It took over 6 years and two presidents (10 and three, depending who you ask), but a major patent overhaul finally passed both houses of Congress, after a Senate vote of 89-9 on H.R. 1249, without amendment. Although watered down from the aggressive changes to damages and litigation procedure proposed a few years ago, the bill still packs a punch and leaves many (read: small) businesses feeling as though their voices went unheard by lawmakers throughout the process.
Predictably, reactions are already flowing in. Carl Gulbrandsen, head of patent licensing at University of Wisconsin-Madison predicts a drop in new businesses and a cutback in patenting from universities. President Obama demonstrated his lack of connection with small businesses and entrepreneurs by congratulating Congress on passing “reform that will speed up the outdated patent process, so that entrepreneurs can turn a new idea into a new business as quickly as possible.” In reality, the bill benefits the typical tech giants like Apple, Intel, Google, Dell, eBay and Cisco. However, the bill’s biggest beneficiary may be IBM. The software company’s PR department immediately issued a statement:
As the top U.S. patent recipient for the last 18 years, IBM values the ability to efficiently secure and protect the intellectual property rights, and commends passage of the America Invents Act, which will modernize USPTO operations and provide the patent office with vital resources and tools it needs to significantly enhance quality of patents issued to inventors.
IBM, under the leadership of Marshall Phelps, turned its patent portfolio into a $2 B per year licensing enterprise. Odds are, they already have internal procedures in place to accelerate filings of their employees’ inventions.
The Senate debate prior to passage provided the most excitement C-Span has to offer. Senator Coburn did his best to champion the amendment to restore the PTO revolving fund originally passed in S.23. Senator Leahy played the role of the cowardly George McFly, asking his fellow senators to abandon their plans to provide a fully self-funding patent office because those mean guys in the House already changed it once. An amendment would force the bill back over to the House, and if they spurn the Senate plans again Leahy just can’t take that kind of rejection. Despite the media accounts, the Senate never voted on Coburn’s amendment. Instead, they voted on Leahy’s motion to table the amendment, which carried 50-48. Since a vote for the amendment meant voting against Leahy’s motion, I wonder how many Senators actually knew what side they were on.
Final passage in the senate was also not without some irony. One of the more obscure provisions changes the deadlines for requesting patent term adjustment. Evidently, with some retroactivity, passage of the bill will spare law firm WilmerHale from nine-figure malpractice liability. Curiously, this provision was thrown in by the House, as if on a lark, and failed to pass in its original vote. However, the vote was called while a House member was still in the “well” casting her vote. Although it wouldn’t have changed the outcome, Rep. Jesse Jackson Jr. insisted that the vote be retaken. Enough representatives changed from “nay” to “yea” during the second vote and the “WilmerHale bailout” was born.
Back in the Senate, the irony arrived in full when Senator Jeff–DataTreasury be damned–Sessions tried to torpedo the PTA section of the bill. His complaint? (And you should probably sit down.) He doesn’t want to bail out a law firm that made a mistake and make consumers and taxpayers to pay for that error. Apparently, the Senator from Alabama is not on WilmerHale’s donor list.
In the end, the rest of us suffer with a more complex patent system, adding new, overlapping post-grant review procedures (so a patent isn’t really a patent at all). The patent office remains subservient to politicians that control its purse-strings, which in the past has led to an understaffed, overworked examination corps. With a million patent backlog, and compensation (raise and bonuses) tied to “disposing” of patent applications, the emphasis is on rejection even where applications demonstrate merit. Underfunded inventors easily become discouraged by this process, by IP giants like IBM have the resources to trod right through the bureaucracy. Congress had a chance to fix it, and, simply put, they blew it. Next?
- Critics Decry Customized Provisions In Patent Bill (techdailydose.nationaljournal.com)
- Patent reform bill approved by Senate – Brooks Boliek – POLITICO.com (mbcalyn.wordpress.com)
- What The New Patent Reform Act Means For Innovation (fastcompany.com) – Ed. note: great example of an author utterly clueless on the operation of the patent system and the changes made by the bill