Reference is to the bill as introduced.
Amend the bill, and if amended, by striking all after the enacting words and inserting:
/ SECTION 1. Chapter 75, Title 15 of the 1976 Code is amended by adding:
"Section 15-75-70.
(A) No person in this State, in regard
to patent ownership and potential patent infringement, may
intentionally interfere with the existing contractual relations
of another person or intentionally interfere with the
prospective contractual relations of another person. A person
aggrieved by another person's intentional interference with his
existing contractual relations or with his prospective
contractual relations has a cause of action in both instances
against that person and is entitled to compensatory damages and
injunctive relief, and additionally punitive damages as provided
by law.
(B) To successfully
maintain a cause of action for intentional interference with
existing contractual relations, it must be established that:
(1)
a contract existed that was subject to interference;
(2)
the act of interference was wilful and intentional;
(3)
the act itself was the person's disingenuous claim of
ownership of intellectual property;
(4)
the intentional act was the proximate cause of the injured
party's damage; and
(5)
actual damage or loss occurred.
(C) To successfully
maintain a cause of action for intentional interference with
prospective contractual relations, which is a separate cause of
action from that specified in subsection (B), it must be
established that:
(1)
a valid expectancy of a business relationship existed;
(2)
the person committing the act of interference
intentionally prevented a business relationship from occurring
with the purpose of harming the injured party; and
(3)
the act itself was the person's disingenuous claim of
ownership of intellectual property."
SECTION 2. Article 1, Chapter 5, Title 39 of the 1976 Code is amended by adding:
"Section 39-5-190.
(A) For purposes of this section:
(1)
'Demand letter' means a letter, email, or other
communication asserting or claiming that the target has engaged
in patent infringement.
(2)
'Target' means a South Carolina person or entity:
(a)
who has received a demand letter or against whom an
assertion or allegation of patent infringement has been
made;
(b)
who has been threatened with litigation or against whom a
lawsuit has been filed alleging patent infringement; or
(c)
whose customers have received a demand letter asserting
that the person's product, service, or technology has infringed
a patent.
(B) It is an unlawful
trade practice for a person or entity to make a bad faith
assertion of patent infringement. This offense is a violation
of Section 39-5-20.
(C) A court may
consider the following factors as evidence that a person has
made a bad faith assertion of patent infringement:
(1)
the demand letter does not contain the following
information:
(a)
the patent number;
(b)
the name and address of the patent owner or owners and
assignee or assignees, if any; and
(c)
factual allegations concerning the specific areas in which
the target's products, services, and technology infringe the
patent or are covered by the claims in the patent;
(2)
prior to sending the demand letter, the person fails to
conduct an analysis comparing the claims in the patent to the
target's products, services, and technology, or the analysis was
done but does not identify specific areas in which the products,
services, and technology are covered by the claims in the
patent;
(3)
the demand letter lacks the information described in item
(1), the target requests the information, and the person fails
to provide the information within a reasonable period of
time;
(4)
the demand letter demands payment of a license fee or
response within an unreasonably short period of time;
(5)
the person offers to license the patent for an amount that
is not based on a reasonable estimate of the value of the
license;
(6)
the claim or assertion of patent infringement is
meritless, and the person knew, or should have known, that the
claim or assertion is meritless;
(7)
the claim or assertion of patent infringement is
deceptive;
(8)
the person or its subsidiaries or affiliates have
previously filed or threatened to file one or more lawsuits
based on the same or similar claim of patent infringement
and:
(a)
those threats or lawsuits lacked the information described
in item (1); or
(b)
the person attempted to enforce the claim of patent
infringement in litigation and a court found the claim to be
meritless; and
(9)
any other factor the court finds relevant.
(D) A court may
consider the following factors as evidence that a person has not
made a bad faith assertion of patent infringement:
(1)
the demand letter contains the information described in
subsection (C)(1);
(2)
where the demand letter lacks the information described in
subsection (C)(1) and the target requests the information, the
person provides the information within a reasonable period of
time;
(3)
the person engages in a good faith effort to establish
that the target has infringed the patent and to negotiate an
appropriate remedy;
(4)
the person makes a substantial investment in the use of
the patent or in the production or sale of a product or item
covered by the patent;
(5)
the person is:
(a)
the inventor or joint inventor of the patent or, in the
case of a patent filed by and awarded to an assignee of the
original inventor or joint inventor, is the original assignee;
or
(b)
an institution of higher education or a technology
transfer organization owned or affiliated with an institution of
higher education;
(6)
the person has:
(a)
demonstrated good faith business practices in previous
efforts to enforce the patent, or a substantially similar
patent; or
(b)
successfully enforced the patent, or a substantially
similar patent, through litigation; and
(7)
any other factor the court finds relevant.
(E) Upon motion by a
target and a finding by the court that a target has established
a reasonable likelihood that a person has made a bad faith
assertion of patent infringement in violation of this section,
the court shall require the person to post a bond in an amount
equal to amounts reasonably likely to be recovered pursuant to
Section 39-5-140, conditioned upon payment of any amounts
finally determined to be due to the target. A hearing shall be
held if either party so requests. A bond ordered pursuant to
this section shall not exceed two hundred fifty thousand
dollars. The court may waive the bond requirement if it finds
the person has available assets equal to the amount of the
proposed bond or for other good cause shown.
(F)(1) The Attorney
General has the same authority to act on a violation of this
section as is provided in this chapter.
(2)
This section shall not be construed to limit rights and
remedies available to the State or to any person under any other
law and shall not alter or restrict the Attorney General's
authority with regard to conduct involving assertions of patent
infringement.
(G) A target of conduct
involving assertions of patent infringement, or a person
aggrieved by a violation of this chapter may bring an action for
relief. A court may award remedies to a target who prevails in
an action brought pursuant to this chapter.
(H) A demand letter or
assertion of patent infringement that includes a claim for
relief arising under 35 U.S.C. Section 271(e)(2) or 42 U.S.C.
Section 262 shall not be subject to the provisions of this
chapter."
SECTION 3. This act takes effect upon approval by the Governor. /
Renumber sections to conform.
Amend title to conform.