Key Vote #House: #LLPH Urges “NO” Vote on #InnovationAct (#HR3309) Tomorrow! #TCOT #MakeDCListen #SmallBusiness

LLPH urges a NO vote on the Innovation Act (H.R. 3309), sponsored by Rep. Bob Goodlatte (R-VA). While this bill is well-intentioned and something certainly must be done about patent trolling, this bill would have consequences that could greatly hurt small businesses and ordinary, every day American inventors.

Our allies at Eagle Forum stated:

The Founders established patents in the Constitution as a private property right for inventors. This property interest benefits the nation economically through the “promot[ion] of science and useful arts.” This bill will weaken American patents, patent rights, and the ability of innovators — particularly independent inventors — to secure their constitutionally guaranteed private property right in their discoveries.

Inventors are supposed to enjoy the “exclusive right” to their intellectual property for a period of time. H.R. 3309 would counter this Constitutional vision for patent rights by making patent litigation more common, more protracted, and more expensive for inventors.

Proponents want to call this “litigation reform,” but really, this bill tilts the judicial process in favor of infringers and big business but against patent owners. Eagle Forum sympathizes with small businesses that receive demand letters from what are called “patent trolls” and we are open to addressing this practice in a narrow, targeted manner. However, H.R. 3309 goes well beyond addressing the grievances of such small business end users and will diminish property rights and weaken U.S. patents.

More than the substantive issues, we are concerned with the way this bill is being rushed through the House. The Judiciary Committee held a single hearing just two weeks after the bill’s introduction and marked up the bill three weeks later. Soon after, there was a bipartisan appeal by concerned committee members requesting a second hearing, featuring independent inventors, venture capitalists, R&D shops, IP-based small businesses, judges, non-practicing entities that play a vital role in technology transfer such as universities, and victims of foreign IP theft, but it was ignored.

Now, just three weeks after markup (one week being Thanksgiving recess), the House is voting on this vast and complicated bill. This process is unbecoming of a great American legislative body.

This bill is an excellent way to disincentivize creativity, innovation, new inventions, and future companies. It would foster new intellectual thieves who will trample over patent-holders and would-be job creators. 

H.R. 3309 does not meet the standard set forth in Article I Section 8 Clause 8 of the U.S. Constitution that secures to inventors “the exclusive right to their respective writings and discoveries.” This bill will diminish private enterprise, individual liberty, and family integrity, which relies on well-paying jobs and economic growth spurred by the discoveries of innovators. 

The innovative and ingenious spirit of individuals is foundational to what has made America great. This spirit should be incentivized and esteemed — not stifled. Stopping intellectual property burglars and patent-trolls is essential, but not if we are also trampling the rights of intellectual property owners and great creative minds. This bill falls short of the Constitutional guarantee of the property rights of inventors and is bad for independent inventors, jobs, families, and the American economy. We must stop it!

Rep. Rohrabacher, a close friend of LLPH, opposes the bill stating:

He said studies have shown that most patent infringement cases are not frivolous. Instead, he said, small inventors will be discouraged from defending their intellectual property rights against large corporations who can afford to lose lawsuits.

“This schedule suggests the fix was in,” said Rohrabacher. “The clear message to little inventors: give thanks for your intellectual property rights, because you may not have them by this time next year.”

The bill’s supporters say it takes aim at so-called “patent trolls,” but Rohrabacher, rejecting that pejorative characterization, said the only people it hits are small, independent inventors.

“These so-called villainous trolls,” contended Rohrabacher, “are patent holders, or companies who represent patent holders. They are engaged in defending their rights against the infringement of those patents that they own.”

Rohrabacher asked his colleagues to postpone a vote on the bill until next year.

In LLPH’s opinion, this bill is too wide of a scope and will likely hurt small businesses and patent holders who would have to fight against big businesses. We need to rethink this bill and take our time…rushing it like Obamacare was is wrong and a bad idea. This bill is as bad as the Leahy-Smith America Invents Act that was passed about two years ago (which Mr. Goodlatte applauded in his testimony before the Rules Committee). 

We honor the committee’s hard work, but we will have to oppose the bill in its current state and will likely score against it in our 2013 Congressional scorecard.

In addition, we may score a few amendments that would improve the bill:

#7: Rohrabacher Amendment to strike section 9 (which would strike judicial review in certain patent cases). If section 9 is left in, this would end important checks and balances in these cases. 

#4: Massie Amendment: Strikes section 5, the “Customer-suit exception” provision. The provision in the bill undermines small businesses and targets “patent trolls” but this loophole is too broad. 

If both improving amendments are passed, we may decide to not score against the bill. But without both passing, we will definitely have to score against this bill. 

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