Abandonment of FRCP Forms may Reign in Patent Trolls
A change to the Federal Rules of Civil Procedure will make it harder for patent trolls to initiate patent infringement suits against unsuspecting target companies. On Tuesday, September 16th, the Judicial Conference of the United States voted to abolish Rule 84 of the Federal Rules of Civil Procedure, which designate what forms are sufficient for pleading, including Form 18: Complaint for Patent Infringement. If the Supreme Court and Congress approve the change, patent trolls will have to make specific allegations of patent infringement, rather than simply accusing targets of stealing their inventions.Unless and until the rule changes, most courts including the Federal Circuit, the appellate court for patent disputes, will continue to use the less stringent standards under Form 18 to determine whether a complaint can survive a motion to dismiss. If adopted, Form 18 would no longer govern patent disputes and litigants might be held to stricter pleading standards under the Supreme Court’s Iqbal and Twombly decisions (known collectively as Twiqbal). Twiqbal requires plaintiffs to “state more than bare allegations to survive a motion to dismiss,” according to Forbes. Currently, Form 18 requires litigants to do little more than list the names of the parties involved and the date the patent in question was issued.
Patent trolls—formally referred to as Non-Practicing Entities (NPEs)—are organizations that obtain patents for the sole purpose of enforcing their rights to patents, but have little or no ability to practice the patent inventions. The most offensive ones send settlement letters en masse in hopes of inspiring alleged infringers to settle from fear of possible litigation. Forbes recently reported, one reason why NPEs are so successful at this is that the Federal Rules of Civil Procedure hold the pleading standard for patent cases below that of Twiqbal. The form requires only the name of the plaintiff, the date the patent was issued, and the name of the accused. Twiqbal, on the other hand, requires more than “bare allegations” and would presumably require naming each product and specifically stating how it infringes.
If the higher standard is adopted, patent trolls will have to replace their “shotgun approached” with a much more targeted one. A form-letter would be insufficient to scare a defendant into settling, and the NPEs would have a less workable business model.