Collins statement on U.S. Patent and Trademark Office subcommittee hearing

"We cannot sit back and continue to watch our mighty patent system, a key driver of innovation in this country, continue to slide. . . . I want to know how a patent eligibility test should be crafted to promote investment in important technology industries, while avoiding a resurgence of patent litigation abuse."

WASHINGTON — Rep. Doug Collins (R-Ga.), Ranking Member of the House Judiciary Committee, issued the following statement ahead of the U.S. Patent and Trademark Office (PTO) subcommittee hearing. Below are the remarks as prepared. Ranking Member Collins: Thank you, Mr. Chairman, and thank you, Director Iancu, for testifying before the committee today. We greatly value the important work that you are doing at the PTO. Just two weeks ago, we celebrated World IP day. Participating in those events made me realize something troubling: Today, our inventors have less reason to celebrate the U.S. patent system and more reason for concern. Over the last decade or so, Congress and the courts have made dozens of changes to the patent system to address patent litigation abuse. I supported most of those changes, but combined, these numerous changes have created an unhealthy patent system. We have overcorrected. For many, these changes have created an environment in which patents fail to provide any confidence that investments in R&D will be protected. I fear that, although well intended, these changes have replaced a “patent litigation abuse problem” with one that poses an even greater risk to the economy — a patent uncertainty problem. I fear that our weakened patent system makes it much harder to justify decisions to invest in new technologies. Because patents are less likely to survive a challenge in district court or the PTAB, and I also fear that we have created an environment where it is safer to steal a technology developed by small businesses than to pay for it. Two areas of patent law are of greatest concern to me. First, the U.S. Supreme Court’s recent cases rewriting the patent eligibility test have created tremendous uncertainty about whether certain types of patents will stand up in court. Director Iancu has described the U.S. Supreme Court’s test as a “tortured exercise” and has called on the courts and Congress to fix it. There are now several opinions issued by the U.S. Court of Appeals for the Federal Circuit, the highest patent court in the land, next to the Supreme Court, in which at least five of the expert judges there complain that the test is flawed and must be replaced. We cannot sit back and continue to watch our mighty patent system, a key driver of innovation in this country, continue to slide. That is why I am working with several colleagues in the House and Senate, including my friend Chairman Johnson and numerous stakeholders, to investigate and develop a patent eligibility test that works for all. Another area within the patent system that requires our close attention is the PTO’s implementation of inter partes review (IPRs) proceedings. It has been eight years since we established those proceedings, and they have been both heralded and vilified. Many are happy to avoid a costly patent dispute in federal court, and instead rely on the PTAB to quickly and less expensively invalidate an accuser’s patent. But others argue that the PTO has implemented countless rules skewed against patent owners that result in good patents being struck down in bad IPR decisions. I have heard numerous reports that defendants in litigation are filing multiple similar attacks on the same patent or using surrogates to skirt prohibitions against repeat attacks. I also have learned of instances where small businesses sought to assert their patents in federal court to stop the theft of their most valuable intellectual property. Those thieves instead forced the small businesses to defend their patents before the PTAB, which issued a questionable decision invalidating their patents. Fortunately, some of these small innovative companies can afford to appeal the PTAB’s flawed decisions and have their patents restored by the Federal Circuit. This demonstrates that well-funded companies can use PTAB proceedings to harass small businesses into submission. The cost of appealing a bad PTAB decision may be too much for most small businesses to bear, resulting in loss of their patents, innovations and business, at the hands of an unscrupulous copycat. In this hearing, I want to hear from Director Iancu on both of these concerns. I want to know how a patent eligibility test should be crafted to promote investment in important technology industries, while avoiding a resurgence of patent litigation abuse. I also want to hear from him on whether the PTO is doing everything it can to implement AIA proceedings in a manner that is fair to patent owner and petitioner alike and what, if any, changes Congress should make to those proceedings. I also want to hear from Director Iancu on the issue of mass foreign filings of trademark applications containing fraudulent assertions of use. I look forward to delving into these very important issues.