By Donald Zuhn --
Economist Alex Brill, who last fall released a report on follow-on biologics, is back, this time focusing on proposals for "reforming" the U.S. patent system instead of suggestions for creating a follow-on biologics regulatory pathway. Patent Docs readers may recall that in November, Mr. Brill (at right), a research fellow at the American Enterprise Institute and former chief economist to the House Ways and Means Committee, issued a white paper asserting that a follow-on biologics regulatory pathway providing a data exclusivity period of seven years would be "sufficient for maintaining strong incentives to innovate while fostering a competitive marketplace" (see "Former House Ways and Means Economist Claims 7-Year Data Exclusivity Period Is Sufficient"). Today, in a commentary appearing on Forbes.com (see "What Should Congress Do With Liars and Cheaters?"), Mr. Brill argues that "[c]ompanies that feel overly burdened by current [inequitable conduct] law should take solace
in the fact that the government does not throw patent holders that lie
and cheat behind bars" as it has done with a "parade of executives sentenced to jail time over the last few years for securities fraud."
In the midst of continued Congressional debate over patent reform, Mr. Brill makes it clear that he favors harsher penalties for "patent holders that lie and cheat." Few would disagree with Mr. Brill's assertion that "it is vital that patent holders not commit fraud" while procuring patents. More than a few patent practitioners, however, would disagree with Mr. Brill's suggestion that Congress "put[] some more teeth into [the inequitable conduct defense]." Mr. Brill's proposal appears to stem from his belief that Congress has begun "contemplating changing the rules with regard to inequitable conduct" -- rules changes that he believes might "defang the inequitable conduct defense." It is important to note, however, that the Senate patent reform bill (S. 515), which has already been reported out of Committee, and the House patent reform bill (H.R. 1260) do not address inequitable conduct. Thus, Mr. Brill's fears of a weakened inequitable conduct defense would seem to be (at least for now) unfounded.
In addition, while Mr. Brill contends that "[a] strong deterrent is necessary to produce confidence in the entire patent system so that investors are willing to risk their capital to develop new innovations," he provides no evidence that fraud before the USPTO has become so rampant that investor confidence can only be restored (or assured) by passing radical inequitable conduct reform. Moreover, Mr. Brill's proposed reform would only exacerbate a problem the Federal Circuit recognized more than twenty years ago when it called the frequent practice of pleading inequitable conduct a "plague on the patent system" (Burlington Industries Inc. v. Dayco Corp., 849 F.2d 1418 (Fed. Cir. 1988)). Thus, while Congress should take up the issue of inequitable conduct reform, it would best refrain from adding "criminal penalties, punitive damages or jail terms" to the current penalty of patent unenforceability, and instead consider ways in which the defense can be improved in order to encourage a more open dialog between applicants and the Patent Office.
I suppose he's aware theres not even a duty of disclosure in Europe.
Posted by: anon | June 03, 2009 at 08:25 AM
I am not sure that the argument presented by Mr. Brill isn't a little misleading. No one wants liars and cheats to go unpunished. The focus (at least from what I have seen) is on cleaning up the test for IC - stopping the conflating of the two prongs of materiality and intent. Mr. Brill does not seem to acknowledge the abuse of the IC charge tactic and further cloaks the issue in a seeming presumption of guilt.
Posted by: breadcrumbs | June 03, 2009 at 08:46 AM
Just another pointy-headed intellectual opining on things he has zero real world understanding of. Too bad some of these know-nothings actually get an audience.
Posted by: CNS | June 03, 2009 at 09:51 AM
"I suppose he's aware theres not even a duty of disclosure in Europe. "
In Europe they don't care if you cheat your fellow man.
"Moreover, Mr. Brill's proposed reform would only exacerbate a problem the Federal Circuit recognized more than twenty years ago when it called the frequent practice of pleading inequitable conduct a "plague on the patent system""
That isn't necessarily true Kev. We could tone down the instances where it is proper to plea IC defense and turn up the punishment. In fact, turning up the punishment might cut down on the number of IC defenses being plead because more info would be submitted to the PTO.
Posted by: 6 | June 03, 2009 at 01:40 PM
I'm sure he is trying to strengthen the patent system to foster innovation. However, I think that the key is in rewarding patent owners by strengthening their rights instead of trying to deter malfeasance.
People misapply general patent concepts all the time. See, generalpatent.com/2009/05/07/response-andy-grove
Posted by: Josh K | June 03, 2009 at 02:32 PM
Dear 6:
Are you saying you want more art to be cited?
Posted by: Kevin E. Noonan | June 03, 2009 at 04:30 PM
Kevin,
Yes, that is, until the art actually comes in and then 6 screams like a baby and begs "make them stop".
See http://www.patentlyo.com/patent/2009/05/bpai-precedential-opinion-on-rejecting-software-means-claims.html
By the by, I have here my second app with 100+ NPL, 500+ overall refs in IDS's over its course.
IDSs. Get them under control.
Posted by: 6 | May 18, 2009 at 08:54 PM
Posted by: Noise above Law | June 03, 2009 at 04:56 PM
"Are you saying you want more art to be cited?"
If it is good, yes I would. Take those cases that have 500+ references in them. 400+ of those references had nothing to do with any element of any of the claims. Zero. None. Zilcho. 250+ had nothing to do with any element of any of the specification. Now, if they were to send in 500+ good references I would be a happy man. Indeed, amongst the happiest.
Beg them to stop? Lol, funny you should mention that case with 500+ refs. The first one of those I literally asked the attorney on the phone to send me another reference. What happened was a situation where he filed an IDS after my nonfinal which included a chinese OA which took a different view of a reference I had already been considering and as a result got one more of the deps than I had figured the ref did not cover. Of course he squawked when I finaled him and put in the new grounds of rejection on a previously indicated as allowable claim. All I did was point to the IDS and tell him to keep on sending me chinese OAs that show me specifically where all his limitations are found. Unfortunately that was the only OA that he submitted that ever turned out to be useful.
Posted by: 6 | June 03, 2009 at 07:23 PM
I should note that out of those 500 references he could have submitted about 10 and been far and away in the clear except for the fact that he had to submit most of them because they were cited in related apps. I believe that's part of the rules of submission isn't it? Like if the ref's were cited against related apps then you have to submit them even if you don't feel they're relevant? Idk, maybe I'm wrong and you don't have to submit them. In which case, he certainly should have only submitted like 10.
Posted by: 6 | June 03, 2009 at 07:26 PM
so what does Brill know about patents anyway? has he ever invented anything, filed an application, prosecuted, appealed, enforced, licensed? Not according to his bio. why would he comment on something he has no experience in?
ah, from the same people that brought us too big to fail buyouts!
Posted by: staff | June 04, 2009 at 08:40 AM