On July 26th, Congressman Dana Rohrabacher (R-CA) introduced H.R. 6557, the Inventor Protection Act, into the House of Representatives. This bill is the latest proposed piece of legislation to help undo some of the more damaging effects of recent federal government actions on patent law which have negatively impacted the ability of patent owners to enforce their patent rights against infringers.
Provisions of the Inventor Protection Act have been specifically designed to counteract aspects of a pair of decisions made by the U.S. Supreme Court which have limited both the legal remedy available to patent owners proving infringement as well as the option of district courts for filing patent infringement cases. As the proposed bill notes, the right to exclude others from practicing a patent technology through an injunction was stripped by the Supreme Court’s 2006 decision in eBay v. MercExchange. Likewise, patent owners are no longer able to file infringement suits in their home jurisdiction thanks to SCOTUS’ 2017 decision in TC Heartland v. Kraft Foods Group Brands.
Before anyone gets too excited, however, one of the aspects of this bill that needs to be pointed out early is that the legislation would create a definition for “inventor-owned patent” referring to patents which are held entirely by the inventor of the claimed invention; the provisions of this bill are limited to such inventor-owned patent. Thus it appears that companies acquiring patents from inventors will not benefit from the protections this legislation would afford to inventors owning their own patents. There also could be some question as to whether holding companies set up by an inventor to hold the patents for licensing operations would find this bill advantageous.
To counteract the effects of TC Heartland, the Inventor Protection Act would give an inventor the right to bring a civil action for patent infringement where the defendant is subject to the court’s jurisdiction or where the defendant has committed an act of infringement. An inventor asserting an inventor-owned patent would not be limited to those jurisdictions where a defendant has a regular and established place of business. On the flip side, anyone seeking a declaratory judgment against a patent owned by an inventor can only do so within the district where the inventor is domiciled or where the inventor consents to have the action brought. Further, if the inventor is a party in an action involving an inventor-owned patent, the case can only be transferred to another venue if the inventor consents to the transfer.
The bill also rolls back the effects of eBay v. MercExchange by restoring the court’s presumption of irreparable harm to an inventor upon a finding of infringement. The proposed legislation would also create a series of simplified damages available to an inventor proving infringement of his or her patent. These damages include the total profits attributable to the infringing party’s use of the patented invention or 25 percent of the sales attributable to the infringing use. The bill retains the language enabling an inventor to request trebled damages for willful infringement while also including a presumption that the infringement is willful if the infringing party is an expert in the field of the invention.
The Inventor Protection Act would also give inventors some much appreciated ability to remove themselves from patent validity trials conducted by the Patent Trial and Appeal Board (PTAB). First, the bill prevents any executive agency other than the U.S. Patent and Trademark Office from making a determination about the validity of a patent within the executive branch. Further, the bill would prevent the USPTO from reexamining, reviewing or otherwise making a determination about the validity of an inventor-owned patent unless the inventor voluntarily agrees to that determination process. The Restoring American Leadership in Innovation Act, which is co-sponsored by Congressman Rohrabacher, goes much further in eliminating the PTAB entirely, but inventors would at least see some benefit from being able to preclude the patents they own from validity trials at the PTAB.
Randy Landreneau, the President of inventor advocacy group US Inventor, offered the following statement on the introduction of the Inventor Protection Act:
“A new day is dawning for American innovation as legislators are realizing that inventors have been effectively shut out of our patent system without any realistic path to enforcing their hard-earned patents. Passing this bill will restore confidence in patent rights and draw capital investment back to small disruptive businesses built on the ingenuity of American inventors.”
The office of Dana Rohrabacher has been contacted for a comment as to why this bill has been introduced after the Congressman co-sponsored the Restoring American Leadership in Innovation Act. His office has forwarded the following official statement:
“Innovation is the engine for America’s future prosperity. The continued efforts of inventors enable our country to maintain leadership in the global economy. The United States Constitution specifically secures for inventors the exclusive right to their discoveries, but, unfortunately, legal protections for those rights are on the decline. Too often we see multinational corporations stealing the property of those who do not have the resources to defend themselves, then tying up inventors in endless reviews and litigation. Worse, the system is now structured to make it economically worthwhile for those corporations to pursue this strategy. The founders of this nation rightly understood that property rights, including to one’s writings and discoveries, are essential to liberty and economic prosperity. That is why they were written into the Constitution.”
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