Thursday, August 6, 2015

Intellectual Property: The STRONG, TROL, and Innovation Acts of 2015

By Cole Carlson

The Support Technology & Research for Our Nation’s Growth Act, otherwise known as the STRONG Patent Act of 2015, was recently introduced into the Senate by Sens. Chris Coons, Dick Durbin, and Mazie Hirono. The bill proposes some major reforms: (1) amending some of the recently created post-grant proceeding rules and procedures; and (2) cracking down on abusive demand letters, among others. In the House of Representatives, Rep. Bob Goodlatte re-introduced the Innovation Act, proposing similar reforms. Also, the Targeting Rogue and Opaque Letters Act, otherwise known as the TROL Act, recently passed the House Commerce Subcommittee with bipartisan support.

One of the major changes currently proposed in both the STRONG Act and the Innovation Act involves changing the standard used in claim construction when practicing in front of the Patent Trial and Appeal Board (PTAB). Currently, the PTAB uses the “broadest reasonable interpretation” standard. Both acts propose to use the standard adopted in district court litigation: “the meaning a term would have to a person of ordinary skill in the art at the time of invention.” STRONG also proposes to change the burden of proof at the PTAB to a “clear and convincing evidence” standard, which is the standard currently used in district court litigation.

Additionally, all three acts take on patent demand letters. STRONG would empower the Federal Trade Commission to crack down on abusive and intentionally vague patent-related demand letters. STRONG attempts to lay out the various ways patent demand letters have been deficient in the past and create liability for those who intentionally or recklessly send vague demand letters. This includes actions such as sending a demand letter while knowing of no right to enforce, communicating that legal action will be taken against the recipient, seeking compensation from the recipient when the patent has already expired, and failing to include the identification of a patent or a person having a right to enforce a patent. A person who violated this part of STRONG would be subject to any penalty that could be enforced by the Federal Trade Commission. The TROL Act concerns itself with sending bad faith demand letters, clarifies that such activity can violate the Federal Trade Commission Act, and allows the FTC and state attorneys general to enforce its provisions with civil actions through a showing of “bad faith.” The Innovation Act, on the other hand, has no such FTC empowerment and only limits the establishment of willful infringement if the demand letter was purposefully vague.

The STRONG, TROL, and Innovation Acts propose to continue the reform that started with the America Invents Act in 2012. The acts are reacting to trends in post-grant proceedings, as well as trends in the district courts. The proposed reforms, at first blush, seem pro-patentee and pro-consumer at the same time. All three bills, however, have yet to pass both houses and are awaiting further votes. More changes to their substance may be forthcoming.