innovation Act is passed by House of Representatives

11.12.2013

On 5 December 2013, the US House of Representatives passed the Innovation Act (otherwise known as the Goodlatte Bill). The Act is widely considered to be, in part, an attempt to curb the practices of “patent trolls”. Key provisions include:
• increased pleading requirements for patent infringement claims,
• limitations on the extent of discovery required at early stages in litigation, and
• powers for the Court to order that the loser pays the prevailing party’s costs.
The behaviour of patent trolls has been the subject of intense scrutiny in the US following the publication of a White House Paper in June 2013 that was critical of the impact that patent trolls were having on the US economy. In addition to the Innovation Act, the Senate are also currently considering another piece of draft legislation – the Patent Transparency and Improvements Act – which is also considered to be an attempt to curb the behaviour of patent trolls. Furthermore, the FTC has requested input on its proposal to scrutinise the practices of patent trolls by posing a number of questions to a selection of trolls concerning their structures and practices. The deadline for responses is 16 December 2013. For more on the FTC study, see here.
We can expect the political and legal scrutiny of troll activity to continue well into the New Year.