The US International Trade Commission’s proposed rule requiring disclosure of third-party litigation funding in Section 337 investigations is intensifying scrutiny of who finances patent disputes and how those relationships influence enforcement strategy. The proposal would require complainants to disclose funders, ownership interests, and entities with control over litigation or settlement decisions, with the ITC arguing the changes would improve transparency, identify conflicts of interest, and clarify who truly stands behind patent assertions.
Many practitioners support the proposal, arguing that disclosure could expose hidden ownership structures, foreign involvement, and repeat litigation tactics often associated with non-practicing entities (NPEs). Jonathan Stroud, COO & CLO of Unified Patents, emphasized that transparency aligns with the ITC’s statutory purpose, stating: “Built into the statute is already this sense of, hey, we need to know who’s filing this and who we’re protecting.” Stroud also argued that opaque structures can complicate settlements and enable repeated litigation through subsidiaries and portfolio transfers.
Read the full article posted from MLex here: https://www.mlex.com/mlex/intellectual-property/articles/2477467/proposed-itc-transparency-rule-puts-litigation-funders-under-new-scrutiny
