Sec. 5. Customer-suit exception
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/bill/114/hr/9/rh/section-5A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Section 296 of title 35, United States Code, is amended to read as follows: In this section: The term covered customer means a retailer or end user that is accused of infringing a patent or patents in dispute based on— the sale, or offer for sale, of a covered product or covered process without material modification of the product or process in a manner that is alleged to infringe a patent or patents in dispute; or the use by such retailer, the retailer’s end user customer, or an end user of a covered product or covered process without material modification of the product or process in a manner that is alleged to infringe a patent or patents in dispute.
The term covered manufacturer means a person that manufactures or supplies, or causes the manufacture or supply of, a covered product or covered process, or a relevant part thereof. The term covered process means a process, method, or a relevant part thereof, that is alleged to infringe a patent or patents in dispute where such process, method, or relevant part thereof is implemented by an apparatus, material, system, software, or other instrumentality that is provided by the covered manufacturer.
The term covered product means a product, system, service, component, material, or apparatus, or relevant part thereof, that— is alleged to infringe a patent or patents in dispute; or implements a process alleged to infringe the patent or patents in dispute. The term end user includes an affiliate of an end user, but does not include an entity that manufacturers or causes the manufacture of a covered product or covered process, or a relevant part thereof. The term retailer means an entity that generates revenues predominately through the sale to the public of consumer goods or services, or an affiliate of such entity, but does not include an entity that manufacturers or causes the manufacturer of a covered product or covered process, or a relevant part thereof.
Except as provided in subsection (d), in any civil action in which a party asserts a claim for relief arising under any Act of Congress relating to patents, the court shall grant a motion to stay at least the portion of the action against a covered customer related to infringement of a patent involving a covered product or covered process if the following requirements are met: The covered manufacturer is a party to the action or to a separate action (in which a party asserts a claim for relief arising under any Act of Congress relating to patents) involving the same patent or patents related to the same covered product or covered process.
The covered customer agrees to be bound as to issues determined in an action described in paragraph
(1)without a full and fair opportunity to separately litigate any such issue, but only as to those issues for which all other elements of the common law doctrine of issue preclusion are met. The motion is filed after the first pleading in the action but not later than the later of— the 120th day after the date on which the first pleading or paper in the action is served that specifically identifies the covered product or covered process as a basis for the covered customer’s alleged infringement of the patent and that specifically identifies how the covered product or covered process is alleged to infringe the patent; or the date on which the first scheduling order in the case is entered. In a case in which the covered manufacturer has been made a party to the action on motion by the covered customer, the covered manufacturer and the covered customer consent in writing to the stay. A stay entered under this section may be lifted upon grant of a motion based on a showing that— the action involving the covered manufacturer will not resolve a major issue in the suit against the covered customer (such as a covered product or covered process identified in the motion to lift the stay is not a material part of the claimed invention or inventions in the patent or patents in dispute); or the stay unreasonably prejudices or would be manifestly unjust to the party seeking to lift the stay. In the case of a stay entered under this section based on the participation of the covered manufacturer in a separate action described in subsection (b)(1), a motion under paragraph
(1)may only be granted if the court in such separate action determines that the showing required under paragraph
(1)has been made. This section shall not apply to an action that includes a cause of action described under section 271(e)(2). The court may, upon motion, determine that a consent judgment or an unappealed final order shall not be binding on the covered customer with respect to one or more of the issues that gave rise to the stay based on a showing that such consent judgment or unappealed final order would unreasonably prejudice or be manifestly unjust to the covered customer in light of the circumstances of the case if, following the grant of a motion to stay under this section, the covered manufacturer described in subsection (b)(1)— obtains or consents to entry of a consent judgment relating to such issue that gave rise to the stay; or fails to prosecute to a final, non-appealable judgment such issue that gave rise to the stay. Nothing in this section shall be construed to limit the ability of a court to grant any stay, expand any stay granted under this section, or grant any motion to intervene, if otherwise permitted by law. . The table of sections for chapter 29 of title 35, United States Code, is amended by striking the item relating to section 296 and inserting the following: 296. Stay of action against customer. . The amendments made by this section shall take effect on the date of the enactment of this Act and shall apply to any action for which a complaint is filed on or after the first day of the 30-day period that ends on that date.