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Return to [[Innovation Policy#Proposed Patent Reform| Proposed Patent Reform]].

'''H.R.9: Innovation Act (2015)''' The [https://www.congress.gov/bill/114th-congress/house-bill/9 | H.R.9:Innovation Act] was reintroduced on February 5, 2015, by Representative Bob Goodlatte (CongressR-VA). The bill was referred to the House Committee on the Judiciary and Subcommittee on the Courts, Intellectual Property, and the Internet, and was placed on the Union Calendar on July 29, 2015. Currently the bill has 27 cosponsors, 15 Republicans and 12 Democrats. <section begin=summary />The full title of the act is "To amend title 35, United States Code, and the Leahy-Smith America Invents Act to make improvements and technical corrections, and for other purposes." <ref name="GovTrack" />[https://www.govtrack.us/congress/bills/114/hr9#| GovTrack]predicts that the Innovation Act has a 36% chance of being enacted. Representative Bob Goodlatte intends for the bill to cut down on abusive patent litigation and strengthen a patent holder's rights.<ref name="innovationactsummary" /> The Innovation Act also proposes certain reforms to the enacted [[Leahy Smith America Invents Act]].

The Innovation Act was introduced on February 5, 2015, by Representative Bob Goodlatte (R-VA). The bill was referred to the House Committee on the Judiciary and Subcommittee on will target the Courts, Intellectual Property, and the Internet, and was placed on the Union Calendar on July 29, 2015. following areas <ref name="innovationactsummary" />: Currently the bill has 27 cosponsors.

The Innovation Act was previously introduced in 2013, but the Senate did not respond with *Abusive patent litigation. *Increasing transparency and reducing weak patent infringement claims. *Clarifying patent litigation procedures and practices. *Bolstering IP centered small businesses. *Reducing referrals to random courts for the introduction review of a similar billpatent cases. In 2015, the House reintroduced the *Weakening power of [[Innovation Act, and the Senate also introduced the similar PATENT ActPolicy#Patent Trolls| Patent Trolls]]. <section end=summary />==Provisions==The full title provisions of the bill is "To amend title 35, United States Code, and Innovation Act encompass all of the Leahy-Smith America Invents Act to make improvements and technical corrections, and for other purposesareas of reform currently in consideration by Congress."

GovTrack predicts that ===Pleading Requirements===In efforts to diminish the Patent Troll threat by the bill sponsors, the Innovation Act heightens pleading requirements for parties filing for patent infringement. Form 18, the form previously used to submit generalized patent infringement claims, has been eliminated by the Judicial Conference in wide-sweeping amendments. This amendment was expected to be implemented December of 2015. <ref name="patentlyo18" /> The Innovation Act also proposes Form 18's elimination by the Supreme Court to reduce patent litigation, especially litigation involving Patent Trolls or Non-Practicing Entities.<ref name="nationallawreview" /> The Supreme Court would be allowed to codify a 36% chance new model for filing infringement complaints that would include notifying the accused parties of being enactedthe claim and its content.<ref name ="govtracksummary" />

Supporters hope that the act would go further in reducing generalized complaints and eliminating loopholes by requiring (with exceptions) the plaintiff to submit infringement charts with the initial complaint.<ref name==Summary==*Heightened pleading requirements: must show how each limitation "patentlyoIA" /> The purpose of each asserted claim in each asserted patent the charts is found within each *Presumption to force the plaintiff to explain the specifics of attorney fees: encourages judges to make a party pay attorney fees if lawsuit claim, how a product or claim is deemed frivolous*Transparency the specific use of ownership: requires plaintiffs to disclose the owner patented idea or process violates each infringed component of the a patent in question so and the identity scope of the real parties behind the litigation is clear**Will ensure that patent trolls cannot hide behind a web of shell companies to avoid accountability for bringing frivolous litigation*Discovery limits: limit discovery in litigation until after a claim construction ruling**Aimed at reducing costeach component's infringement. <ref name="patentlyoIA" />

The House Innovation Act and Senate Patent Act are very similar; both acts address abusive litigation through “increased transparencyAdditionally, more limited discoverya claim of previous commercial use may not result in a court invalidating a patent because it lacks novelty, heightened pleading standardsseems to cover obvious subject matter, and ‘loser pays’ fee shifting”or due to prior art. However, there <ref name="govtracksummary" /> Prior Art refers to evidence indicating that the technology or invention in question has already been used, discovered, or is generally known. <ref name="EPO" /> ===Fees and Other Expenses===  Writers of the bill propose that a delay modified "English Rule" become the new standard in patent litigation in America to avoid frivolous lawsuits and adequately sanction patent trolls for pointless or unfounded claims. <ref name="innovationactprovisions" /> <ref name="patentlyoIA" /> The "English Rule" requires the passing losing party in a trial compensate the prevailing party for its attorney fees. <ref name="NYU" />  The act requires courts to have losing parties provide for "reasonable fees and other expenses" incurred in litigation. The award may be waived only if the losing party is found to have just legal and factual cause to be part of the bills because litigation. If the losing party is unable to pay due to extraordinary circumstances, the court may ask a joined or interested party to cover the award. <ref name="innovationacttext" /> Additionally, the plaintiff may have to pay attorney fees if it dismisses the claim before going to trial unless they were given the explicit right to settle without a court order. <ref name="govtracksummary" /> ===Joinder of Interested Parties=== As part of controversy surrounding the shifting of Fees and Other Expenses provisions, an interested party or parties may be required to cover attorney 's feesand other expenses in the case that the nonprevailing party cannot. Fee shifting was originally suggested Sponsors of the bill hope to prevent Patent Trolls from claiming the inability to pay fees by shuffling accounts between all of their companies by including this provision. <ref name="innovationactprovisions" /> Interested parties may include parties that have invented or invested in the disputed patents or that commercially practice or perform R&D in the same field. <ref name="govtracksummary" /> ===Discovery Stay===  The act establishes that a claim construction ruling must occur prior to discovery. <ref name="patentlyoIA" /> Discovery is a process that occurs pre-trial in a civil action, a conflict between two private parties, and is defined by the federal government as any party's right to obtain relevant information for the trial. Claim construction defines exactly what a way patent includes and the extent to incentivize which a patent holder can protect the subject matter. <ref name="claimconstruction" /> The act also specifies that claim construction previously agreed upon in another court must hold when a patent claim is reviewed by the USPTO or in a new trial. <ref name="patentlyoIA" /> Discovery of additional or non "core" documents is not allowed unless the party requesting them covers the costs of discovery and all parties consent to discovery. <ref name="patentlyoIA" /> By enabling courts to limit discovery, sponsors hope to reduce litigation costs and target patent trolls intending to settle a case quickly using information revealed in discovery. <ref name="innovationactsummary" /> ===Demand Letters=== To protect small firms and businesses , the act requires that were being unfairly accused of the patent owner explain the reason for the lawsuit and how the infringement has occurred to bring the case accused party or parties. <ref name="innovationactprovisions" /> A demand letter sent prior to courtthe lawsuit cannot be used as evidence of willful infringement unless the demand letter specifies which patent is being infringed, what is infringing the patent, so the parent company that they owns the patent, and how one or more claims in the patent are being violated. <ref name="patentlyoIA" /> Anyone found violating these requirements would not be forced to pay additional damages. <ref name= "sectionsummary" /> ===Venue=== The act requires that patent infringement suits only be heard in judicial districts with reasonable connection to the conflict. <ref name="sectionsummary" />  A judicial district in which the following have occurred is considered to have reasonable connection to pay their the dispute: <ref name="govtracksummary" />* the defendant is headquartered or incorporated. * the defendant infringed the patent. * the defendant's facility where the patent continues to be infringed. * the defendant was informed and agreed to the suit.* an inventor of the patent led R&D. * either party runs R&D for the patented invention. * either party manufactures a physical product that violates the patent's claims. * either party runs a process using the patented invention. ===Disclosure of Ownership=== An initial complaint must disclose specifics about the patent including the parent company of the patent and any party with a financial interest in the patent. <ref name="sectionsummary" /> Any change in patent ownership must be provided to the UPSTO. If the information is not provided or updated when changes occur, then the court will make the patentee cover the defendant's attorney fees. However<ref name="patentlyoIA" /> ===Double Patenting=== Within the Innovation Act, several reforms are suggested to the Leahy-Smith America Invents Act. One of these reforms concerns codifying double patenting. <ref name="govtracksummary" /> Double patenting is when two patents are awarded for the same invention to one patent holder. The first-to-file (FTF) system was introduced in the American Invents Act and put into effect in March of 2013. In the FTF system, there the first inventor to file for a patent has priority in protecting the idea. <ref name="entrepreneur" /> The Innovation Act applies the FTF system to double patenting restrictions. If a patent claim is filed on the same day or before a similar second patent, then the first patent will be deemed prior art to the second patent. Thus, double patenting would be prevented unless nonobvious subject matter can be proven. <ref name="govtracksummary" /> ===Manufacturers=== To protect manufacturing investments and patent owners, the act prohibits foreign courts from eliminating a company's US IP licenses in bankruptcy, in accordance with US law. <ref name="sectionsummary" /> On the other hand, the act pushes for plaintiffs to deal with manufacturers instead of the retailers or end users that have been arguments stating purchased the manufacturer's products. <ref name="patentlyoIA" /> Courts may stay customer suits while litigation with manufacturers accused of infringing the same patent is ongoing. <ref name="govtracksummary" /> ===Small Businesses=== In addition to reducing costs and curbing patent troll abuses, the act requires the USPTO to create and distribute educational materials for small businesses involved in aggressive patent litigation. Working outreach programs would be modified to include information on patent litigation practices that fee shifting would actually increase are threatening the settlement rate success of small businesses being accused . This information would also be disseminated through the Small Business Administration and the Minority Business Development Agency. The act directs the USPTO to have public records online about when a patent claim is brought to court along with other specifics regarding the patent's ownership to increase transparency. <ref name="govtracksummary" /> ==References== <ref name="GovTrack"> [https://www.govtrack.us/congress/bills/114/hr9#] 'H.R.9:Innovation Act', ''govtrack.us''. </ref><ref name="innovationactsummary"> [https://judiciary.house.gov/wp-content/uploads/2016/02/782015_InnovationAct3.pdf] 'The Innovation Act', ''Judiciary Committee: Chairman Bob Goodlatte'', (Washington, D.C.). </ref><ref name="patentlyo18"> [http://patentlyo.com/patent/2016/04/elimination-pleading-infringement.html] L. Morad and A.J. Bramhall, 'An Early Review of the Impact of Form 18's Elimination on Pleading Direct Infringement',''PatentlyO''.</ref><ref name="nationallawreview">[http://www.natlawreview.com/article/supreme-court-adopts-amendments-to-federal-rules-may-deter-patent -infringement] Jura Zibas and Gregory Brescia, because they don’t want 'Supreme Court Adopts Amendments to take Federal Rules', ''The National Law Review'', (Western Springs, IL). </ref><ref name="patentlyoIA"> [http://patentlyo.com/patent/2015/02/patent-reform-innovation.html] Dennis Crouch, 'Patent Reform: Innovation Act of 2015', ''PatentlyO''. </ref><ref name="innovationactprovisions"> [https://judiciary.house.gov/wp-content/uploads/2016/02/for-packet-plain-english.pdf] 'The Innovation Act: Key Provisions', ''Judiciary Committee: Chairman Bob Goodlatte'', (Washington, D.C.). </ref><ref name="NYU"> [http://lsr.nellco.org/cgi/viewcontent.cgi?article=1245&context=nyu_lewp] Theodore Eisenberg and Geoffrey P. Miller, 'The English vs. the risk of losing American Rule on Attorneys Fees', ''New York University Law and paying Economics Working Papers''. </ref><ref name="innovationacttext"> [https://www.congress.gov/bill/114th-congress/house-bill/9] 'Summary: H.R.9-114th Congress', congress.gov. </ref><ref name="EPO"> [https://www.epo.org/learning-events/materials/inventors-handbook/novelty/prior-art.html] 'What is prior art?', "European Patent Office: Inventors' Handbook", (Munich, Germany). </ref><ref name="govtracksummary"> [https://www.govtrack.us/congress/bills/114/hr9/summary] 'Summaries for the winner’s attorneys’ feesInnovation Act', in addition to their own"govtrack.us". </ref><ref name="interestsofjustice"> [httphttps://www.bnawilmerhale.com/debateuploadedFiles/WilmerHale_Shared_Content/Files/PDFs/how-PTAB-applies-interests-of-justice-discovery-standard.pdf] 'How PTAB Applies 'Interests of Justice' Discovery Standard', "Law360", Portfolio Media, Inc. (New York, New York). </ref><ref name="claimconstruction"> [http://patentlyo.com/patent/2009/09/claim-reformconstruction-a-structured-framework-1.html] Peter S. Menell, Matthew Powers, and Steven Carlson, 'Claim Construction: A Structured Framework', "PatentlyO". </ref><ref name="sectionsummary" > [https://judiciary.house.gov/wp-n17179934625content/uploads/2016/ 02/072015-Section-by-Section-of-HR-9-Innovation-Act.pdf] 'H.R.9, The "Innovation Act": Section-by-Section Summary", 'Judiciary Committee', (Bloomberg BNAJuly 2015). </ref><ref name="entrepreneur"> [https://www.entrepreneur.com/article/231884] Kirby Drake,'How to Take Advantage of the First-to-File Patent System', Entrepreneur Media, Inc. </ref> [[Category: Public]][[Public Classification::Legislation| ]]