By Kevin E. Noonan --
To quote Lawrence (Yogi) Berra, "It’s déjà vu all over again" -- Senator Patrick Leahy (D-VT) (at right), joined by Senators Orrin Hatch (R-UT) and Chuck Grassley (R-IA) are planning to introduce (yet again) a patent reform bill. Stating that "[t]he Patent Reform Act [of 2005 2007 2009 2011] will keep America in its longstanding position at the pinnacle of innovation," the provisions of the bill are discussed generally on Senator Leahy's website.
The bill provides these specific provisions:
Sec. 1. Short title; table of contents.
Sec. 2. First inventor to file.
Sec. 3. Inventor’s oath or declaration.
Sec. 4. Damages.
Sec. 5. Post-grant review proceedings.
Sec. 6. Patent Trial and Appeal Board.
Sec. 7. Preissuance submissions by third parties.
Sec. 8. Venue.
Sec. 9. Fee setting authority.
Sec. 10. Supplemental examination.
Sec. 11. Residency of Federal Circuit judges.
Sec. 12. Micro entity defined.
Sec. 13. Funding agreements.
Sec. 14. Tax strategies deemed within the prior art.
Sec. 15. Best mode requirement.
Sec. 16. Technical amendments.
Sec. 17. Effective date; rule of construction.
The bill is "nearly identical" to the Manager's Amendment of S. 515 from the 111th Congress. It includes similar or identical provisions on venue, best mode, false marking, and easing the residency requirements for Federal Circuit judges. It also contains provisions to "transition" U.S. patents to a "first inventor to file" system (like earlier bills, this is distinct from "first to file" systems abroad, which are based on absolute novelty) and "first window" post-grant opposition provisions.
The bill also contains an effective ban on patents for tax (presumably avoidance) strategies, by considering such methods to be statutorily in the prior art. It continues efforts to harmonize U.S. patent law with the law of foreign jurisdictions by providing for third party submission of prior art to the Office during ex parte prosecution. It also includes two post-grant provisions for reconsideration of a granted patent: a "first window" post-grant opposition (limited to the first 9 months after patent grant), and a revised inter partes re-examination proceeding, with adversarial proceeding before an Administrative Patent Judge before a Patent Trial and Appeal Board, as well as "procedural changes" to permit resolution within 12 months, establishing a "reasonable likelihood" threshold for initiating an inter partes re-exam, and an estoppel standard (for grounds of invalidity not raised during re-examination) precluding the requestor from raising an issue in litigation that "reasonably could have raised" during re-examination proceedings.
The bill also contains the "grand compromise" achieved by Senators Leahy, Dianne Feinstein (D-CA), and then-Senator Arlen Spector (D-PA) on the damages issue, establishing a "rigorous" gatekeeping role for the court in calculating damages and enhanced damages, that will "ensure consistency, uniformity, and fairness." This part of the bill also contains provisions permitting "a party" to request that validity and infringement be decided by the trier of fact before damages are considered (a request that must be granted absent good cause). The bill also codifies the willfulness standard ("clear and convincing evidence that the infringer acted with objective recklessness and the objectively-defined risk was either known or so obvious that it should have been known by the infringer") set forth by the Federal Circuit in In re Seagate, requires that willfulness be plead "with particularity," and mandates that the court cannot find enhanced damages if evidence of infringement, validity or enforceability is "a close case."
The U.S. Patent and Trademark Office does not get its long-desired rulemaking authority in the bill, but it does get fee-setting authority (which it can be expected will be wielded by the Office with an eye to influence applicant behavior, but contains mandates that small entity fees are reduced by 50% and "micro" entity fees are reduced by 75%). Finally, the bill would permit the Office to establish a "supplemental" examination process "to incentivize patent owners to commercialize inventions despite potential flaws in the application process," and keeps provisions from S. 515 to "increase[] incentives for government labs to commercialize inventions."
Patent Docs intends to provide additional coverage of the new bill, with an emphasis on its potential impact on biotech and pharma patent practice, after we have had a chance to analyze the bill, and compare the new bill more closely to previously introduced legislation.
I'd like to add Sec. 18: PTO to accept color images in biotech cases. Its 2011 people, and we're all filing electronically anyway.
Posted by: B | January 21, 2011 at 08:37 AM
Hi Kevin,
Just this morning I got a tip from Greg Aharonian about what the new bill might look like. I haven't had a chance to read it yet, but I am reasonably certain that it will be pretty much the same as the failed 2010 S. 515 bill.
http://www.bustpatents.com/PatRef2011.pdf
I had heard that the bill was going to be about the same again this year, which is only marginally less destructive of patent rights than the bill proposed back in 2007, the S. 1145 bill. It was very interesting that the last bill, S. 515, expired largely because the large high-tech firms that had been lobbying for it so diligently withdrew their support of it when the Senate had to back away from the damages portion of the bill to have any hope of it's passage or even getting it to the Senate floor for debate and a possible vote. Has anybody heard yet when the new bill might be brought out of the judiciary committee to the Senate? I think I need to quaff about 2 or 3 quick glasses of Kool-Aid this morning!
Cheers,
Stan~
Posted by: Stan E. Delo | January 21, 2011 at 09:06 AM
If he put a section in about gene sequences presumed to be in the prior art as well he'd get this thing a sailin' thro.
"I'd like to add Sec. 18: PTO to accept color images in biotech cases. Its 2011 people, and we're all filing electronically anyway."
They still don't print right at publishing time tho. If you could get them to start publishing in some limited color then that'd be coo. Maybe increase your filing fee to cover whatever costs.
Posted by: 6 | January 21, 2011 at 12:30 PM
Reality check, 6 - Congressman Beccera has introduced his anti-gene patenting legislation at least twice, and the result has been the Congressional equivalent of the sound of crickets. But what I wouldn't mind is a hearing where folks who actually understand patent law and genetic technology got a chance to explain it to the rest of the populace - that would open a few eyes.
Posted by: Kevin E. Noonan | January 21, 2011 at 12:49 PM
"Reality check, 6 - Congressman Beccera has introduced his anti-gene patenting legislation at least twice, and the result has been the Congressional equivalent of the sound of crickets. But what I wouldn't mind is a hearing where folks who actually understand patent law and genetic technology got a chance to explain it to the rest of the populace - that would open a few eyes."
Wait, wasn't that you on national television not long ago?
Again, let's talk reality check.
Posted by: 6 | January 21, 2011 at 01:25 PM
Kevin,
The Phoenix of S. 515 once more rises from the ashes. What it proposes is unnecessary (such as the provision on damages in view of Lucent and ILOC), won't help where it's needed most (i.e., the patent examination process), will create disadvantages for innovative American small businesses (e.g., first to file), and will add burdens which the USPTO won't be able to handle (post-grant oppositions). If only Congress would simply let sleeping dogs lie.
Posted by: EG | January 21, 2011 at 03:04 PM
I expect the hearing would last more than 45 seconds. And hope that the Members of Congress were more interested in the facts than a good "story."
Posted by: Kevin E. Noonan | January 21, 2011 at 03:53 PM
I haven't checked out the text yet, but from the synopses I've read it sounds like Leahy didn't include any provisions for discontinuing fee diversion in his supposed "patent reform" bill. Is he for real? I realize that, as a congressman, he might not be too eager to cut off a source of revenue for the legislature; but enough is enough. Also, I think this proposed legislation has way too many contentious issues to pass. If Leahy really wants to enact patent reform, I suspect that he may have to be somewhat less ambitious and more incrementalist in his approach.
http://www.washingtontimes.com/news/2010/may/25/patent-reform-misses-the-mark/
Posted by: patent litigation | January 31, 2011 at 02:27 PM