Comments on Administration Proposals for Addressing Patent Troll Litigation

Charles Gorenstein
Partner
Birch Stewart Kolash Birch, LLP
June 5, 2013

The administration’s proposals to require identification of the real party in interest in any patent will likely have little effect on trolls. It will be too simple a matter to develop evasive strategies. In any event, until greater control is exercised over improper litigations, identifying any one or more parties involved will do little to curb abusive and detrimental practices.

Permitting greater discretion in awarding fees for improper litigation and/or litigation tactics is definitely called for, and could be expected to curb improper litigation by trolls (or anyone). As noted by Chief Judge Rader in an article published June 5, 2013, the courts already have power to take such measures but are too reluctant to do so.

The administration proposes to change the ITC standard for obtaining an injunction. That may be of some use in curbing abusive tactics in the ITC. The measure that will have a more significant effect is to change the ITC standard for defining a “domestic industry” as must be proven in order for a patent owner to seek a remedy from the ITC. The ITC is tasked with protecting domestic industries from infringing foreign imports. Some years ago the ITC expanded the definition of a domestic industry to include mere licensing of patents. It was widely believed that this change was for the purpose if increasing the appeal of the ITC as a forum for patent enforcement at a time when the agency’s caseload was declining. That change has now come back to haunt as it has opened the door to trolls whose only activity is licensing, but otherwise do not constitute an industry of any type that may call for the type of trade protection administered by the ITC.