FACT SHEET: White House Task Force on High-Tech Patent Issues | T...
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`The White House
`Office of the Press Secretary
`
`For Immediate Release
`
`June 04, 2013
`
`FACT SHEET: White House Task Force on High-Tech
`Patent Issues
`
`LEGISLATIVE PRIORITIES & EXECUTIVE ACTIONS
`
`Today the White House announced major steps to improve incentives for future innovation in high tech patents, a
`key driver of economic growth and good paying American jobs. The White House issued five executive actions and
`seven legislative recommendations designed to protect innovators from frivolous litigation and ensure the highest-
`quality patents in our system. Additionally, the National Economic Council and the Council of Economic Advisers
`released a report, Patent Assertion and U.S. Innovation, detailing the challenges posed and necessity for bold
`legislative action.
`
`In 2011, the President signed the Leahy-Smith America Invents Act (AIA), a landmark piece of legislation designed
`to help make our patent system more efficient and reliable. As technology evolves more rapidly than ever, we must
`ensure our patent system keeps pace. As President Obama said in February, “our efforts at patent reform only
`went about halfway to where we need to go. What we need to do is pull together additional stakeholders and see if
`we can build some additional consensus on smarter patent laws.”
`
`The AIA put in place new mechanisms for post-grant review of patents and other reforms to boost patent quality.
`Meanwhile, court decisions clarifying the scope of patentability and guidelines implementing these decisions
`diminish the opportunity to game the patent and litigation systems. Nevertheless, innovators continue to face
`challenges from Patent Assertion Entities (PAEs), companies that, in the President’s words “don’t actually produce
`anything themselves,” and instead develop a business model “to essentially leverage and hijack somebody else’s
`idea and see if they can extort some money out of them.” These entities are commonly known as “patent trolls.”
`Likewise, the so-called “Smartphone Patent Wars” have ballooned in recent years and today, several major
`companies spend more on patent litigation and defensive acquisition than on research and development.
`
`Stopping this drain on the American economy will require swift legislative action, and we are encouraged by the
`attention the issue is receiving in recent weeks. We stand ready to work with Congress on these issues crucial to
`our economy, American jobs, and innovation. While no single law or policy can address all these issues, much can
`and should be done to increase clarity and level the playing field for innovators.
`
`LEGISLATIVE RECOMMENDATIONS
`
`In that spirit, the Administration recommends that Congress pursue at least seven legislative measures that
`would have immediate effect on some major problems innovators face. These measures would:
`
`1.
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`2.
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`3.
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`4.
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`Require patentees and applicants to disclose the “Real Party-in-Interest,” by requiring that any party
`sending demand letters, filing an infringement suit or seeking PTO review of a patent to file updated ownership
`information, and enabling the PTO or district courts to impose sanctions for non-compliance.
`
`Permit more discretion in awarding fees to prevailing parties in patent cases, providing district courts with
`more discretion to award attorney’s fees under 35 USC 285 as a sanction for abusive court filings (similar to the
`legal standard that applies in copyright infringement cases).
`
`Expand the PTO’s transitional program for covered business method patents to include a broader category of
`computer-enabled patents and permit a wider range of challengers to petition for review of issued patents before
`the Patent Trial and Appeals Board (PTAB).
`
`Protect off-the-shelf use by consumers and businesses by providing them with better legal protection
`against liability for a product being used off-the-shelf and solely for its intended use. Also, stay judicial
`proceedings against such consumers when an infringement suit has also been brought against a vendor,
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`4/25/2014 12:23 AM
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`Medtronic and Medtronic Vascular
`Exhibit 1014 - Page 1
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`FACT SHEET: White House Task Force on High-Tech Patent Issues | T...
`
`http://www.whitehouse.gov/the-press-office/2013/06/04/fact-sheet-white...
`
`retailer, or manufacturer.
`
`5.
`
`Change the ITC standard for obtaining an injunction to better align it with the traditional four-factor test in
`eBay Inc. v. MercExchange, to enhance consistency in the standards applied at the ITC and district courts.
`
`6.
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`Use demand letter transparency to help curb abusive suits, incentivizing public filing of demand letters in a
`way that makes them accessible and searchable to the public.
`
`7.
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`Ensure the ITC has adequate flexibility in hiring qualified Administrative Law Judges.
`
`EXECUTIVE ACTIONS
`
`Today the Administration is also announcing a number of steps it is taking to help bring about greater
`transparency to the patent system and level the playing field for innovators. Those steps include:
`
`1.
`
`2.
`
`3.
`
`4.
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`5.
`
`Making “Real Party-in-Interest” the New Default. Patent trolls often set up shell companies to hide their
`activities and enable their abusive litigation and extraction of settlements. This tactic prevents those facing
`litigation from knowing the full extent of the patents that their adversaries hold when negotiating settlements, or
`even knowing connections between multiple trolls. The PTO will begin a rulemaking process to require patent
`applicants and owners to regularly update ownership information when they are involved in proceedings before
`the PTO, specifically designating the “ultimate parent entity” in control of the patent or application.
`
`Tightening Functional Claiming. The AIA made important improvements to the examination process and
`overall patent quality, but stakeholders remain concerned about patents with overly broad claims — particularly
`in the context of software. The PTO will provide new targeted training to its examiners on scrutiny of functional
`claims and will, over the next six months develop strategies to improve claim clarity, such as by use of glossaries
`in patent specifications to assist examiners in the software field.
`
`Empowering Downstream Users. Patent trolls are increasingly targeting Main Street retailers, consumers and
`other end-users of products containing patented technology — for instance, for using point-of-sale software or a
`particular business method. End-users should not be subject to lawsuits for simply using a product as intended,
`and need an easier way to know their rights before entering into costly litigation or settlement. The PTO will
`publish new education and outreach materials, including an accessible, plain-English web site offering answers
`to common questions by those facing demands from a possible troll.
`
`Expanding Dedicated Outreach and Study. Challenges to U.S. innovation using tools available in the patent
`space are particularly dynamic, and require both dedicated attention and meaningful data. Engagement with
`stakeholders — including patent holders, research institutions, consumer advocates, public interest groups, and
`the general public — is also an important part of our work moving forward. Roundtables and workshops that the
`PTO, DOJ, and FTC have held in 2012 have offered invaluable input to this process. We are announcing an
`expansion of our outreach efforts, including six months of high-profile events across the country to develop new
`ideas and consensus around updates to patent policies and laws. We are also announcing an expansion of the
`PTO Edison Scholars Program, which will bring distinguished academic experts to the PTO to develop — and
`make available to the public — more robust data and research on the issues bearing on abusive litigation.
`
`Strengthen Enforcement Process of Exclusion Orders. Once the U.S. International Trade Commission (ITC)
`finds a violation of Section 337 and issues an exclusion order barring the importation of infringing goods,
`Customs and Border Protection (CBP) and the ITC are responsible for determining whether imported articles fall
`within the scope of the exclusion order. Implementing these orders present unique challenges given these
`shared responsibilities and the complexity of making this determination, particularly in cases in which a
`technologically sophisticated product such as a smartphone has been successfully redesigned to not fall within
`the scope of the exclusion order. To address this concern, the U.S. Intellectual Property Enforcement
`Coordinator will launch an interagency review of existing procedures that CBP and the ITC use to evaluate the
`scope of exclusion orders and work to ensure the process and standards utilized during exclusion order
`enforcement activities are transparent, effective, and efficient.
`
`L A T E S T B L O G P O S T S
`
`April 23, 2014 9:00 PM EDT
`President Obama Speaks at the Miraikan
`Science Expo
`President Obama visits the National Museum of
`Emerging Science and Innovation in Tokyo and
`delivers remarks at an event for youth in science.
`
`April 23, 2014 12:54 PM EDT
`Helping Employers Connect to Job Seeking
`Service Members, Veterans and Their
`Families
`Companies who have made commitments to
`Joining Forces have hired over half a million
`(540,000) veterans and military spouses.
`Commitments from America’s biggest firms like
`UPS, who announced a doubling of their
`commitment to 50,000 new hires and Xerox who
`will has committed to hire 10,000 veterans and
`spouses over the next five years.
`
`April 22, 2014 5:59 PM EDT
`Recognizing Green Schools on Earth Day
`To celebrate Earth Day, U.S. Secretary of
`Education Arne Duncan announces the 2014 U.S.
`Department of Education Green Ribbon Schools
`(ED-GRS) and District Sustainability Award
`recipients.
`
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`2 of 3
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`4/25/2014 12:23 AM
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`Medtronic and Medtronic Vascular
`Exhibit 1014 - Page 2
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`FACT SHEET: White House Task Force on High-Tech Patent Issues | T...
`
`http://www.whitehouse.gov/the-press-office/2013/06/04/fact-sheet-white...
`
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`4/25/2014 12:23 AM
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`Medtronic and Medtronic Vascular
`Exhibit 1014 - Page 3
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