Obama to Rein In Patent-Holding Firms

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Tuesday, 04 Jun 2013 12:10 PM

By Melanie Batley

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The White House was set to introduce a set of executive actions on Tuesday to limit the litigation practices of patenting firms who are increasingly seen as abusing the patent system and disrupting competition through costly litigation.

President Barack Obama wants Congress to consider five executive actions and seven proposed legislative changes intended to target patent-holding firms that amass portfolios of patents for the sole purpose of pursuing licensing fees, The Wall Street Journal reported.

The practice often forces technology companies and financial institutions into costly court cases to protect their products.

One measure will require the Patent and Trademark Office to start a rule-making process aimed at requiring patent holders to disclose the owner of a patent when suing a business. To date, businesses often are left in the dark about who owns the patent they are being accused of infringing, the Journal reported.

The president also plans to press Congress to pass legislation that would allow sanctions on patent-holding firms that file lawsuits deemed by courts to be abusive. Another measure would direct the patent office to train examiners to scrutinize applications for overly broad patent claims.

Patent-holding firms have also increasingly been applying to the International Trade Commission to settle disputes, thereby circumventing federal courts, a practice the president is also seeking to limit.

The latest moves build on other initiatives Obama has taken since signing a law in 2011 to overhaul the patent system for the first time in six decades. Obama said in February that some firms "don't actually produce anything themselves. They're just trying to essentially leverage and hijack somebody else's idea to see if they can extort some money out of them."

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