Tuesday, May 3, 2016

Supreme Court to Decide New Patent Rules

The government recently made it easier for companies and/or individuals to challenge patents without fighting in Federal courts.  It is no secret that patent litigation is one of the most costly and lengthy legal battles possible.  The new process allows the United States Patent and Trademark Office ("USPTO") to make a determination about the patent dispute.  Of note is the fact that the USPTO would use different legal standards to resolve the issues.  This would mean that a Federal court judge and the USPTO could reach different conclusions over the same dispute.

The case before the Supreme Court comes after Congress "updated" the patent laws in 2011.  The issue before the Court is whether the USPTO rules must conform to the legal standards the courts use in adjudicating a patent dispute.

One of the purposes of the 2011 overhaul was to cull bad patents and discourage patent trolls (those who buy patents who do not manufacture the patented item, but merely assert those patents against others).  As you can imagine, because patent litigation is so costly, many patent trolls found success in suing companies for patent infringement.  In many instances, it was a better business decision to pay the patent troll rather than fight the issue in court.

Personally, I like the idea of a less expensive process allowing litigants to get resolution in patent matters.  However, I fear that the parties would go through the USPTO process and then the "loser" would decide to initiate a lawsuit which would put the parties in the unenviable position of having to pay twice for an adjudication of the same issue.