Grassley: Congress should act ‘decisively’ on patent reform

Senate Judiciary Chairman Chuck Grassley (R-Iowa) on Wednesday said Congress should act “decisively” to rein in so-called patent trolls.

Grassley at a hearing Wednesday brought up several reforms to the litigation system that advocates have called for, including enhancing discovery and pleading requirements, increasing transparency and streamlining proceedings. 

He acknowledged critics who say broad changes could discourage legitimate patent litigation, but said stopping the problem of abusive litigation tactics would require aggressive action. 

“We do need to strike the right balance, but Congress should act decisively if we want to alleviate the problems that are harming businesses both big and small,” he said in his opening statement. 

Grassley is working on legislation with the ranking Democrat on the panel Patrick Leahy (D-Vt.), as well as Sen. John Cornyn (R-Texas) and Charles Schumer (D-N.Y.). 

The House has already re-introduced a patent proposal that was approved overwhelmingly last Congress, and Grassley said he was focused on “passing meaningful legislation that will provide a strong deterrent to those who prey on innocent businesses.”

During opening remarks, Leahy noted that the committee worked for months under his leadership last Congress to hammer out legislative text that found the right “balance.”

Along with the reforms Grassley mentioned, Leahy noted that draft legislation last Congress included reforms to demand letters as well as a provision that would prioritize lawsuits against manufacturers before end users, like retailers who use the manufacturer’s product. 

“Although the committee was not able to complete its work, we made significant progress on comprehensive draft legislation,” he said in prepared remarks. “I hope we can build on that work now to pass meaningful legislation into law.”

Leahy said stakeholders would also have to compromise because “nobody is going to get everything they want.”

Cornyn said patent legislation would not be worth passing without a fee shifting provision, which would have the loser of patent litigation pay the winner’s legal fees when the suit was found to be frivolous. 

Schumer called reform a “little oasis” of bipartisanship and was hopeful that legislation “will actually pass the Senate this year,” noting his work with Cornyn on a compromise last Congress. 

Reform stalled in the upper chamber last year after then-Majority Leader Harry Reid (D-Nev.) said he would not bring to the floor any proposal worked out in the committee. Some other Democrats, including Sen. Chris Coons (Del.), remain skeptical of broad reform, but they will have less clout in the debate now that Republicans control both chambers. 

Democratic Whip Dick Durbin (D-Ill.) came out strong against proposed reform during the Wednesday hearing. He said broad legislation would have a “chilling effect” on innovation. Citing a Government Accountability Office, he said patent trolls make up only about one in five patent lawsuits. The changes we be about a lot more than “clubbing trolls,” he said. 

“We are clubbing the filers of patent litigation,” Durbin said. 

— updated at 12 p.m.