Posts Tagged: "Senate"

This will be the first time that Lee has had a confirmation hearing. The timing suggests that the Obama Administration and Senator Reid think that they can get Lee confirmed prior to the end of this Congressional session, which may well be the case. Assuming that this hearing will be more than just a show, there are a number of difficult questions that should be asked of Lee… Why is the Patent Office secretly subjecting applications to extraordinary scrutiny? Do you support fee-shifting legislation to combat the perceived problem of “patent trolls”? Does Congress need to step in and amend 35 U.S.C 101 to provide a more clear definition of what is patent eligible?

In recent weeks news has come out that Phil Johnson’s nomination as Director of the United States Patent and Trademark Office is dead. It seems to be dead due to the protest of at least one Senator on the Senate Judiciary Committee, not because the onerous vetting process produced any red flags or because the White House has lost interest. The Senator allegedly unhappy is Senator Chuck Schumer (D-NY)… [N]ominees [are put] through an extraordinary vetting process that reportedly can take between 5 to 9 months to complete even in the best case scenario. Let’s say that the White House has decided to move past Johnson and will not look back. They must first identify a willing candidate; someone who can pass through the gauntlet that is the vetting process, has the requisite experience and who is willing to take a substantial pay cut. Such an individually would likely having to unwind investments and holdings, or at least put them into some blind trust. Even if the White House can this week identify that person who accepts the invitation to take the position and who is willing to subject themselves to scrutiny that would make an IRS inquiry look like a day in the park, that means we are looking at at least January 2015 before confirmation.

While Senator Leahy said that he hopes to be able to return to patent reform this year, the legislative calendar does not look good. Now removed from the Committee calendar patent reform seems to dead for this Congress. No vote will be taken on the Senate version of patent reform until the next draft is released and voted on by the Judiciary Committee, which doesn’t seem likely to happen anytime soon. Then if the Senate does pass patent reform it is guaranteed to be different than the version passed by the House of Representatives. Ordinarily one might suspect that would lead to a Conference between the House and Senate, but Judiciary bills are rarely, if ever, sent to Conference. That means even if the Senate passes patent reform the bill would bounce back to the House, and we could see an ensuing game of ping-pong, with greatly intensified lobbying by both sides. All the while legislative days are dwindling, and useful legislative days in advance of the November election are even more limited. Indeed, with this announcement today it seems that patent reform is now dead for 2014. The only hope proponents have is that patent reform will sneak back in a lame duck session of Congress, but I believe that hope to be somewhat far-fetched.

Sen. McCaskill introduced S. 2049 in February 2014 which would require the FTC to promulgate rules to prohibit unfair and deceptive acts and practice in the sending of patent demand letters, including requiring each such letter to identify the patent number, the claims, a description of the manufacturer and model number of each accused product or service, notice that the recipient may have the right to have the manufacturer defend against the infringement, the identity of the person with the right to enforce (including each owner, co-owner, assignee, exclusive licensee, and entity with the authority to enforce the patent, and the ultimate parent entity), any FRAND licensing commitments, any basis for a specific license amount, and each PTO proceeding or litigation involving the patent. Bad faith assertion would be enforceable by the FTC or attorney general of a State in federal court.

U.S. patent litigation has followed the centuries-old “American Rule” under which each party to a litigation pays its own legal fees and costs, regardless whether it wins or loses the litigation. A narrow exception exists in patent cases, but only in “exceptional cases” under 35 U.S.C. § 285, such as where the losing party engaged in litigation misconduct, or if the patent was fraudulently procured, or if the losing party raised arguments that were both objectively baseless and made in bad faith. Despite the long tradition of litigants paying their own legal fees and costs, Congress has shown interest in changing the playing field and deviating from the American Rule in patent cases. This comes at a time when the U.S. Supreme Court is already considering two cases that relate to the definition of “exceptional cases” in § 285 that may well alter how this existing exception to the American Rule is applied in practice.

Gardner proposes to make it patent misuse to charge much more in the United States for the same drug than in the rest of the G7. According to Gardner, “it would be presumptive patent misuse to charge more than 125% of the average price in the other 6 countries in the G7 and it would be conclusive patent misuse to charge more than 150%.” This innovative change would be a simple change in the U.S. patent laws and would be very impactful. Said Gardner, “If the patent is being ‘misused’ in this way, the patent would be invalidated and/or unenforceable, opening up competition for generics. So the owner of a drug patent would have a strong interest in avoiding losing the protection of the patent and would hold down U.S. prices and/or drive up prices around the world. Either way, we (the U.S. consumers) would over time end up paying the real price of patented medicines, not the exaggerated price which includes a subsidy for foreigner consumers.”

“Today, Congress is under another call to weaken patent protection. This time the alleged culprit is a so-called “patent troll” who, according to some reports, hijacks inventions and while providing no product and therefore no societal value, extorts billions of dollars from the economy. This story could not be further from the truth. The argument is based on highly questionable data. Some of the claims are that patents asserted by so-called “patent trolls” are much weaker than patents asserted by others, that these entities cause billions of dollars of unnecessary cost, and that the number of patent infringement lawsuits has risen dramatically due to the so-called “patent trolls.” All of these assertions are highly disputed.”

“The first rule of any patent legislation should be to do no harm, particularly to the inventors, start-ups and universities that create our nation’s next big fundamental technology breakthroughs that drive GDP and job growth,” said inventor Earl “Eb” Bright, COO ExploraMed and Board member USIJ. “The Senate has an opportunity to get this right and I hope they seize it – our standing as a global leader is directly dependent on the strength of our patent system and its ability to support innovative enterprises of all sizes.”

2013 turned out to be a very big year for IP, and especially patents, and the year took a course that few would have predicted this time last year. At that time, the senior team at the PTO was primarily focused on the imminent departure of our then-boss, David Kappos, and the end of what had clearly been an extraordinarily active and successful tenure. The AIA had been almost entirely implemented, the new Patent Trial and Appeal Board was up and running, and most of us expected 2013 to be focused on implementation and execution of the AIA and the other initiatives that had been set in motion under Director Kappos.

As the end of 2013 approaches and I look back on what has transpired I am saddened to see that through the year patent rights have continued to erode. Make no mistake about it, at every turn patent rights are eroding. You might think that there has been some collective, open-air discussion about whether this is a good idea. Nope! It seems government you get is the government you can afford, and those who have the ear of decision-makers on Capitol Hill are the extraordinarily well funding big tech companies that want to weaken patent rights or do away with them altogether. Indeed, there has been scant consideration paid to the effect of weakening patent rights. The erosion of patent rights is exceptionally alarming given the fact that the Founding Fathers thought it was self evident that a strong patent system was essential for America. The Founders believed the importance of patent rights to be so self evident that little debate was had on the topic. How the pendulum has swung!

A recurring theme that can be traced through the patent reforms of the AIA to the current debate over patent litigation abuse is the issue of patent quality. A key component of the reported abuses is the assertion of allegedly invalid or overbroad patents, the very abuse for which AIA post-grant procedures were created, in order to improve patent quality. These matters of patent quality are being addressed by the changes made to the law by the Judiciary and by Congress in the AIA, which are only now beginning to be felt. It may well be premature to conclude that they are not doing the job. Take one major example, as a former Director of the USPTO in particular, I would support, as former Director Kappos did, giving the post-grant processes in the USPTO a chance to work.

While in the Solicitor’s Office at the USPTO Chen’s notable Federal Circuit arguments included In re Bilski, In re Nuijten, and In re Comiskey. While I disagreed with the Federal Circuit decision in each of those cases I still believe Chen to be an excellent choice for the Federal Circuit. While some may look at the cases where Chen defended the Board, that was his job and I would caution reading to much into the briefs filed looking for a window into the judicial philosophy of Chen. Indeed, I have every reason to expect that he will align himself with the pro-patent wing of the Court.

Litigation always factors into the pharmaceutical world, but the US Supreme Court commanded a special place in recent days. The high court figured in no fewer than four contentious issues that, not surprisingly, play a vital role in how drug makers can and will operate. Let’s start with a case that is not yet before the court, but many predict will be headed there thanks to one of its earlier rulings. Earlier this month, a three-judge panel of the US Court of Appeals for the Second Circuit overturned the conviction of a former sales representative, who argued that prosecuting him for remarks made about off-label use violated his free speech rights.

The PTO, the House and Senate Judiciary Committee staffs, and some segments of the patent community, mainly those that were supporters of the AIA, had drafted a a proposed technical corrections bill. Obviously, if a proposed change is purely technical in nature, there shouldn’t be a lot of trouble passing it, but what is technical and what is not technical can be a rather subjective test. There has been some talk about efforts to change the AIA in ways that would have substantive effect on the law . And it’s those issues that have garnered some attention in recent months. There was some discussion about changing the estoppel standard for the post grant review provisions of the AIA, and there have been some proposals regarding a proposed expansion of prior user rights being kicked around as well. If those are on the table or appear in a technical corrections package, “technical” in quotes, I think it would be difficult to pass such a measure this calendar year. Nevertheless, that doesn’t mean that those who support those changes won’t continue to press for them and try to see them enacted, if not this year maybe next year.

Cooney is a prominent behind the scenes player in Washington, DC. He is a partner in the American Continental Group, a D.C. based consulting and lobbying firm that boasts one of the most prominent IP practice groups in town. Cooney and the American Continental Group were intimately involved in working behind the scenes on the America Invents Act (AIA), as well as the predecessor legislation that was circulating through Congress for years before it ultimately passed. With the anniversary of the passage this month I asked Manus if he would go on the record to talk about his experiences, legislation and lobbying in general, as well as what is on the horizon for the future.