Understanding the Impact of the PREVAIL Act on Patent Rights

The recent developments in patent legislation have stirred considerable debate within the tech community and beyond. While there was a notable sigh of relief with the Senate Judiciary Committee dropping the Patent Eligibility Restoration Act (PERA), the ongoing support for the PREVAIL Act raises significant concerns. This bill, if passed, could severely undermine the United States’ most effective system for invalidating questionable patents, ultimately benefiting patent trolls at the expense of innovators and the public.

One of the critical mechanisms for combating poor patents is the inter partes review (IPR) process, established by Congress in 2011. This system was designed to address a substantial issue: many invalid patents slip through the cracks at the U.S. Patent and Trademark Office (USPTO). While navigating the IPR process can be complex, it is significantly more cost-effective and quicker than pursuing invalid patents in federal court. This is particularly crucial for small businesses and individuals who rely on IPR for protection.

It is important to note that over 85% of tech-related patent lawsuits are initiated by non-practicing entities—commonly referred to as “patent trolls.” These companies do not produce their own products or services; instead, they file numerous patent claims against others, often seeking settlements. As a result, tech companies frequently target these patent trolls with IPR challenges, which help eliminate patents that lack legitimacy.

A pertinent example of IPR’s effectiveness can be seen in Apple’s victory over the patent troll Ameranth. Ameranth had asserted rights over using mobile devices to order food, launching lawsuits against over 100 restaurants and other establishments. Thanks to the IPR process, Apple successfully invalidated this patent, effectively putting an end to Ameranth’s unfounded legal actions.

The PREVAIL Act presents a worrying shift in this landscape. One of its most concerning provisions is that it would restrict the ability of organizations like the Electronic Frontier Foundation (EFF) from filing patent challenges. EFF has played a crucial role in fighting patents that pose a threat to the public interest. For instance, in 2013, Personal Audio LLC claimed it held the patent for podcasting and sought licensing fees from various podcasters. EFF rallied community support and successfully challenged this patent through IPR, proving its invalidity all the way to the Supreme Court.

Should the PREVAIL Act become law, it would limit IPR petitions to those directly targeted by a patent owner, effectively sidelining organizations like EFF that advocate for broader public rights. This means that countless individuals and businesses indirectly affected by harmful patents, such as podcasters threatened by Personal Audio, would lose their ability to defend themselves.

Moreover, the PREVAIL Act would create an environment that favors patent trolls, making it easier for them to pursue their claims. It is concerning that the Senate Judiciary Committee is prioritizing a bill that erodes the rights of innovators and the public in the final hours of the legislative session. Patent trolls often target individuals and small businesses simply for utilizing everyday technology, and everyone should retain the right to challenge invalid patents.

Now is the time for action. Individuals and organizations who value a fair patent system must voice their opposition to the PREVAIL Act. Everyone who meets the legal criteria for an IPR filing should have the opportunity to challenge invalid patents. The rights we have fought for in the patent system are not something we should relinquish lightly.

If you are concerned about the implications of the PREVAIL Act, consider reaching out to Congress through our action center to express your views. It’s essential that lawmakers understand the potential consequences of this bill on both innovators and the public at large.

For more information on the PREVAIL Act and its ramifications, you can explore resources such as EFF’s blog, which delves deeper into how this legislation could harm public interests, and coalition letters opposing the bill.