U.S. Parliament passes patent troll law

The “The Innovation Act of 2013” bill passed through the House of Representatives, the lower house of the US parliament. Both parties voted for him, with a total score of 325-91 . This unanimity is understandable: recently, stories about patent trolls trying to get a fee out of small business owners, hotels and restaurants have caused a great public outcry.

What is important, the parliament successfully blocked amendments to the bill , which tried to exclude critical points from it.

The most heated debate revolved around the amendment, which excludes from the bill the clause on the transfer of court fees on the principle of "loser pays." The fact is that the US Democratic Party has traditionally opposed such a principle, explaining its injustice in too small cases. Indeed, it is somehow strange to pay a fine of $ 100 and legal costs of $ 5,000. Therefore, the Democrats voted in favor of this amendment 174-18.

In the case of patent trolls, there is no question of any injustice, and the processes here are usually not limited to a hundred dollars. So you need to thank the Republicans who blocked the 25-195 amendment. The overall result of the adoption of this amendment is 199-213.

Another amendment tried to weaken another key point of the bill - the principle of delaying cases against technology users. Republicans tried to limit the effect of this principle only for companies with incomes up to $ 25 million. The result of the vote is 144-266.

In the end, parliament blocked another amendment from Democrat John Conyers, who tried to cut the bill and leave it with only a clause on transparency. Probably the attempt lobbied by the owners of intellectual property failed: 157-258.

As a result, the parliament adopted only one amendment, which removes from the bill the old rule that is rarely used in judicial practice, which allows the patent holder to protect his intellectual property in case he cannot receive documents from the patent office.

The law “The Innovation Act of 2013” ​​aims to stop the most egregious forms of trolling through several methods.

1. Detailed information . When filing a lawsuit, a mandatory requirement is to provide information on which patents are violated and which specific products are allegedly infringing on these patents and how. This rule makes it difficult for the trolls to file claims in large numbers: a separate document must be drawn up for each defendant.

2. Translation of court fees. The court will receive the right to demand from the losing party to compensate for the legal costs incurred by the winner. This is the key point due to which trolls are now successfully blackmailing victims: they understand that even if they win in court they will pay more than the troll requires them to.

3. Transparency . The law strictly requires the plaintiff to divulge in whose interests it operates. Today, most trolls are one-day affiliates that are created under specific patents. If the company is a subsidiary, the defendant has the right to bring the parent company to court so that it can compensate the defendant for legal costs when the one-day company after a defeat in court declares itself bankrupt and refuses to compensate the costs.

4.Delayed cases against technology users . The law requires the court to suspend proceedings against companies that use the serial product if the manufacturer of this product agrees to transfer the trial to itself. For example, in 2011, hundreds of hotels, cafes, and restaurants paid the Innovatio IP Ventures, LLC patent troll between $ 2,300 and $ 5,000 for "using a WiFi router in a public place." This was one of the first cases when trolls applied a new tactic for filing hundreds of small claims against technology users instead of a major lawsuit against the manufacturer (there they would have no chance, but here at least a hundred thousand can be collected for a penny).

5. Reform of the mandatory disclosure of documents to the court. Under current law, the plaintiff has the right not to name the patent numbers and not to provide other information until the defendant agrees to participate in the process and pays the court fee and other costs (which many do not risk going to). If information on patents were to be discovered from the very beginning, the ridiculous claims of the trolls could immediately become apparent.

6. Examination after issue . The law expands the ability to challenge US patents already granted.

The Electronic Frontier Fund approved the bill and called it the best bill against trolls ever released.