Under 28 USC § 1338(a), federal courts have exclusive jurisdiction over cases “arising under any Act of Congress relating to patents.” However, there are still aspects governed by Florida-specific patent laws. These include areas such as ownership, assignment, frivolous filings, malpractice, university preeminence, tax revenue and others. For example, here are just some laws specific to patents in Florida:
Protection against Patent Trolls
As a matter of fact, a substantial number of patents are litigated in Florida. Accordingly, the federal court judges are well-versed on claim construction, Markman hearings and patent validity matters. Moreover, Florida provides additional remedies for frivolous patent claims in its Patent Troll Statute. F.S. 501.993 Significantly, these include an additional punitive damage award of $75,000 in addition to other remedies.
Patents and Florida Universities
Certainly, Florida Universities receiving federal funding already have patenting mandates from the Bayh-Dole Act of 1980. However, Florida has some additional patent provisions directly related to its university system.
- Florida Universities are authorized to obtain, license, sell, and enforce patents. F.S. 1004.23. Specifically, the technology transfer departments of Florida universities grant hundreds of new patents each year. Accordingly, these patents are licensed to private industry generating royalties to support additional research.
- Florida universities seeking preeminence to obtain one hundred (100) or more U.S. patents for the most recent 3-year period. F.S. 1001.7065.
- Total patents awarded a factor in determining university tuition rates. F.S. 1009.24.
Florida Government Agencies Authorized to Seek Patents:
In addition, these government organizations in Florida are expressly authorized to secure patents and license the technology for royalties.
- Florida Department of Transportation. F.S. 334.049.
- Florida Department of the Lottery. F.S. 24.105.
- Florida State Board of Administration. F.S. 215.4701.
- Florida Department of Law Enforcement. F.S. 943.146.
- Florida Water Districts. F.S. 373.608.
- Florida Department of Agriculture. F.S. 570.07.
- Florida Department of State. F.S. 286.021.
- Space Florida. F.S. 331.355.
- Florida Institute for Human and Machine Cognition. F.S. 1004.447.
- Handling of patented educational materials produced through State Board of Education. F.S. 1006.39.
- Like NASA and the Department of Energy, the Florida Department of Citrus owns patent rights developed by its department. F.S. 601.101.
Florida Tax Handling of Patents:
Florida is one of only seven states without an income tax. In fact, the state constitution expressly prohibits such a tax. Furthermore, Florida companies pay no taxes on intangibles assets such as patents. Accordingly, it comes as no surprise that Florida-specific patent laws give tax advantages to companies based here.
- Patent royalties in Florida considered non-business income. F.S. 220.16.
- Expiring patents treated as a liquidating asset under Florida law. F.S. 738.603.
- Application of Florida’s tax exemptions for research and development with respect to patenting. F.S. 212.052.
- Patented liquids not subject to Florida’s Beverage Law. F.S. 561.02.
State-Funded Patenting of Research and Development
Florida is a business-friendly, high-technology state. As a result, research and development maintains and attracts high-paying, highly-educated workers. Moreover, Florida has express statutory procedures for supporting this R&D framework:
- Reporting of patents generated through state-funded biomedical research:
- Providing when the Institute for Commercialization of Florida Technology can take an interest in patents. F.S. 288.9625.
- Florida’s Innovation Incentive Program reinvestment of proceeds of patentable discoveries. F.S. 288.1089.
Florida’s College Savings Program
Florida College Savings Program requires a registered patent attorney to write a legal opinion. Furthermore, the opinion must indicate the operation of the program will not knowing infringe any patent or copyright. F.S. 1009.981. Unquestionably, this provision stems from the Supreme Court case finding that the State of Florida was immune to patent liability. Thus, the 5-4 decision, in Florida Prepaid Postsecondary Education Expense Board versus College Savings Bank, 527 US 627 (1999) set a landmark precedent. Significantly, this emboldened research universities to take a more aggressive stance in protecting and enforcing patent rights.
Florida’s Prescription Drug Programs
Florida uses its sovereignty to find the most efficient medical care and prescription products for its citizens. However, such laws are necessarily subject to honoring the U.S. patent system.
- Florida’s International Prescription Drug Importation Program eligible prescription drugs. Those drugs cannot violate U.S. patent laws. F.S. 499.0285.
- Florida’s Canadian Prescription Drug Importation Program eligible prescription drugs. Those drugs cannot violate U.S. patent laws. F.S. 381.02035.
Florida’s Insurance Rate Disclosures
Florida regulates its insurance industry to insure rates are not excessive, inadequate or unfairly discriminatory. However, some areas of coverage, like patent liability, are generally too complex to standardize. For instance, advertising injury, burglary and theft, travel insurance and excess property are highly variable. Accordingly, for insurance rates disclosures, IP and patent infringement liability rate disclosures are not mandated. F.S. 627.062.
In conclusion, it surprises even many longtime patent attorneys how many Florida-specific patent laws exist just in Florida Statutes. Accordingly, it is important that Florida-based organizations be familiar with both the liabilities, but more likely the opportunities that exist in Florida.