There are people who wish that the U.S. patent system would just go away.  Their allies successfully lobbied for and passed the ‘America Invents Act’ back in 2011 that resulted in the USPTO patent death squads, also known as the Patent Trial and Appeal Board (PTAB).  As we described last month, the PTAB kills patents with impunity and at a high rate, in part by applying rules that are different from the Federal courts and that are patent owner-unfriendly.

Congress intended PTAB patent review to thwart patent ‘trolls’ that abused the patent system to extort money, a goal that PTAB review largely achieved.  Congress’ baby-with-the-bathwater approach created a new and different extortion business model – trolls who challenge patents before the PTAB solely for the purposes of extorting money from patent owners and manipulating stock prices.  The law of unintended consequences is alive and well.

The America Invents Act and recent Supreme Court decisions restricting patent rights have had a real and negative effect on innovation in the U.S.  The U.S. Chamber of Commerce in its international intellectual property ranking concluded that the U.S. patent system fell from first to twelfth in the world in just two years, now tying with Italy and behind Spain and Korea.  For the first time, the U.S. also fell from the top 10 in Bloomberg’s international innovation index.

But there is hope, whether audacious or not.  The U.S. Supreme Court is currently considering whether the U.S. Constitution reserves the authority to invalidate patents to the Federal courts and not to the PTAB.  The Federal courts apply rules that are more balanced between patent owner and infringer.  The U.S. Supreme Court should decide the case during 2018.

In another arena, bipartisan supporters of patent rights (bless them) also introduced the ‘Stronger Patents Act‘ in the U.S. House and Senate.  The Act contains numerous tweaks to overcome the unnecessarily destructive effects of PTAB review and would reverse a Supreme Court decision largely prohibiting injunctive relief for patent infringement.  The Act would go a long way toward restoring a balance between the rights of the patent owner and the accused infringer.  Write your Congressman.

— Robert Yarbrough, Esq.

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