Patent Reform News Briefs

By Donald Zuhn --

Reports Suggest Senate Action on Patent Reform Bill Could Be Weeks Away

In Monday's IPO Daily News, the Intellectual Property Owners Association (IPO) suggested that H.R. 1249, which the House passed on June 23 (see "House Passes H.R. 1249"), might not be brought up by the Senate until after Congress' August recess, which is scheduled to begin on August 6.  The IPO report also noted that while Sen. Patrick Leahy (D-VT) is seeking Senate passage of the bill passed by the House, other Senators are objecting to a few provisions in the bill, including § 37 (the so-called MedCo amendment; see "The Medicines Company Clearing Last Hurdles to Patent Term Extension for Angiomax®"), which would amend 35 U.S.C. § 156(d)(1) by adding the following text:

For purposes of determining the date on which a product receives permission under the second sentence of this paragraph, if such permission is transmitted after 4:30 P.M., Eastern Time, on a business day, or is transmitted on a day that is not a business day, the product shall be deemed to receive such permission on the next business day.  For purposes of the preceding sentence, the term 'business day' means any Monday, Tuesday, Wednesday, Thursday, or Friday, excluding any legal holiday under section 6103 of title 5.

On Saturday, Hal Wegner (at left) stated in his e-mail newsletter that "[a]n early Senate vote is now considered unlikely on the Leahy-Smith America Invents Act, with the strong likelihood that any full Senate consideration will take place at the earliest after Labor Day" (emphasis in original).

A copy of the House bill as it was received in the Senate and placed on the Senate legislative calendar on June 27 can be found here.

Economist Asks Congress to "Let the Patent Office Keep Its Money"

In an Op-Ed published last week by Bloomberg Businessweek, Economist Dr. Scott Shane contends that "[f]ee diversion is wreaking havoc on the patent system and undermining our national competitiveness" ("Let the Patent Office Keep Its Money").  Dr. Shane (at right), a Professor of Economics at Case Western Reserve University, should be familiar to Patent Docs readers for his contributions to the patent reform debate (particularly with respect to patent damages) in 2009 (see "Manufacturing Alliance on Patent Policy: Apportionment of Damages Provision Will Have Adverse Effects"; "MAPP Economist Advises Congress on Damages Provision"; and "Patent Reform Efforts Opposed by Small Business Group").

Noting that between 2000 and 2010 the annual number of applications filed rose 65%, Dr. Shane argues in his article that "[t]o meet this demand, the USPTO needs more patent examiners to handle the greater volume of applications," and that "[b]y taking away a portion of the patent office's fees, Congress has prevented the USPTO from hiring enough examiners to evaluate patent applications in a timely manner."  He concludes that "[i]f the House adopts the Senate's version [of the USPTO funding provisions], fee diversion will end, but if the Senate adopts the House's version, then I'm much less optimistic that the USPTO will get the money it needs to operate successfully."

American Action Forum Urges Senate to Retain USPTO Funding Provisions of S. 23

The American Action Forum, an organization that describes itself as "a forward-looking policy institute dedicated to keeping America strong, free and prosperous," which "seeks to promote common-sense, innovative, and solutions-based policies that will reform government, challenge out-dated assumptions, and create a smaller, smarter government that will serve its citizens better," issued a statement today calling on Senate leadership to prevent fee diversion in the U.S. Patent and Trademark Office.  American Action Forum President Doug Holtz-Eakin, a former Director of the Congressional Budget Office, pointed out that "[e]ach year over $800 million in user fees are diverted away from the USPTO through the Congressional appropriations process."  He urged Senate Majority Leader Harry Reid (D-NV) and Minority Leader Mitch McConnell (R-KY) "to adopt the language in S.23, a bill that will effectively end this process."

In a letter to Sen. Reid and Sen. McConnell, Mr. Holtz-Eakin stated that "[t]he establishment of the Patent and Trademark Fee Reserve Fund in H.R. 1249 would be ineffective in stopping the diversion of fees from USPTO."  In contrast, he explained that "the Senate bill [S. 23] creates a USPTO Public Enterprise Fund at the Treasury Department, which would receive all fees paid to USPTO and which would be available to USPTO when needed," stating that "[t]he funds would not be funneled through the Congressional appropriations process and would, therefore, not be exposed to the threat of being diverted to general government spending."  "If it is, in fact, the goal of Congress to end fee diversion and ensure that the USPTO is authorized to spend the fees it collects from its users," Mr. Holtz-Eakin contended that "the language contained in S.23 is clearly superior to the language of H.R.1249."

Comments

[patent litigation]

The news of a delay should come as a relief to opponents of patent reform. It may be an unrealistic scenario, but considering the circumstances, perhaps Congress will decide that, in the interest of just getting some kind of patent reform passed, it will enact a bill that consists solely of provisions ending fee diversion and granting the USPTO fee-setting authority, and will completely drop all of the controversial provisions (preferably those in the House version). Unrealistic, yes; but we can hope.
http://www.aminn.org/patent-reform-act-2011-s23