1. (1) A person may not make assertions of patent infringement in bad faith.

2. (2) A court may consider the following nonexclusive factors as evidence that a person has made an assertion of patent infringement in bad faith:

   1. (a) The demand does not contain:

      1. (i) The patent number or numbers issued by the United States patent office or foreign agency;
      2. (ii) The name and address of the patent owner or owners or assignee or assignees, if any; and
      3. (iii) Factual allegations relating to the specific areas in which the target's product, service, or technology infringes the patent or is covered by the claims in the patent;
   2. (b) The target requested the information described in (a) of this subsection, and the person failed to provide the information within a reasonable time;
   3. (c) Before making a demand, the person did not conduct any analysis comparing the claims in the patent to the target's product, service, or technology;
   4. (d) The person threatens legal action that cannot legally be taken;
   5. (e) The assertion of patent infringement contains false, misleading, or deceptive information;
   6. (f) The person, or a subsidiary or an affiliate of the person, has previously filed or threatened to file one or more lawsuits based on the same or substantially equivalent assertion of patent infringement, and a court found the person's assertion to be without merit or found the assertion contains false, misleading, or deceptive information; or
   7. (g) Any other factor the court determines to be relevant.
3. (3) Nothing in the demand letter or patent assertion may be used to move for declaratory judgment in underlying patent infringement litigation.

4. (4) A court may consider the following factors as evidence that a person has made an assertion of patent infringement in good faith:

   1. (a) If the demand does not contain the information set forth in subsection (2)(a) of this section, the person provides the information to the target within a reasonable period of time after such information is requested by the target;

   2. (b) The person has:

      1. (i) Engaged in reasonable analysis to establish a reasonable, good faith basis for believing the target has infringed the patent; and
      2. (ii) Attempted to negotiate an appropriate remedy in a reasonable manner;

   3. (c) The person has:

      1. (i) Demonstrated reasonable business practices in previous efforts to enforce the patent; or
      2. (ii) Successfully enforced the patent, or a substantially similar patent, through litigation;
   4. (d) The person has made a substantial investment in the use of the patent or in the production or sale of a product covered by the patent;

   5. (e) The person is:

      1. (i) An inventor of the patent or an original assignee;
      2. (ii) An institution of higher education or a technology transfer organization affiliated with an institution of higher education; or
      3. (iii) Any owner or licensee of a patent who is using the patent in connection with substantial research, development, production, manufacturing, processing, or delivery of products or materials; or
   6. (f) Any other factor the court determines to be relevant.

5. (5) Unless done in bad faith, nothing in this section may be construed to deem it an unfair or deceptive trade practice for any person who owns or has the right to license or enforce a patent to:

   1. (a) Advise others of that ownership or right of license or enforcement;
   2. (b) Communicate to others that the patent is available for license or sale; or
   3. (c) Seek compensation on account of a past or present infringement, or license to the patent, when it is reasonable to believe that the person from whom compensation is sought may owe such compensation or may need or want such a license to practice the patent.
6. (6) The provisions of chapter 108, Laws of 2015 do not apply to a demand letter or civil action that includes a claim for relief arising under 35 U.S.C. Sec. 271(e)(2), 7 U.S.C. Sec. 136, 7 U.S.C. Sec. 2321, 21 U.S.C. Sec. 301, 35 U.S.C. Sec. 161, 42 U.S.C. Sec. 262, or 35 U.S.C. Sec. 287.

[ 2015 c 108 s 3.]