Bill Text: CA AJR9 | 2015-2016 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Patent reform.

Spectrum: Slight Partisan Bill (Democrat 46-22-1)

Status: (Passed) 2015-07-21 - Chaptered by Secretary of State - Res. Chapter 123, Statutes of 2015. [AJR9 Detail]

Download: California-2015-AJR9-Amended.html

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BILL NUMBER: AJR 9	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  MAY 7, 2015

INTRODUCED BY   Assembly Member Chang
    (   Coauthors:   Assembly Members 
 Baker,   Gallagher,   and Steinorth  
) 
    (   Coauthor:   Senator   Huff
  ) 

                        FEBRUARY 25, 2015

   Relative to patents.


	LEGISLATIVE COUNSEL'S DIGEST


   AJR 9, as amended, Chang. Patent reform.
   This measure would urge the President and the Congress of the
United States to craft a balanced and workable approach to reduce
incentives for and minimize  abusive and frivolous 
 unnecessary  patent litigation while ensuring that
legitimate patent enforcement rights are protected and maintained.
   Fiscal committee: no.



   WHEREAS, The principle of intellectual property is enshrined in
the United States Constitution, specifically under clause 8 of
Section 8 of Article I of the United States Constitution, which
empowers Congress to "promote the Progress of Science and useful
Arts, by securing for limited Times to Authors and Inventors the
exclusive Right to their respective Writings and Discoveries"; and
   WHEREAS, A robust patent system is critical to promote economic
growth and innovation and ensure just compensation for the labor and
proliferation of beneficial ideas and innovations; and
   WHEREAS, California accounts for 25 percent of the nation's
patents; and
   WHEREAS, The state recognizes and respects the importance of
patent protections and patent enforcement rights to driving continued
research, investment, technological innovation, and job creation
across multiple sectors of our economy; and
   WHEREAS, Small businesses depend on patents to secure investments,
and firms with fewer than 25 employees hold nearly one-quarter of
United States-held patents in innovative emerging technologies; and
   WHEREAS, Enforcement of legitimate patent rights is essential to
promoting an innovation environment that fuels economic growth; and
   WHEREAS, There is increasing concern about  abusive
 litigation by predatory Patent Assertion Entities (PAEs),
which are built on a rent-seeking business model that exploits the
patent legal system for financial gain without producing or
manufacturing anything of value for society; and
   WHEREAS, Many PAEs attain ambiguous patents with the sole intent
of filing patent infringement lawsuits. PAEs assert these patents
against businesses of all sizes and in all industries, often years
after the product has become standard and widely used; and
   WHEREAS, PAEs rarely earn successful judgments in court,
underscoring the questionable merits of these particular patent
cases. However, given the high cost and risks associated with patent
litigation, most defendants choose to settle in order to avoid
further financial loss. Indeed, many PAEs will offer royalty
settlements below market value in order to encourage settlement and
avoid trial; and
   WHEREAS, Predatory PAEs have a detrimental impact on the 
economy.   economy and innovation.  PAE activities
cost businesses $29 billion directly, mostly borne by  small
and medium   small- and medium-sized  businesses;
and 
   WHEREAS, The costs of frivolous patent lawsuits constrain
innovation by increasing the risk to investors and businesses of
introducing new products into the marketplace; and 
   WHEREAS, The growth of patent litigation is directly tied to
aggressive PAEs in recent years. In 2010, PAEs were responsible for
29 percent of patent litigation, and by 2012 PAEs represented 62
percent of all patent suits; and
   WHEREAS, The California economy is especially vulnerable to
 opportunistic litigation given a high proportion of
 lawsuits directed at information technology patents; and
   WHEREAS, Federal legislation is necessary to prevent and deter
abusive patent litigation; now, therefore, be it
   Resolved by the Assembly and the Senate of the State of
California, jointly, That the Legislature urges the President and the
Congress of the United States to craft a balanced and workable
approach to reduce incentives for and minimize  abusive and
frivolous   unnecessary  patent litigation while
ensuring that legitimate patent enforcement rights are protected and
maintained; and be it further
   Resolved, That the Chief Clerk of the Assembly transmit copies of
this resolution to the President and Vice President of the United
States, the Speaker and Minority Leader of the House of
Representatives, the Majority Leader and Minority Leader of the
Senate, and each member of the California delegation to the United
States Congress.