Patent Litigation Reform: The Courts, Congress, and the Federal Rules of Civil Procedure

Barely three years after passing the America Invents Act, Congress is again considering patent reform legislation. At least fourteen patent reform bills were introduced in the recently concluded 113th Congress. Several of those bills focused specifically on patent litigation, proposing, among other things, to impose heightened pleading requirements on plaintiffs, to limit discovery, and to create a presumption that the losing party should pay the winner’s attorneys’ fees. None of the proposals became law, but one of the bills (the Innovation Act) passed the House of Representatives. In addition, scholars continue to call for reform, and Republican members of Congress have said that, with their party now holding a majority in both houses, patent reform will be on the agenda in 2015. As was the case in the six-year process that led to the America Invents Act, the early proposals that failed in Congress will undoubtedly inform future bills. With an eye toward those future bills, this essay argues that legislative reform is unnecessary because the courts and the Judicial Conference of the United States (the body charged with maintaining the Federal Rules of Civil Procedure) are already in the process of fixing several problematic areas of patent litigation. Moreover, the changes being made by the courts and the Judicial Conference are more nuanced and sensible than the proposals Congress has considered, which would mandate defendant-friendly changes in all types of patent cases — not just the weak cases, often filed by so-called patent trolls, that are spurring the cries for reform. Indeed, the legislative proposals offer little more than the same, generic, anti-litigation solutions that are often invoked to remedy perceived crises of “abusive” litigation, whether in the fields of tort law, civil rights, securities law, or, now, patent law. In addition, the timeworn proposals percolating in Congress treat only the symptoms of the patent system’s illness; they do not address fundamental flaws in the system, including the poor notice provided by and poor quality of many patents issued by the PTO, particularly in the information technology sector. The breadth of the legislative proposals also poses a risk of unintended consequences. Heightened pleading requirements, for instance, may block legitimate assertions of patent infringement in industries such as biopharmaceuticals where infringement occurs in research or production facilities to which the patent holder cannot gain access. And rather than reducing litigation, the proposals could actually increase litigation about peripheral matters such as the permissible scope of discovery and which party should bear the costs of that discovery. Legislation, simply, may be too blunt of an instrument to effectively reform patent litigation. Rather, as a matter of institutional choice, incremental changes driven primarily by the courts seem to be a better option