By Donald Zuhn --
BIO Reaffirms Support for H.R. 1249
In a statement released earlier today, the Biotechnology Industry Organization (BIO) reaffirmed its support for H.R. 1249 and urged the House to pass the bill this week. BIO President and CEO Jim Greenwood noted that the organization was "pleased that Judiciary Committee Chairman Lamar Smith (R-TX) and Appropriations Committee Chairman Harold Rogers (R-KY) have reached agreement on U.S. Patent and Trademark Office (PTO) funding and that the appropriators are committed to ensuring that the PTO will retain the entirety of the fees it collects from inventors."
Patent Reform Coalition Also Reaffirms Support for H.R. 1249
Like BIO, the Coalition for 21st Century Patent Reform issued a statement today reaffirming its support for moving H.R. 1249 to the House floor this week for a vote. Although the group noted that it "preferred Section 22 of H. R. 1249, as reported by the Judiciary Committee, addressing the diversion of fees paid by users of USPTO services," the Coalition "decided to support the USPTO funding agreement that, if fully implemented, is intended to provide the Office with full access to the fees paid by inventors." The group indicated that it "will be vigilant as the full implementation of the commitments made under the agreement is completed."
Innovation Alliance Reiterates Opposition to House Bill
In a follow-up to a statement the group released on Monday, the Innovation Alliance reiterated that in view of changes to the bill's USPTO funding provisions, the group "has no choice but to vigorously oppose the version of the America Invents Act scheduled to be considered by the full House of Representatives [on Wednesday]." In today's statement, the Innovation Alliance noted that it had "consistently said that it would oppose any patent bill that does not end permanently the diversion of user fees from the U.S. Patent and Trademark Office," and that "[u]nfortunately, we have come to that point" with the current version of the bill.
In defending its position, the group explained that:
The compromise language released yesterday does not end fee diversion permanently and enable USPTO to plan predictably and on a sustainable basis. In fact, it requires the USPTO to continue to rely upon the appropriators to have access to and use of all the application and other user fees it earns. Any future appropriations bill could easily divert USPTO funds to other uses. As a result, it will be difficult if not impossible for USPTO to make multi-year plans, to hire and retain personnel, and to improve operations and information technology, all of which are critical to decrease the substantial backlog of pending patent applications.
"While appropriators have promised not to divert the fees USPTO collects," the group suggested that "current and future budget pressures will only increase, and future appropriators may not feel as constrained from diverting USPTO fees to other uses." The Innovation Alliance contended that "[w]ithout a permanent end to fee diversion and USPTO's guaranteed access to collected fees -- such as was contained in the Senate-passed bill and Section 22 of the bill as approved by the House Judiciary Committee -- the America Invents Act is an unfunded mandate on an important agency that is already overburdened and under-resourced."
AIPR Urges Adoption of Conyers/Sensenbrenner/Manzullo Amendment
The American Innovators for Patent Reform (AIPR) announced its support earlier today for an amendment to H.R. 1249 that was introduced by Representatives John Conyers, Jr. (D-MI), James Sensenbrenner, Jr. (R-WI), and Don Manzullo (R-IL) on June 13, 2011, and which would strike the entire bill except for sections 2 (Definitions), 22 (Patent and Trademark Office funding), and 31 (Budgetary effects). According to the group's statement, "[t]he amendment would end fee division and establish full funding for the U.S. Patent and Trademark Office (USPTO), enabling the agency to keep all fees it collects." The statement "urges all members of the House to vote in favor of the amendment when H.R. 1249 comes to the floor for a vote, probably this week." AIPR President Alexander Poltorak asserted that "[d]iverting fees that the Patent Office collects from inventors and patent applicants is nothing short of a tax on innovation," adding that "[p]ermanently ending fee diversion should be a core feature of any patent reform." The AIPR concluded today's statement by urging supporters of the amendment to contact their Representatives immediately.
Six Organizations Add Support to Conyers/Sensenbrenner/Manzullo Amendment
In a joint letter sent to all House members, six organizations representing small businesses, start-up entrepreneurs, independent inventors, and technical professionals urged lawmakers to adopt the Conyers/Sensenbrenner/Manzullo amendment, that the coalition contended "will stop the diversion of patent user fee revenue to other governmental uses." The six organizations signing onto the letter were IEEE-USA, National Congress of Inventor Organizations, IP Advocate, National Small Business Association, National Association of Patent Practitioners, and the Professional Inventors Alliance USA. The letter states that by removing most sections of H.R. 1249, the amendment "would eliminate many harmful provisions in the bill that, if enacted, would cause innovation disruption and create legal uncertainty for many years to come." One of the "harmful provisions" highlighted in the letter is Section 10, which the coalition contends "would otherwise grant the PTO broad authority to set fees based on no guidance or policy constraints except the PTO’s opaque and unknown interpretations of 'aggregate costs'." The letter also asserts that H.R. 1249 contains "a major legal flaw which indicates lack of adequate forethought in drafting and amending this bill." In particular, the letter explains that:
Owing to substantial spread in examination timing across examiner workgroups at PTO, a later-filed application can be issued well before an earlier-filed prior-art application reaches an examiner’s desk for examination. With no effective legal recourse available to the first-filer of the pending application for removing the later-filed issued patent, the second-filer would end up with a valid patent, solely due to PTO administrative delay variations. This result is in direct contradiction to H.R. 1249’s stated purpose of awarding patents to the first-inventor-to-file.
Four Representatives Seek "No" Vote on H.R. 1249
Last week, Representatives John Conyers, Jr. (D-MI), Donald Manzullo (R-IL), F. James Sensenbrenner, Jr. (R-WI), and Marcy Kaptur (D-OH) circulated a letter to their colleagues, asking other House members to join them "in opposing H.R. 1249, patent legislation that would favor large multinational corporations over U.S. inventors" (see "Patent Reform News Briefs," June 13, 2011). Today, Representatives Conyers (at right), Sensenbrenner, and Manzullo, joined this time by Rep. Dana Rohrabacher (R-CA), distributed a similar letter once again asking their colleagues to vote "no" on H.R. 1249. While noting that the three legislators "may have different concerns with the legislation," the letter's authors state that "as Members of Congress including two former Chairs of the House Judiciary Committee, a former Chair of the Small Business Committee, and a former Chair of two Science, Space and Technology Subcommittees, we agree that this special interest bill will cost jobs, harm small start-up inventors, and stifle innovation and investment here in the United States." In addition, the letter indicates that:
[A]ccording to the Congressional Budget Office, the Manager's Amendment would violate the new cut-go rules [recently adopted by the Republican Majority]. This is because the base bill is estimated to have a discretionary cost of $446 million over the next five years ($1.1 billion over the next ten years) and, the Manager's Amendment, by undoing the anti-fee diversion language, eliminates a procedure that would have decreased the budget deficit by $ 717 million over five years. The net result is that the Manager's Amendment will leave us with a bill that increases discretionary costs by almost one-half billion dollars over five years.
As in last week's letter, the group itemizes "additional concerns" with the bill, including: (1) Section 22 of the latest Manager's Amendment, which "codifies the status quo: funding for the USPTO will be at the discretion of the appropriators"; (2) Section 18, which "provides large banks a special, new bailout at the expense of inventors and the American taxpayer, and even worse, would do so on a retroactive basis"; (3) the change from a first-to-invent to first-to-file system, which some groups believe is "a dangerous and unconstitutional effort to overturn over 220 years of patent practice"; (4) Section 27 of the latest Manager's Amendment, which "requires a study on methods to provide independent, confirming genetic diagnostic test activity where gene patents and exclusive licensing for primary genetic diagnostic tests exist," and therefore, "has the potential to complicate pending litigation on the legality of patents on human genes"; and (5) Section 16, which "undermines the false marking statute by retroactively changing the law applicable to pending enforcement actions."
The letter concludes by providing a link to a list of letters and statements from groups opposing H.R. 1249 that have been posted on a webpage on the Democrats' House Committee on the Judiciary website.