The changes implemented by the America Invents Act (AIA) have made it so that the patent system needs to be approached in an entirely new way. Patent practitioners need to have a detailed understanding of how the AIA affects litigation, prosecution and post-grant proceedings. This article is the second of a three-part series. Read part one here.
Along with the additions of post-grant review practice, the America Invents Act (AIA) also significantly altered patent litigation. In typical pre-AIA litigation filed by non-practicing entities (what those in the industry refer to as “patent trolls”), a non-practicing entity would file a patent infringement suit against numerous defendants that had nothing in common, other than the fact that each had been accused of infringing the same patent. The implementation of the AIA altered the ability of plaintiffs to file one lawsuit against numerous defendants in situations such as these. Instead, joinder of defendants is now permitted only where the claims against the defendants arise out of “the same transaction, occurrence, or series of transactions, or occurrences relating to the making, using, importing into the United States, offering for sale, or selling the same accused product or process” and requires that questions of fact common to all defendants or counterclaim defendants arise in the same action.
Absent waiver, defendants may not be joined together in a patent infringement lawsuit based solely on allegations that they each have infringed the patents-in-suit. In reviewing the legislative history of the AIA, it is clear that non-practicing entities were the intended target of the new joinder provisions. As can be seen in today’s news, the landscape for patent troll litigation will potentially be altered in the near future, as politicians begin to see the effects of patent troll litigation on the likes of companies both big and small.
While the new AIA forbids one consolidated trial for co-defendants who do not meet the heightened joinder standard articulated above, the law does not address phases of litigation pre-trial. Courts in the Eastern District of Texas, for example, have severed defendants scheduled for trial, but have consolidated all other pretrial issues amongst the defendants, including discovery, as the courts did not wish to waste judicial resources in addressing common issues amongst the defendants.
In observing recent court rulings, the federal courts’ early run of pretrial consolidations suggests that pretrial life under the AIA for purposes of joinder may closely resemble the pretrial state of affairs before the AIA. It is important to note that even though defendants may be separated into single actions, multiple defendants can still coordinate defense strategy together.
Other than joinder, the AIA has also affected other important areas of patent litigation. For example, the AIA has amended 35 U.S.C. § 287 to permit virtual marking in order to provide the necessary notice to the public that what is for sale is patented. Now, a patentee who adds newly issued patents to a list that has been posted to a freely accessible website has provided the necessary notice markings, without having to make physical changes to the product or its labeling. Further, the AIA repealed the false-marking qui tam action and made it so that only the government and those who have suffered a “competitive injury” can sue a patentee under the false marking statute.
Also, the AIA amended 35 U.S.C. § 282 to repeal the best-mode defense. Finally, with the enactment of the AIA, the prior use defense is applicable to all utility patents, and failure to obtain the advice of counsel may not be evidence of willful infringement or induced infringement.
The above describes briefly how the AIA has affected patent litigation. In the next article of our three-part series, we will describe the effect the AIA has had on patent prosecution.