H.R. 7140: Customer Legal Ease and Relief Act

This bill, titled the Customer Legal Ease and Relief Act (CLEAR Act), aims to provide protections for retailers and end users from legal actions related to patent infringement. Here’s a breakdown of what the bill proposes:

1. Stay of Action Against Retailers and End Users

The bill introduces a new section to Chapter 29 of Title 35 of the United States Code, which governs patent law, specifically regarding how courts handle lawsuits alleging patent infringement against retailers or end users. Key points include:

• Stay of Action: If a lawsuit is filed for patent infringement, the court must pause the legal action against a retailer or end user under certain conditions:
  • The manufacturer of the product allegedly infringing the patent is involved in the lawsuit.
  • The retailer or end user does not manufacture, assemble, integrate, or modify the product in question.
  • The retailer or end user agrees to conditions that include accepting the outcome of the lawsuit involving the manufacturer.
• Conditions for Lifting the Stay: The hold on the lawsuit may be lifted if it becomes clear that the manufacturer cannot afford to pay any damages that may be awarded.
• Possible Financial Assurance: The court can require the end user or retailer to provide a financial bond or deposit funds if there is a likelihood that the manufacturer will not be able to pay damages.
• Use Stipulation: In certain cases, the court may require the retailer or end user to specify how they use the product in question, and limited discovery may be allowed to understand this usage.
• Time Limits: A request to stay the action must be made within specified time limits, generally within six months of key dates related to the litigation.

2. Definitions

The bill also provides definitions for several terms used throughout the text, including:

• Accused Instrumentality: This refers to any product or process that is allegedly infringing on a patent.
• End User: An entity that uses the product as intended and does not influence the manufacturer’s production.
• Manufacturer: An entity that produces or supplies the product in question.
• Retailer: An entity that sells consumer goods or services to the public.

3. Effective Date

The provisions of this bill would go into effect as soon as it becomes law and would apply to any legal actions initiated after the enactment.

Relevant Companies

• None found