The White House Releases Update on "Protecting American Inventors and Innovators"

by McDonnell Boehnen Hulbert & Berghoff LLP

Washington - White House #1Earlier today, the White House provided an update on the five executive actions that it announced in June of 2013.  At the time, we reported on the President's legislative recommendations and executive initiatives, as well as the Patent Assertion and U.S. Innovation report that accompanied them (see "'When the Patent System is Attacked!' -- The White House Task Force on High-Tech Patent Issues").  In addition to "announcing major progress" today on these initiatives to combat so-called "patent trolls" ("FACT SHEET -- Executive Actions: Answering the President’s Call to Strengthen Our Patent System and Foster Innovation"), the White House hosted a live webcast entitled "Building a Better Patent System."  President Obama did not participate, but instead PTO Deputy Director Michelle Lee, Secretary of Commerce Penny Pritzker, U.S. Chief Technology Officer Todd Park, and Gene Sperling, Director of the National Economic Council collectively spoke for about 30 minutes on how the executive actions were "building a better patent system" ("Building a Better Patent System").

With regard to the progress of the patent litigation reform legislation, Mr. Sperling acknowledged that the White House did not agree with everything that ended up in the Innovation Act.  There was some suggestion that the fee-shifting provision found in the final House bill was not what the White House was expecting.  Instead, the President had originally suggested modifying the patent attorney fee provision to have it mirror the equivalent provision in the copyright statute.  This, presumably, meant removing the "exceptional case" requirement, while maintaining the default "American Rule," in which generally both sides pay their own costs.  Of course, the provision in the Innovation Act adopted the so-called "British Rule," with the default being that the losing (i.e., non-prevailing) party pays.  Mr. Sperling indicated that the White House was open to comprise on the issue.  Nevertheless, he said the President is hopeful that he will be able to sign the new legislation into law sometime in 2014.

As for the executive initiatives, the most immediate was the launching of a new "on-line toolkit" "[t]o help level the playing field and ensure individuals and businesses know their rights and are aware of available resources before entering into costly litigation or settlements . . . ."  On this site, there are icons for various resources directed to victims of abusive patent practices.  The first link provides information for what to do if "I've been sued," which provides information about the patent litigation process.  Also within this link are resources to help find a lawyer (with links to the Office's list of registered patent agents and attorneys, as well as state bar attorney lists), determine if anyone else has been sued over the same patent, and provide information about challenging the patent at the Office.  Another link is directed to individuals that have received demand letters.  The resources on this site include identifying options for the demand-letter recipient, providing guidance if the recipient is an end-user customer (with convenient links to the states attorney general's offices and the FTC), and providing links to find out more information about the asserted patent and who might be behind the demand letter.  The PTO toolkit also includes links to help identify related cases, to provide information about the patent infringement process, and to more generally provide information about patents.

Perhaps the most interesting link on this new "online toolkit" website is the "Resources and Glossary."  In this section, the Patent Office provides links to several other sites, at least one of which has stated quite plainly that "the patent system is broken," and that the "US Patent Office . . . issues questionable patents every day."  One of the "resources" is to a crowd-sourcing website, Ask Patents, which can assist accused infringers in identifying invalidating prior art.  This is the same website that the Electronic Frontier Foundation ("EFF") used to help find the art that was cited in its petition for Inter Partes Review of Personal Audio's podcasting patent (see "When NPR Podcasters Hit the Patent System – An Update").  In addition, one of the "resources" is a link to the "Trolling Effects" website, which "is a project of the Electronic Frontier Foundation . . ." ("About Trolling Effects").  This site also starts from the premise that the patent system is broken, and offers a "crowd-sourced" demand-letter database.  Of course, submission of demand letters is purely voluntary, and is, for obvious reasons, only done by recipients.  Currently the database holds about 45 letters.  And, not surprisingly, another one of the "resources" is the EFF website itself, ostensibly for the purpose of providing "legal services and referrals, through a 'Cooperating Attorney' list."

On the subject of "crowdsourcing," the White House also announced three new executive actions aimed at "encouraging innovation and further strengthen[ing] the quality and accessibility of the patent system."  The first of these, "Crowdsourcing Prior Art," is a new initiative to expand ways in which the general public can help patent examiners and applicants find prior art.  No details were provided, however, about how such a system would work.  Second, the White House indicated that it was introducing more robust technical training for its patent examiners.  The Administration is requesting that "innovators . . . volunteer their time and expertise" to provide such training.  Finally, the White House indicated that it will dedicate resources to assist inventors without legal representation.

Patent Docs will continue to report on any updates from the White House related to these executive actions and initiatives.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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