Obama Speech Makes Vague Call for Patent Bill

Obama gives no details on possible support for Innovation Act.

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President Barack Obama encouraged legislators to pass a patent reform bill that would allow companies to spend less money on lawsuits, in his State of the Union address Tuesday night.

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President Barack Obama repeated his call for legislation that would allow tech companies to spend less money on "needless" patent infringement lawsuits that stifle research spending Tuesday during the State of the Union, but he did not weigh in on any solutions being debated by Congress.

"Let's pass a patent reform bill that allows our businesses to stay focused on innovation, not costly, needless litigation," Obama said, echoing previous statements he has made criticizing abusive patent litigation.

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Patent assertion entities sometimes use a poorly defined or expired patent on consumer technology to extort an out-of-court settlement from small businesses using that gear. The House passed the bipartisan Innovation Act aimed at defending the patent rights of inventors in December and limiting the frequency of abusive patent lawsuits.

Rep. Jason Chaffetz, R-Utah, one of the co-sponsors of the Innovation Act, was "surprised" Obama mentioned patent reform in the address, since the president has not indicated where he stands on that bill.

"It's fascinating he would say that in the State of the Union but not signal to Congress exactly what it is he wants," Chaffetz says. "I'm still scratching my head to figure out what it is he's looking for."

As the Innovation Act heads to the Senate, Democrats may debate the bill's "loser pays" model, which could limit the discretion of courts by requiring the losers of a patent lawsuit to pay the winning party's legal fees, with certain exceptions. Democratic members including House Judiciary Committee ranking member John Conyers, D-Mich., tried to amend that portion of the bill in November.

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House Judiciary Committee Chairman Bob Goodlatte, R-Va., who introduced the Innovation Act, issued a statement praising Obama for highlighting the issue. The practice known as patent trolling has been an issue with rare bipartisan support, even though parties may differ on the details of proposed solutions.

"Businesses both large and small are affected by this growing problem and the enactment of the Innovation Act is central to U.S. competiveness, job creation and our nation's future economic security," Goodlatte said. "I look forward to working with President Obama and the Senate to see that patent litigation reform legislation is signed into law."