Senator Landrieu Introduces Legislation Requiring Study on Effects of First-to-File Provision

    By Donald Zuhn --

On Tuesday, Senator Mary Landrieu (D-LA) introduced legislation (S. 3089) that would require the Office of Advocacy of the Small Business Administration (SBA) to conduct a study and report on the effects of changes to U.S. patent law that would result from enactment of the Patent Reform Act of 2009.  In particular, Senator Landrieu's bill would require the Chief Counsel for Advocacy of the SBA to conduct a study of the effects on small business concerns of changing from a first-to-invent to a first-to-file invention priority system, including how the change would affect the ability of small business concerns to obtain patents and the costs and benefits of the change to small business concerns.

When introducing the bill, Senator Landrieu (at left) stated that as Chair of the Senate Committee on Small Business and Entrepreneurship, she wanted "to ensure that Congress' reform [of the U.S. patent system] will create a patent regime that will not unduly burden small businesses and independent inventors, but instead, enhance their success as innovators in the U.S. economy."  Noting that "[s]mall businesses represent 99.7 percent of all employers, employing 1/2 of the U.S. labor force," Senator Landrieu declared that "[a]t a time when our Nation's economy is under stress, we need the help of small businesses in creating new jobs and economic opportunities."  She contended that "[o]ne measurable way of tracking the rate of small business innovation in the U.S. is by analyzing patent statistics," and pointed out that "small businesses in the technology sector produce 13 times more patents per employee than large businesses."  As a result of the importance of patents to small businesses, and the importance of small businesses to the American economy, the Senator introduced S. 3089 as a way "to properly track and understand how changes to the U.S. patent system will impact our small innovators."

After being introduced, the bill was referred to the Committee on Small Business and Entrepreneurship.  The text of the bill as introduced reads as follows:

SECTION 1. STUDY AND REPORT OF PATENT LAW CHANGES.
    (a) Definitions.--In this section--
        (1) the term "Chief Counsel'" means the Chief Counsel for Advocacy of the Small Business Administration; and
        (2) the term "small business concern'' has the meaning given that term under section 3 of the Small Business Act (15 U.S.C. 632).
    (b) Study.--
        (1) IN GENERAL.--The Chief Counsel, in consultation with the Director of the United States Patent and Trademark Office, shall conduct a study of the effects of changing from a first-to-invent to a first-to-file invention priority system under patent law under title 35 of the United States Code.
        (2) AREAS OF STUDY.--The study conducted under paragraph (1) shall include examination of the effects of changing from a first-to-invent to a first-to-file invention priority system, including examining--
            (A) how the change would affect the ability of small business concerns to obtain patents;
            (B) whether the change would create or exacerbate any disadvantage for applicants for patents that are small business concerns relative to applicants for patents that are not small business concerns; and
            (C) the costs and benefits to small business concerns of the change.
    (c) Report.--Not later than 18 months after the date of enactment of this Act, the Chief Counsel shall submit to the Committee on Small Business and Entrepreneurship and the Committee on the Judiciary of the Senate and the Committee on Small Business and the Committee on the Judiciary of the House of Representatives a report regarding the results of the study under subsection (b).

Patent Docs thanks David Boundy for alerting us to Senator Landrieu's new bill.

Comments

[EG]

I commend Senator Landrieu for at least asking the highly relevant "$64k" question that no one pushing for modified S.515 has appropriately answered: how does even modified S.515 benefit American small business, and especially American small business innovation? That question is particularly germane as even modified S.515 will create a significant upheavel in how patentability is determined in the U.S. as many of the provisions, including the "grace period" provision, are written with sloppy and ambiguous wording. Until this "$64k" question is addressed to my satisfaction, there's no way I'll support modified S.515.

[6]

I would like to hear the "$64k" question: "how would making business methods and anything remotely considered a software patent unpatentable by decree affect small businesses?" being asked.

I would love to hear it.

[Skeptical]

Isn't that question continuously asked over at techdirt?

[Keep It Real]

The Great Senator from Lousiana: "[s]mall businesses represent 99.7 percent of all employers, employing 1/2 of the U.S. labor force,"

What percentage of small businesses file patents?

What percentage of small businesses are threatened or sued by larger businesses for patent infringement?

[GGF]

Maybe I'm missing something, but I see the first-to-file as an advantage for small businesses.

During litigation, it is difficult to argue with the file date on two different applications. The date is the date, even when you include priority it is relatively simple. First-to-file seems to benefit whoever has the better lawyers and who has better processes to document reduction to practice. A large company will have more and possibly better lawyers, better documentation processes, etc.