Posts Tagged: "Patent Reform"

Today the House Subcommittee on Intellectual Property, Competition and the Internet, which is a subcommittee of the House Committee on the Judiciary, held a hearing on the America Invents Act, the House version of patent reform. While the House and Senate bills are largely identical, there is one striking difference between the two, and that difference relates to prior user…

The Innovation Alliance is disappointed that the America Invents Act as introduced today in the House of Representatives does not include some important safeguards against the potential for abuse of the post-grant review procedures at the U.S. Patent and Trademark Office (USPTO). In particular, the bill includes a weak threshold for ‘second window’ inter partes review proceedings, one that will allow virtually all challenges to proceed to a trial-like hearing before an administrative patent judge. We believe a higher threshold is needed to enable the USPTO to manage the increased workload of the new administrative review system fairly and efficiently by screening out meritless or unsubstantiated petitions.

A prior user rights defense prevents those who have previously used the patented invention from being infringers. In many parts of the world there are strong prior user rights, which allow those who keep innovation as a trade secret hidden away from the public to later use those trade secrets as a defense to a patent infringement lawsuit. You can’t sue me for patent infringement because I have been hiding, using that innovation you patented as a trade secret. So the party that disseminates the information for the benefit of the public loses in favor of the party that kept the innovation a closely guarded secret. This has never struck me as fair, a good idea or even in keeping with the Constitutional purpose for patents.

I think those that are against first to file are really most worked up about the loss of the across the board grace period for the statutory bar. If the problem is with the grace period let’s talk about the grace period. Misdirection and demagoguing the first to file issue has lead to the weakness of the arguments being exposed and the likelihood that no meaningful debate on the real issue — the grace period — will be possible. I’m here to tell you that those who are making a big deal out of the loss of the ability to swear behind with 131 affidavits are making a mountain out of an ant hill; not even a mole hill.

Late in the afternoon on Thursday, March 24, 2011, the purported patent reform bill from the House of Representatives began circulating. The House patent reform bill is largely identical to the Senate version – S. 23. There are some differences, one rather major difference, but the Senate first to file provisions remain intact. The House bill would still grant the Patent Office the right to use all of the funds collected, as did S. 23. The House bill also would grant the United States Patent and Trademark Office fee setting authority, as did S. 23, but then curiously goes on to set the fees that the USPTO charges. It seems unclear why on one hand you would set the fees and in another section of the bill say that the USPTO can vary any fees defined.

The date of invention relates to your conception. This is true whether you are engaging in an interference proceeding seeking to obtain a claim instead of another who is also seeking the claim, or you are attempting to demonstrate that you can get behind a reference used by an examiner because you have an earlier date of invention. The hallmark of a first to invent system is that those who file second can obtain a patent under very strictly limited scenarios. A byproduct of a first to invent system is that if the examiner finds prior art you can “swear behind” the reference using a 131 affidavit to demonstrate that reference is not prior art for your invention. In both the interference context and the 131 affidavit context there needs to be proof of conception that will satisfy the patent laws.

During my interview with Secretary Locke we spoke about patent reform efforts in the United States Senate, what patent reform might look like from the House of Representatives, his management style and how to motivate individuals to achieve transformative change. Secretary Locke strikes me as a thoughtful person, extremely energetic, motivated to succeed and the type of person we need in government. His CEO-like approach to running the Department of Commerce and in working together with both political appointees and career employees has transformed the Patent Office, and he will be missed. I’m sure he will make an excellent Ambassador, but have to wonder about the future of the Department of Commerce and the Patent Office. Whoever becomes the next Secretary of Commerce has some big shoes to fill.

With a powerful vote of 87 to 3 on a motion to bring debate to a close, the Senate is on the cusp of passing comprehensive patent reform legislation. S.23, “The America Invents Act,” is expected to pass with a strong vote as early as Wednesday of this week. In the end, the full House and Senate will need to pass the same version of any patent reform bill before it can become law. Assuming House Judiciary Committee Chairman Smith passes a bill of note through the House; the House and Senate bills will need to be reconciled. While civics books teach that the differences in the bills will be resolved via a formal Conference Committee, the Senate and House have not conferenced on a Judiciary Committee bill since 2005. A formal conference for patent reform is considered very unlikely.

As the debate in the Senate starts to wind down and moves to the House of Representatives, whether you are pro-reform or against reform, get involved and participate. Taking the time to be engaged can go a long way. In listening to the debate in the Senate over the past 4 days it is clear to me that Senators are listening to those on both sides who engage in thoughtful debate. While I am often cynical about government, it has been refreshing to watch. Painful at times, but nice to see that ordinary citizens can make a difference.

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.

As I have repeatedly explained over and over again for the past several years, there is nothing to fear about a first to file system (see above) AND there is no reason that a first to file system must be linked with changes to the grace period enjoyed by innovators. It seems those that would prefer to marginalize my factually correct statement about a de facto first to file statement conveniently ignore my complete views. Those who mischaracterize the truth seem to have an unhealthy and unnatural emotional attachment to a first to invent system that simply doesn’t exist, at least 99.99613% of the time.

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.

The Senate will take up patent reform on Monday, February 28, 2011, the first day back. Some are even anticipating that the Senate will vote on patent reform bill S. 23 late in the day on Monday, February 28, 2011. As we get closer to a vote in the Senate the rhetoric of those for and against is heating up to a fever pitch. The fight, once again, is over first to file, with battle lines drawn that run extremely deep. Senator Diane Feinstein (D-CA) is expected to file an Amendment stripping the first to file provisions, which could be supported by Senate Majority Leader Harry Reid (D-NV).

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.