Two Senate bills currently under consideration would “open the floodgates” to low-quality patents and leave technology developers and end-users with fewer options for challenging the legitimacy of those patents, the Quality Patents Coalition said last week in comments to the Senate Judiciary Committee. The American Bankers Association is a member of the coalition.
The PREVAIL Act (S. 2220) would change how the Patent Trial and Appeal Board adjudicates patent availability. The Patent Eligibility Restoration Act (S. 2140) would broaden what could be patented by establishing that only specified subject matter — that is, a natural process wholly independent of human activity — is ineligible for patenting. In its comments, the coalition said both bills would undo the reforms of the America Invents Act, or AIA, a 2011 law that, among other things, sought to crack down on the misuse of patent law by “patent trolls” who used dubious patent claims to extract large settlements from legitimate patent holders.
“For too long, patent trolls and foreign operators have been able to use low-quality patents to exact settlements from operating companies in both the services and manufacturing sectors,” the coalition said. “Non-practicing entities, including those funded by hidden and overseas interests, often target relatively small and local businesses who use innovative technology with patent infringement allegations in efforts to extract nuisance settlements. Ensuring that company (and ultimately, consumer) resources are not diverted to pay ill-gotten rents to those leveraging low-quality IP is a critical component of the reforms enabled by the AIA.”
