Posts Tagged: "Capitol Hill"

The Senate Roll was called and a vote taken on whether to table the Feinstein Amendment. The votes were 87 in favor and 13 against, thereby killing the Feinstein Amendment and keeping the first-to-file provisions within S. 23.

As flattering as it was to be inserted into the patent reform debate in some peripheral way, the real news from yesterday was the Manager’s Amendment was passed by a vote of 97-2. The Manager’s Amendment included language that would allow the United States Patent and Trademark Office to keep the fees it collects. The Manager’s Amendment reportedly also included insertions favored by Congressman Lamar Smith (R-TX), who is chair of the House Judiciary Committee. Thus, it seems quite likely that patent reform will soon become a reality.

Easily the most eggregious thing written about patent reform, at least that I have seen, is a statement from the Associated Press. In talking about the grace period in the patent reform legislation the AP wrote: “It comes with an enhanced grace period to protect inventors who publicly disclose their inventions before seeking patents.” This is not misleading, it is flat wrong. The grace period contained in S. 23 is not “enhanced,” but rather it is reduced.

What follows is a letter to Congress from Gary K. Michelson, MD, published here with permission…. First to invent versus first to file is the proverbial tempest in a teacup (smaller than a teapot). All sound and fury signifying nothing. The low cost and ease of filing a provisional patent application (a placeholder for the first to invent) should render any discussion of fairness moot. I believe that first to file is both fair and beneficial to all inventors; and is an important change to correctly position the U.S.P.T.O. as the leader in what will become a worldwide patent system.

Congress is at it once again, with the Senate Judiciary Committee reporting out a bill last week that remarkably resembles the bill that has been unable to gain any traction in the Senate for the last several years. That would suggest that the same fate is in store for this legislation. Not so fast! I have a suspicion that this year things are different and that we really could be on the cusp of patent reform. Whether that is for better or for worse will largely be in the eye of the beholder, but what is emerging feels different and I think we are closer to change, and perhaps an end to fee diversion, than we have been at any point over the last 6 years.

The Coburn Amendment would create a specialized fund within the Department of Treasury known as the ‘‘United States Patent and Trademark Office Public Enterprise Fund.” The PTO Director would have access to monies in the Fund for expenses ordinarily and reasonably necessary for running the Office. Perhaps most importantly, the Fund could grow so monies in the Fund could be accessed by the Director without fiscal year limitation. This could allow the Fund to grow in certain years to a critical mass that may be needed for capital expenditures. This is a brilliant idea and one that the industry needs to get behind wholeheartedly.

On Friday, February 4, 2011, the USPTO will publish in the Federal Register a notice of proposed rulemaking on “Track One” of the program, which will give applicants the opportunity for prioritized examination of a patent within 12 months of its filing date for a proposed fee of $4,000. Sadly, because the Patent Office does not have fee setting authority there will be no reduction in fees available to small entities who otherwise normally pay 50% of most Patent Office fees. Because the Congress controls which fees qualify for small entity preference everyone will need to pay $4,000 to accelerate under Track One.

Specifically, we learned that the USPTO projects an average first action pendency of 23 months by the end of fiscal 2011, that participating in the First Action Interview Pilot Program more than doubles the likelihood of getting a first action allowance, that Track 1 rules are imminent with rules for Tracks 2 and 3 to follow and during FY 2010 nearly 6,000 USPTO employees worked from home at least a portion of their work week. We also heard an ominous and declarative statement from Kappos, who told the House Subcommittee on Intellectual Property that the diversion of fees will cause the patent backlog to rise.

Innovation and entrepreneurship are central pillars of America’s economic strength and critical vehicles for job creation. Reporter John Schmid of the Milwaukee Journal Sentinel wrote an article that was published on Sunday, January 16, 2011, aptly depicting the problems facing would-be job creators. Schmid wrote in part of his article about a professor from the University of Wisconsin-Milwaukee who needed 11 years to obtain a patent on his revolutionary invention. How many jobs were lost as a result of unacceptably slow processing by the Patent Office?

Realistically, I understand full well that it is unlikely that Congress will bother themselves with reform efforts that are sensible, at least at the moment. It is also unlikely that innovators will be adequately represented in any reform efforts once they do arise. It seems that the power structure in Washington, D.C. believes that the term “innovator” and “big business” are synonymous, which surely they are not. It is also unlikely the Senate will move beyond the legislation Senator Leahy wants so badly but can’t seem to move. Thus, if we really want sensible reform that actually raises up the Patent Office and guarantees the value of patents for innovators we need to be ever vigilant.

According to Pascal Levensohn, Managing Partner of Levensohn Venture Partners, the problem with the US economy is the lack of Initial Public Offerings. He opines that without an increase in IPOs in the United States it will be difficult, if not impossible, to see the economic growth that we want. Without economic growth there will be no job creation, and the sluggish US economy will continue on its anemic path. He suggests that the best way to increase IPOs is to increase venture capital and make it more attractive. He writes that is our leaders really wanted to fix the job problem in America “there would be no higher legislative priority than promoting regulatory and tax reform to stimulate new capital formation and venture capital in the U.S.”

In 2011 expect Congress to take up patent reform again, expect it to go nowhere, and expect the anti-patent forces to continue to look to the Courts to do what they have been unable to achieve in Congress, which is the substantial weakening of patent rights. Truth, science and economics are on the side of a strong patent system that rewards innovators. Make it your New Years Resolution to talk to friends, family and business associated about the need for a better functioning Patent Office and meaningful patent rights that can support the creation of new companies and industries. The more we talk about it the better. We can’t call a press conference and get hundreds of media there like the ACLU can, so we need to excel at the ground game — a grassroots movement that isn’t afraid to say it like it is and point out the agenda of those who would prefer to harm innovation in America.

Bayh-Dole was created because of a glaring problem– billions of hard earned tax dollars invested annually in government R&D were being squandered by ineffective government patent policies. If this research cannot be taken out of the labs and turned into products, the public is being short changed. Even so, it was a long, tough road to travel, and we only succeeded by the smallest of margins. Turning around long standing government policies, no matter how ineffective, is never easy.

At one point during his remarks last night President Obama said: “Nobody rushes on the field and dumps Gatorade on them (laughter) when you win a science award. Maybe they should!” Indeed we should celebrate science and math victories every much, if not more, than we celebrate sports victories, but that is not our culture unfortunately. We need to change our culture to raise the profile of those who are succeeding on every level in the scientific fields. President Obama can play a major role in bringing about that change, and his raising the profile of those who are science fair winners is certainly encouraging.

On October 12, 2010, I had the honor of interviewing retired United States Senator Birch Bayh, who was the primary architect of the landmark Bayh-Dole Act. In this second and final installment of my interview with Senator Bayh we will discuss the aforementioned loft praise for Bayh-Dole, which came from The Economist. We will also discuss statements of Vice President Biden (when he was a United States Senator) regarding the tremendous success of Bayh-Dole, how the United States can stay on the cutting edge of technology, and how to successfully lobby for changes in the patent system.