An underhanded tactic used for some time by shady Amazon sellers has been to file a bogus patent infringement claim against another seller, taking them out of action for several weeks or months while they resolve the claim.

Amazon’s false Claims between sellers

New rules in 2020

An underhanded tactic used for some time by shady Amazon sellers has been to file a bogus patent infringement claim against another seller, taking them out of action for several weeks or months while they resolve the claim. 

A new beta program that Amazon has devised called the Utility Patent Neutral Evaluation program works to resolve this issue whereby a utility patent owner and accused seller can have their case investigated by a neutral third-party evaluator with expertise in law and utility patents. So far it looks like an effective change to the current system which is prone to misuse.  

The current process

The current system allows baseless patent infringement claims to flourish, since Amazon requires the affected seller to work directly contact the patent owner and work through the issues between themselves. In the meantime, the product in question is removed from Amazon’s site.

The first issue with this system is that Amazon generally does not want to get involved in these disputes, forcing the seller to commence a federal court action requesting a declaration the product does not infringe the asserted patent.  Mark Rosenberg, an Intellectual Property Attorney at Tarter Krinsky & Drogin has represented several parties in Amazon’s new program. He says that not only is the current litigation option expensive, there is a high likelihood that the patent owner will file a counterclaim for infringement and damages based on the sales of the accused product.

The second issue with the current process is that often these claims are not made “in good faith”. Rosenberg says that unscrupulous patent owners are aware of the undesirable chain of events that kicks off with a patent infringement assertion, and use this to their advantage by making meritless claims, resulting in the competitor’s product being taken down and no desirable recourse.

Read the full article on this page to know what is expected in 2020: https://www.forbes.com/sites/kirimasters/2019/09/30/amazons-new-utility-patent-neutral-evaluation-process-stops-bogus-ip-claims/

Source:

Kiri Masters

Kiri Masters – Contributor Retail – cover online marketplaces from a retail brand’s perspective.