House Judiciary Chairman Bob Goodlatte introduced an amendment to his patent reform bill yesterday that would drop his plan to expand covered business method (CBM) review to software patents.
The bill, known as the Innovation Act, was introduced by Goodlatte in October in an effort to curb patent trolls. Amongst other things, it would require more transparency from NPEs about their subsidiaries, patents and business practices.
The provision Goodlatte now wants to remove would have allowed parties accused of patent infringement to challenge the validity of the patent in question through a streamlined USPTO post-grant procedure. The process would have provided a cheaper and faster alternative to litigation for accused infringers seeking to get a patent invalidated.
At present, this procedure is only available for certain business method patents “covered” under Section 18 of the AIA via CBM review. The cost of having a pursuing invalidation under CBM review tends to be in the $100,000 to $300,000 range including the cost of attorneys and filings fees, compared to upwards of $1 million to pursue invalidation through litigation.
In addition, CBM review allows patents to be challenged as being too abstract, too broad or too vague, grounds that are not available for other post-grant procedures at the USPTO.
Goodlatte’s about-face may be the result of the efforts by lobbyists representing large corporations with a business model that depends on patents. In September, over 100 companies wrote a letter to Goodlatte and other members of the Committee on the Judiciary protesting against plans to expand CBM review.
Expanding CBM review to other types of patents has received support from some trade associations and has been suggested in other legislation designed to combat trolls, such as the Stopping the Offensive Use of Patents (STOP) Act.
