Status of Senate Judiciary Patent Bill Unclear Heading into Planned Markup
The Senate Judiciary Committee remained scheduled at our deadline Monday to mark up the Patent Transparency and Improvements Act (S-1720) Tuesday, but it remained unclear if the committee would be able to reach an agreement in time, industry officials told us. The committee is set to meet at 2:30 p.m. in 106 Dirksen. Senate Judiciary had scheduled the Tuesday meeting so the S-1720 markup would not bog down the committee’s regular Thursday session, but it may still end up on the docket for Thursday, an industry lawyer said. Chairman Patrick Leahy, D-Vt., said in a statement Monday that he still hopes “we can begin consideration of that package tomorrow.” Leahy and other members of the committee have said for weeks that negotiations are close to completion on a compromise version of S-1720, the Senate’s marquee bill to curb patent litigation abuse (CD April 4 p9).
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Negotiations on the bill continued throughout the weekend and appeared to still be ongoing Monday, parties said. Those negotiations “were positive, and I am confident we are closer to solidifying a bipartisan agreement that incorporates the ideas of many members,” Leahy said in a statement. As of Monday afternoon, there was a “50-50 chance” a compromise, to come in the form of a manager’s amendment, would be ready by the time the committee meeting Tuesday, said Cathy Sloan, Computer and Communications Industry Association’s vice president-government relations. Even if the manager’s amendment drops before the committee meeting, “it’s unlikely that they'll finish” Tuesday, Sloan said. “The only way they could move it really quickly is if they literally have everybody on board with the manager’s amendment.” That “would only occur if they circulated it” Monday, she said. Sloan and others told us they were not aware of a manager’s amendment circulating Monday. The industry lawyer told us it appeared “tough” for the committee to move S-1720 before the upcoming recess. It’s not critical that the committee mark up S-1720 this week, as long as it’s able to move it to the Senate floor by the end of April, Sloan said.
Sen. Chuck Schumer, D-N.Y., began playing a “bigger role” in S-1720 negotiations over the weekend and is “trying to get the bill together,” the industry lawyer said. Schumer’s push for an expansion of the Patent and Trademark Office’s covered business method patent review program is widely known to be “on the cutting room floor,” but his role in the negotiations has greatly expanded, the lawyer said. Schumer has certainly widened the scope of his interest in the negotiations beyond the issue of patent quality, but Schumer, committee ranking member Chuck Grassley, R-Iowa, and Sens. John Cornyn, R-Texas, and Orrin Hatch, R-Utah, are “all in the mix,” Sloan said.
The weekend’s negotiations didn’t produce any “surprising shifts” in the language of the bill, Sloan said. Negotiations remained open on compromise provisions dealing with fee-shifting, a revamp of the pre-claims construction discovery process and heightened pleading, along with a provision allowing courts to stay patent lawsuits against end-users in some circumstances, the lawyer said. Leahy is also continuing to negotiate with Hatch on a provision that would prevent a patent assertion entity (PAE) from using essentially asset-less shell companies in a patent case to avoid paying damages at the end of it if the case goes against the PAE, an industry lobbyist said. It’s been difficult to reach a deal on that provision, because “trying to make sure that you capture those hurting the system without hurting small inventors and legitimate entities is a very hard challenge,” the lobbyist said.
Industry lobbying continued Monday amid the ongoing negotiations. The pro-revamp Main Street Patent Coalition urged Congress to pass legislation on litigation-related measures like fee-shifting, along with measures meant to address patent quality and abuses of pre-litigation demand letters. Meanwhile, IBM said it was set to discuss the Senate’s patent revamp efforts as part of its scheduled set of meetings on Capitol Hill this week on industry issues.