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Chairman Goodlatte Discusses Abusive Patent Litigation at Policy Forum


Location: Washington, DC

Today House Judiciary Committee Chairman Bob Goodlatte (R-Va.) delivered the following remarks on the issue of abusive patent litigation at the Software & Information Industry Association's (SIIA) Tech Policy Speaker's Series. Below are his remarks as delivered:

Chairman Goodlatte: "I want to thank the Software & Information Industry Association (SIIA) for hosting this Tech Policy Speaker's Series and all of you for being here today to discuss the issue of abusive patent litigation.

During the last Congress we passed the America Invents Act (AIA). That bill was the most significant reform to the patent system in my lifetime. The AIA modernizes our patent system and sets it on the right path for decades to come.

The AIA included a number of provisions that went directly to addressing the issues surrounding patent quality. The PTO has new programs in place to ensure higher quality patents that can stand up to review, setting the bar higher so that quality control starts on the front end rather than relying on the federal courts system to fix problems.

The U.S. patent system is designed to be fair, meeting our international obligations and not discriminating against any field of technology. The strength of the U.S. system relies on the granting of strong patents, ones that are truly novel and non-obvious inventions, those that are true innovations and not the product of legal gamesmanship.

An example of a positive retrospective provision from the AIA, is the special post-grant program to correct the egregious errors made in the granting of a wide range of business method patents. This program provides the PTO with a fast, precise vehicle to review low-quality business method patents, which the Supreme Court has acknowledged are often abstract and overly broad. This program is an integral component in making our patent system stronger and better. And we will continue working to make necessary improvements to ensure that the program lives up to its legislative intent.

While the AIA paved the way for higher quality patents on the front end, there were several issues that were left on the cutting room floor during the last Congress that could help go more directly to the immediate issues surrounding patent trolls and abusive patent litigation. But it is important to clarify for purposes of our discussion that the term patent troll should be treated as an adjective or descriptor for a type of behavior, and not as a noun defining a specific business model or entity.

Abusive patent litigation is a drag on our economy. Everyone from independent inventors, to start-ups, to mid and large sized businesses face this constant threat. The tens of billions of dollars spent on settlements and litigation expenses associated with abusive patent suits represent truly wasted capital -- wasted capital that could have been used to create new jobs, fund R&D, and create new innovations and technologies.

Abusive patent troll litigation strikes at the very heart of American innovation and jobs. That is why Congress, the Federal Courts and the PTO will continue to take the necessary steps to ensure that the U.S. patent system continues to be one that lives up to the vision of our Founders, truly promoting the progress of science and the useful arts.

The patent system was never intended to be a playground for trial lawyers and frivolous claims. That is why we have put forward a bicameral patent discussion draft that lays out key reforms to discourage frivolous patent litigation and ensure that our U.S. patent laws are kept up to date.
On May 23, I -- in consultation with Senate Judiciary Committee Chairman Pat Leahy -- released a patent discussion draft that helps to address the issues that businesses of all sizes and industries face from patent-troll type behavior and aims to correct the current asymmetries surrounding abusive patent litigation.

We worked to strike a balanced approach with our discussion draft, focusing on abusive patent litigation behavior rather than specific entities. The bill contains provisions that deal with the Federal Courts and the USPTO, and the bill makes improvements and other technical corrections to the America Invents Act (AIA).

The bill includes provisions to incentivize settlement in patent litigation in appropriate cases, reduce protracted litigation in general, and deter frivolous cases. The bill also provides for several recommendations to the Judicial Conference, dealing with discovery burdens, case management procedures, and patent infringement filings.

The bill also protects downstream customers and end users through a customer suit stay provision. This allows a manufacturer of an allegedly infringing product to intervene and stay cases against downstream customers, who are usually not in the best position to defend against an infringement suit.

We have also required greater transparency in patent assertions, tied to both demand letters and litigation. That information will be easily accessible on the PTO website for the public. Also the PTO will be required to develop educational and informational resources for small businesses concerning abusive patent litigation.

Taken as a whole, the bill is designed to positively help reshape the current environment surrounding patent troll-type behavior and abusive patent litigation. Each of the sections work together to reduce the costs of frivolous litigation, increase patent certainty and in the end, promote job creation and innovation.

What we released is a discussion draft. As such, we look forward to continuing to hear from interested stakeholders from all sides as we work to refine the various provisions in the bill in advance of a legislative hearing and eventual formal introduction.

This bill represents a significant step forward toward helping address this growing problem and I look forward to working with all of you as we continue building momentum to enact meaningful legislation."

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