SIA Commends Introduction of Legislation to Reduce Abusive Patent Litigation

by David Isaacs, Vice President, Government Affairs

In a statement released today, SIA commended House Judiciary Committee Chairman Bob Goodlatte (R-Va.) for his leadership in introducing the “Innovation Act” (H.R. 3309), legislation to reduce abusive patent litigation:

“Enactment of this bill can play an important role in reducing abusive patent litigation practices that needlessly raise litigation costs and undermine innovation by redirecting research expenditures and other resources toward litigation expenses.

“The semiconductor industry is research intensive – companies invest, on average, 18 percent of revenues to research and development, and nearly half of the top 15 American patent recipients are semiconductor companies.  Semiconductors are one of the country’s top exports, and the industry is a leader in product design and advanced manufacturing, directly employing 250,000 Americans and providing indirect employment of approximately 1.1 million.  To further bolster our country’s innovation landscape and the overall economy, action by both Congress and the judiciary is needed to restore balance to our patent system and strengthen the rules governing the resolution of patent disputes.

“The ‘Innovation Act’ is an important step forward in this process.  The bill includes many elements supported by SIA to minimize abusive patent litigation practices, such as fee-shifting in appropriate cases, enhanced pleading requirements, and protection of patent licenses in bankruptcy.  At the same time, SIA remains concerned about the potential adverse effect on the semiconductor industry of certain elements contained in the bill, such as the provision expanding the covered business method patent program and the provision on the stay of customer suits.  We look forward to working with you, the co-sponsors, and others to ensure that the bill deters abusive behavior while avoiding unintended consequences that might weaken our patent system.  .

“We applaud your leadership in addressing this important issue, and we are committed to working to help pass legislation that reduces abusive patent litigation conduct, strengthen our patent system, and promote innovation.”