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Sen Menendez Asks SEC to Investigate IPR Abuses

June 10, 2015
New Jersey Senator Bob Menendez has asked the Securities and Exchange Commissioner (SEC) to investigate a new investment scheme designed to manipulate the stock prices of companies engaged in research and development of innovative medical therapies, to determine if the practice is illegal.

As reported in this Bloomberg Business article, certain investment firms are shorting the stocks of patent-dependent life sciences companies and then using new patent litigation procedures to challenge their patents and drive down the companies' stock prices.

Last week, Senator Menendez sent a letter to the SEC expressing concern that the Patent & Trademark Office’s Inter Partes Review (IPR) process, created as part of the 2011 America Invents Act, is being used as a tool for “market manipulation and abuse.”