10-1-771. Bad faith assertion of patent infringement prohibited; factors for determining bad faith.

A person shall not make a bad faith assertion of patent infringement.#

A court may consider the following factors as evidence that a person has made a bad faith assertion of patent infringement:#

1. (1)

   The demand letter does not contain the following information:#

   1. (A)

      The patent number;#

   2. (B)

      The name and address of the patent owner or owners and assignee or assignees, if any; and#

   3. (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. (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 such an 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. (3)

   The demand letter lacks the information described in paragraph (1) of this subsection, the target requests such information, and the author of the demand letter fails to provide such information within a reasonable period of time;#

4. (4)

   The demand letter demands payment of a license fee or response within an unreasonably short period of time;#

5. (5)

   The person offers to license the patent for an amount that is not based on a reasonable estimate of the value of the patent;#

6. (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. (7)

   The claim or assertion of patent infringement is deceptive;#

8. (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:#

   1. (A)

      Those threats or lawsuits lacked the information described in paragraph (1) of this subsection; or#

   2. (B)

      The person attempted to enforce the claim of patent infringement in litigation, and a court found the claim to be meritless; or#

9. (9)

   Any other factor the court finds relevant.#

A court may consider the following factors as evidence that a person has not made a bad faith assertion of patent infringement:#

1. (1)

   The demand letter contains the information described in paragraph (1) of subsection (b) of this Code section;#

2. (2)

   Where the demand letter lacks the information described in paragraph (1) of subsection (b) of this Code section and the target requests the information, the author of the demand letter provides the information within a reasonable period of time;#

3. (3)

   The author of the demand letter engages in a good faith effort to establish that the target has infringed the patent and to negotiate an appropriate remedy;#

4. (4)

   The author of the demand letter 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. (5)

   The author of the demand letter is:#

   1. (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#

   2. (B)

      An institution of higher education or a technology transfer organization owned or affiliated with an institution of higher education;#

6. (6)

   The author of the demand letter has:#

   1. (A)

      Demonstrated good faith business practices in previous efforts to enforce the patent, or a substantially similar patent; or#

   2. (B)

      Successfully enforced the patent, or a substantially similar patent, through litigation; or#

7. (7)

   Any other factor the court finds relevant.#