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Volume XII, Number 268


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September 22, 2022

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USPTO Director Lee Endorses Innovation Act But Suggests Tweaks

On April 14, the House Judiciary Committee, chaired by Congressman Bob Goodlatte, heard comments from Michelle Lee, Director of the U.S. Patent and Trademark Office, on H.R.9, the “Innovation Act.”  This bill, which seeks to address abusive tactics employed by patent trolls in connection with patent litigation, was previously passed in the House and was reintroduced in the current session.  Director Lee generally supported the bill, stating that “the USPTO believes that legislation to curtail abusive patent litigation is necessary and appropriate at this time.” 

The legislation contains the following key provisions, all of which were generally supported by the USPTO:

  • Requiring an award of attorney’s fees and expenses to the prevailing party unless the non-prevailing party’s litigation position or conduct was “reasonably justified in law and fact”;

  • Heightened pleading requirements, including that the complaint explain how each element of a patent claim is met by the accused product or process or why the information needed is not readily accessible;

  • Limits on discovery to prioritize discovery regarding claim construction and to keep the discovery “proportionate” to the needs of the case;

  • Stays of suits against customers or retailers in favor of actions against the manufacturer of the technology (but Lee advocated then binding the customer or retailer to the determination in the main action);

  • Make ownership more transparent; and

  • Curtail abusive demand letters.

Director Lee emphasized that since the Supreme Court’s decision in Octane Fitness last year, district courts have increased the prevalence of attorney fee awards.  She generally endorsed provisions designed to allow courts to see though a shell company that might otherwise insulate the real party in interest from an attorney fee award, but cautioned that the provision should be limited to “those with “no substantial interest in the subject matter at issue other than asserting such patent claim in litigation.”  She noted that otherwise the provision may deter investment in start-up companies.  Throughout, she also emphasized the need to preserve traditional judicial discretion in implementing the provisions of the act.

© 2022 Honigman Miller Schwartz and Cohn LLP National Law Review, Volume V, Number 112

About this Author

William Berndt  Honigman Miller trade secrets false advertising trade secret law

 Mr. Berndt is a trial lawyer with substantial experience in state and federal courts across the country. He focuses his practice on trade secret and false advertising claims. He represents businesses and senior executives in disputes relating to noncompetition agreements, trademark and copyright, fraud, professional liability, internal investigations, and general business and commercial litigation. Mr. Berndt has first-chair experience in trials, arbitrations and other proceedings.

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David L. De Bruin appellate attorney patent litigation USPTO Honigman Chicago
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Mr. De Bruin is a seasoned first-chair trial and appellate attorney. He concentrates his practice on patent litigation and related proceedings before the United States Patent and Trademark Office. Mr. De Bruin successfully argues legal issues, as well as explain the most complex technology to judges and juries.

  • Tries patent cases in a variety of venues before judges and juries and has successfully argued numerous patent cases before the Federal Circuit Court of Appeals
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Marcus D. Fruchter lawyer Honigman Chicago office litigation specialist

Mr. Fruchter defends or initiates litigation when it is inevitable and avoids lawsuits where possible. He provides zealous and creative representation that protects his clients’ legal rights and advances their strategic objectives. Mr. Fruchter litigates in state and federal courts across the country, and he has handled matters involving international and cross-border issues.

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Nicholas A. Gowen Honigman Chicago complex commercial litigation attorney t

Mr. Gowen represents companies, individuals and law firms in disputes, including those involving intellectual property, trade secrets, unfair competition, employment matters and other business litigation matters. He approaches litigation with an eye toward results; understanding that advancing his clients’ litigation strategies should fit within their overall business interests.

  • Counsels businesses on ways to avoid litigation and resolve disputes using alternative measures
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Steven A Weiss Litigation attorney Honigman Law firm Chicago ediscovery
Leader, Complex Commercial Litigation Practice Group

Mr. Weiss provides advice on a wide variety of business litigation for companies and business people. He is focused on resolving business disputes with particular experience handling intellectual property, breach of contract, trade secret, employment and covenant not to compete matters. Local and national companies and individuals retain Mr. Weiss to handle a full range of business disputes because they trust his judgment and litigation skills.

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