Patent Law

The following is excerpted from the August 24, 2009 post at the Coaltion for Patent Fairness' better mouse trap blog:

The rise in litigation can be attributed to two factors: first, the U.S. Patent and Trademark Office is processing patent applications of an increasingly technical nature resulting in broadly worded patents being approved; and second, a litigation system that provides no guidance to the courts regarding the calculation of damages in legitimate infringement cases is leading to an increase in unjustified infringement claims.

The House Judiciary Committee is now considering legislation that would address these factors and additional challenges faced by today?s Patent and Trademark Office.  The Patent Reform Act of 2009 (H.R. 1260) would provide clear guidance to the courts on how to fully and fairly compensate inventors and innovators for legitimate infringement claims, in particular how judges and juries should go about  calculating the value that the plaintiff?s invention contributes to the defendant?s product.  The underlying issue isn?t frivolous litigation, the issue is uncertainty in the way damages are calculated, which creates risk and unpredictability about what courts and juries will award for compensation. 

Today?s products are made up of thousands of component parts, which may involve hundreds of thousands of patents.  In many cases where an infringement claim involves only a small part of the whole product, plaintiffs base their ?reasonable royalty? claims on the value of the entire product, rather than on the value of the specific feature or functionality produced by the infringing product or process.  Because the courts lack specific guidance on calculation of damages the resulting unpredictability provides opportunities for litigation syndicates to seek unjustified awards, and extract unmerited settlements due simply to the risk created by an uncertain system.

Read the full post here.