When the America Invents Act ("AIA ") was signed in September 2011, many feared the law might benefit larger corporations at the expense of small businesses. This Note examines how one portion of the AIA, governing joinder in patent cases, might actually benefit small businesses by reducing patent assertions from non-practicing entities ("NPEs"). NPE assertions disproportionately affect small businesses, both because NPEs target small businesses more frequently and because patent assertions have a greater impact on individual companies. Prior to the AIA, joining multiple defendants in a single lawsuit offered important advantages for patent holders and allowed NPEs to achieve a profitable economy of scale by targeting small businesses. The AIA, on the other hand, imposes a higher standard for joinder, changing both the litigation and economic dynamics of asserting patents against multiple defendants. Over the long run, the new joinder provision will likely reduce patent assertions against small businesses by increasing costs for NPEs and removing the litigation advantages of joining multiple defendants. This Note will also discuss how NPEs might adapt their assertion strategy in light of the joinder provision, as well as why some NPEs may continue to litigate against small companies, even at a short-term financial loss.
Joinder under the AIA: Shifting Non-Practicing Entity Patent Assertions away from Small Businesses,
Mich. Telecomm. & Tech. L. Rev.
Available at: http://repository.law.umich.edu/mttlr/vol19/iss2/6