Patent Reform in the Senate

  • The Senate continues an internal struggle over patent reform. Although a majority of Senators support the proposed reform measures, the majority does not yet have the 60 votes necessary to close debate. 
  • Although the Democrats have been more strongly supporting patent reform, the Senate Bill (S.1145) is clearly bi-partisan. Co-Sponsors include the following Republicans: Orrin Hatch; John Cornyn; Larry Craig; Michael Crapo; Gordon Smith; Roberts; Bennett. Co-Sponsors include the following Democrats: Pat Leahy; Ken Salazar; Chuck Schumer; Sheldon Whitehouse.
  • The reform measures (already passed in the house) would make numerous changes to the patent laws, including:
    • Force a large number of patent infringement suits to be filed in the defendant’s home court;
    • Reduce damage awards for infringement and require specific proof of market value of invention as compared to the closest prior art;
    • Limit enhanced damages to a specifically enumerated subset of willfully infringing actions;
    • Create a new, expanded post-grant opposition procedure (specific rules to be created by the PTO);
    • Create expanded right to submit third-party prior art;
    • Change to a first-to-file system (creating a whole new set of prior art);
    • Provide enhanced regulatory authority to the PTO (So that it can enact the continuation changes). . .
  • Patent reform is an area quite friendly to horse trading and votes are much more easily changed than areas with a greater potential voter response. Few Senators will gain or lose votes based on their patent reform vote.

44 thoughts on “Patent Reform in the Senate

  1. “There was no way Lessig’s effort at the Supreme Court in Eldred was going to prevail”

    Not with Lessig in charge, anyway.

  2. patent value and common interests

    with regards to prof. lemley (who is listed as a patent litigator with keker & van nest) and the papers cited by Mr. Schindler … who i must thank and express gratitude for sharing insights and nuance that have been truly invaluable — there is plenty of room for efforts to expand the debate. the tactics involved by the proponents has been a truly amzing effort –

    … prepared with nathan myhrvold, mr. lemley proposes a market that prices patents using the stock market as a proxy??? … titled “How to make a patent market” – how does one know the value of a patent before there is a market for goods and services that incorporate patented technology? what company can go publis with patents alone (how about with no royalties) offensive or defensive interpretations as well as the so-called trolls, patent auctions, provide their own analysis on any number of models to interpret risk/reward — the notion by lemley and myhrvold of a “blind” market is a perversely odd way to characterize making a “market” for patents. it’s akin to saying the property you own must always be a warehouse, while the purchaser can wait to convert to lofts, denying you the right to higher economic rents…

    it makes this odd point, IMHO, but how can a patent be valued competitively and not under duress when said patent may only be appealable to a monopsonist?

    abstract is at: link to papers.ssrn.com (dennis i think the link is allowable as an abstract)

    in light of the recent claims concerning the value of the so-called fair use economy (link to ccianet.org) … place 600 billion of added economic activity … in contrast with piracy estimates, there are a number of ways to start encouraging counter-analysis (some of which has started to emerge) for value-add in patents, not just RIMM, Lemelson, submarine patents, et al… Japan has it’s Dr. Nakamatsu – not sure if he still has his huge billboard near the American Embassy…

    but a potentially reasonable course may be best served by developing better stories for public consumption which would appear to be a fraction of the cost of what will likely be an ongoing debate…

  3. Separate from the lack of knowledge of patent law manifested by many of the intellectual property academics, there is an odd daisy-chaining behavior in many of the publications.

    For example, Lemley in his rational ignorance paper (95 Nw. U.L. Rev. 1495), cites to the (then) unpublished work of Quillen and Webster:

    The Quillen-Webster study suggests, moreover, that they ultimately issue an astonishing ninety-seven percent of the unique applications filed. n126

    [with the reference amounting to Cecil D. Quillen, Jr. & Ogden H. Webster, Continuing Patent Applications and Performance of the U.S. Patent Office (2000) (working paper, on file with author).]

    In turn, Quillen and Webster in their second paper (12 Fed. Cir. B.J. 35) cite to Lemley:

    Numerous authors have addressed the problem of USPTO quality. See Mark A. Lemley, Rational Ignorance at the Patent Office, 95 NW. U. L. REV. 1495 (2001);

    Quillen and Webster also cite an unpublished manuscript, which to date I have been unable to obtain from Professor Wegner:

    Harold C. Wegner, Enronesque Patent Bookkeeping: Two-For-One Continuation Double Counting and American Patent Flooding (June 14, 2002) (unpublished manuscript, on file with author at Foley & Lardner).

    Turning full circle, in his July 2007 paper on SSRN, Lemley effectively says (of the 97% business): just kidding guys; the number isn’t so high after all.

    (Originally written by Lawrence B. Ebert, a patent attorney locted in New Jersey, and posted on The Patent Prospector, on Friday, August 24, 2007 8:52 AM)

  4. IPBiz
    Intellectual property news affecting business and everyday life
    Monday, May 21, 2007
    Mark Lemley is not a patent attorney
    With reference to an IPBiz post on Sunday, May 20, I was duly chastised by an IPBiz reader for including text suggesting Mark Lemley was a patent lawyer. He isn’t; IPBiz believes Lemley’s undergrad degree was in economics, which would make it difficult for Lemley to sit for the patent bar.

    The IPBiz reader noted:

    Noticed this from your Sunday blog entry:
    “Stanford professor Mark Lemley, a noted patent lawyer……”

    He’s not a patent lawyer as far as I can tell.

    The text about Lemley in the May 20 post originated from an Associated Press [AP] story on “how great” things are for patent attorneys. Things aren’t great for all patent attorneys, contrary to the suggestion of AP, and Mark Lemley isn’t a patent lawyer, contrary to AP. Just goes to show you that you can’t believe everything you read in the newspapers. IPBiz and Captain Renault are shocked! Those of you reading Terri Somers in the San Diego Union Tribune might think that Thomson ignored the work of Ariff Bongso in Thomson’s ’780 patent. Such people would be wrong.

    IPBiz had earlier discussed Lemley’s assertion, published in the Stanford Law Review, that Gary Boone invented the integrated circuit (IC). Contrary to the Stanford Law Review, Gary Boone did not invent the integrated circuit, but one might check out two fellows by the names of Noyce and Kilby.

    **
    The AP article by Maryclaire Dale, appears in the IHT under the title: Have a science degree? Become a patent lawyer

    ***
    One board had the post:

    When you read articles like this one, it means it is time to avoid patent law like the black plague. It is sort of like becoming a petroleum engineer in late 1970′s, an anti-trust lawyer in the 1980′s, a defense contractor in the early 1990′s, an Internet guru or a stock broker in 2000, or a real estate agent in 2006. Don’t get caught up in the hype, the bubble has burst.”

    The board also had a post:

    Who are the real IP superstars? There is no doubt that Lemley and Lessig have very high profiles in the academic community. However, do they, and some of the others, have true knowledge of IP, especially patents? There seems to be a fundamental disconnect between “real IP” and “academic IP,” with the academic folks engaged in quests unrelated to truly important issues. There was no way Lessig’s effort at the Supreme Court in Eldred was going to prevail, and Lemley’s comments on continuations are naive and misguided.

    AND

    While I think Mark Lemley is a smart guy, there is no accounting for some of the statements he made in that infamous law review article on this subject. Search previous posts for discussions of some of the errors he made, which many found to be misrepresentations. You are going to have to find a bit better source if you are to be taken seriously.
    (Originally written by Lawrence B. Ebert, a patent attorney located in New Jersey, and posted on IPBiz on Monday, May 21, 2007, at 9:09 AM)

  5. “Litigators are the ones that take bad patents and stretch them like taffy to cover basic stuff that is prior art.”

    They only do that because they can.

    If judges and their clerks made sure that attorneys applied the law correctly, a lot of the nonsense would stop.

    But not all of it. Again, courts haven’t yet reached the peak of the bad biotech and software patents that have issued and are waiting to be invalidated.

    The new rules are PTO’s way of covering its butt before the public smells a bunch more one-click rats rotting under the hood.

  6. By the way, what is a “bad” patent?

    My best understanding of this term is that it excludes ALL patents obtained for one’s own clients.

    Further, even if a “bad” patent is, perhaps, defined as a patent likely to be held “not valid” is ever litigated, it seems doubtful that prospectively objective law, either statutory or administrative rules, can clearly be written to “include” only “good” patents and “exclude” all the “naughty” ones!

  7. There is no fair or balanced Bill if the Bill authorizes the new USPTO rules. These rules are a travesty to anyone who needs a patent. Unfortunately, large coporate America does not need patent protection. They only need semblance of it. Hence, why they are pushing for the rules.

    Second, and most importantly, patent reformers and the USPTO both neglect the consideration that good patents come from good patent attorneys, and in order to promote good patents, one must give reason for a good attorney to want to do patent work. There is the attitude that prosecution is monkey work. Personally, I don’t want to make a bunch of prior art characterizations so that some litigator who had 2000 hours to bill reading the same references with experts can screw me into the ground during a deposition and then havemy name splatted on the Fed. Cir opinion. My malpractice insurance is plenty expensive and only goes up to 3 mill. Reform and patent rules are not inducive to a good attorney wanting to practice this difficult field.

    Frankly, all this is just an example of litigators spending past decade or so ****ing on where they eat, and then complaining about it when it starts smelling bad. Litigators are the ones that take bad patents and stretch them like taffy to cover basic stuff that is prior art. We are in need of patent litigation reform, not patent reform. A litigator is the one who won’t let the client file a reexam, or let the patent attorney or client see the prior art in discovery (wven when there are cons pending), or construe claims without consulting the patent attorney as to what was intended.

  8. Edwin – thanks for the update! As for the expanded rulemaking authority in the patent reform legislation, I thought I read a while back that a similar provision is in place for other federal agencies. (Of course my recollection may be faulty) If true, I would think that the grant of such “expanded” rulemaking authority has already been tested in court. Can anyone else shed some light on the issue? Also, it seems to me that the 60-day window for Congressional veto is pretty meaningless these days – I cannot imagine Congress getting anything done within that time frame unless the situation was pretty egregious or there was some other extraordinary situation. (on a completely unrelated note, I heard recently that more people believe that 9/11 was a government conspiracy than those who think Congress is doing a good job)

  9. I think that after the “mess” the PTO has made with its proposed Rule changes, metaphysically scheduled to take effect on November 1st, Congress will have to think long and hard about handing the PTO any substantive rule-making authority, which would be tantamount to handing a loaded gun to a baby.

    GSK’s Reply Brief cites to a letter from Sen. Charles Schumer to the PTO, dated October 25, 2007, requesting that the PTO voluntarily delay implementation of its proposed Rule changes, pending the outcome of the legal challenge in the Eastern District of Virginia.

    Obviously, the PTO did not agree to Sen. Schumer’s request, but the letter indicates that the PTO’s actions have now gotten the attention of Congress.

    The reform bill that passed the House, from what I understand, would have provided the PTO with substantive rule-making authority as to continuations, subject to a 60-day waiting period, during which Congress could block any proposed Rules. Putting to one side whether such a Congressional “veto” would be constitutional, even currently proposed reforms don’t seem to grant the PTO the full authority to “legislate” as it is now trying to do with its current, and more limited, rule-making authority.

    This episode in “presumed” PTO rule-making authority, if anything, would seem to significantly reduce the likelihood of any patent reform bill passing that would grant the PTO the rule-making authority it might otherwise have received.

  10. “Your summary of the bill as passed in the House is a bit unfair. A few corrections:”

    Don’t let the facts get in the way of a good lynching.

  11. In light of the fact that H.R. 1908 would ratify the USPTO’s new Claim and Continuation Rules, new IDS rules, etc., Mr. Lemley’s comment below is laughable:

    “I think the bill is actually pretty balanced right now. People can disagree, of course, but they should do so on the basis of the facts, not a selective listing of only the features that point in one direction.”

    And here are some “facts”:

    Fact 1: Most of the problems with respect to the USPTO issuing bad patents and having a large backlog are because USPTO management has mismanaged the USPTO, see the recent GAO report:

    /media/docs/2008/08/d071102.pdf

    Fact 2: The USPTO has attempted to justify its New Rules based on a host of allegations that have little or no factual support, see recent the recent submission to the OMB by Richard Belzer, a former OMB Economist, about the new IDS rules:

    link to whitehouse.gov

    Fact 3: If H.R. 1908 were to be adopted as law, thereby allowing the USPTO to pass rules (that the USPTO has indicated it would like to pass) requiring ESD type submissions by all (or nearly all) applicants for all applications, patent applicants would be better served by a registration system than by the examination system USPTO. Once applicants effectively have to do a search for an application and provide comments on the result of the search, the benefits of the presumption of patent validity will in almost all cases be far outweighed by the ease with which an infringer to allege inequitable conduct to invalidate the patent.

    Whatever amount of money a patent applicant can spend on a search for a patent which may or may not have economic value, a defendant in an infringement suit can always spend many times as much money to do a search to invalidate the patent in the hope of finding some document somewhere that a “reasonable examiner” might have considered of interest. For example, can you say with a straight face that even if a patent applicant spent $20,000, more than the cost to prepare most patent applications, to prepare an ESD-type document that it would not be worthwhile for an infringer to spend $40,000, $60,000 or even $100,000 (if the patent is valuable enough) to find documents to invalidate the patent?

    In light of Facts 1, 2 and 3, H.R. 1908 looks wildly unbalanced to any objective observer that understands both patent prosecution and patent litigation.

  12. In light of the fact that H.R. 1908 would ratify the USPTO’s new Claim and Continuation Rules, new IDS rules, etc., Mr. Lemley’s comment below is laughable:

    “I think the bill is actually pretty balanced right now. People can disagree, of course, but they should do so on the basis of the facts, not a selective listing of only the features that point in one direction.”

    And here are some “facts”:

    Fact 1: Most of the problems with respect to the USPTO issuing bad patents and having a large backlog are because USPTO management has mismanaged the USPTO, see the recent GAO report:

    /media/docs/2008/08/d071102.pdf

    Fact 2: The USPTO has attempted to justify its New Rules based on a host of allegations that have little or no factual support, see recent the recent submission to the OMB by Richard Belzer, a former OMB Economist, about the new IDS rules:

    link to whitehouse.gov

    Fact 3: If H.R. 1908 were to be adopted as law, thereby allowing the USPTO to pass rules (that the USPTO has indicated it would like to pass) requiring ESD type submissions by all (or nearly all) applicants for all applications, patent applicants would be better served by a registration system than by the examination system USPTO. Once applicants effectively have to do a search for an application and provide comments on the result of the search, the benefits of the presumption of patent validity will in almost all cases be far outweighed by the ease with which an infringer to allege inequitable conduct to invalidate the patent.

    Whatever amount of money a patent applicant can spend on a search for a patent which may or may not have economic value, a defendant in an infringement suit can always spend many times as much money to do a search to invalidate the patent in the hope of finding some document somewhere that a “reasonable examiner” might have considered of interest. For example, can you say with a straight face that even if a patent applicant spent $20,000, more than the cost to prepare most patent applications, to prepare an ESD-type document that it would not be worthwhile for an infringer to spend $40,000, $60,000 or even $100,000 (if the patent is valuable enough) to find documents to invalidate the patent?

    In light of Facts 1, 2 and 3, H.R. 1908 looks wildly unbalanced to any objective observer that understands both patent prosecution and patent litigation.

  13. On venue: H.R. 1908 does include specific exceptions that institutions of higher learning and non-profits (including a special exception for licensing companies such as WARF). Those entities would be allowed bring suit where they reside. Other companies can also bring suit in a jurisdiction where the company has a substantial amount of “research and development”, “manufacturing activities”, or “management of those activities” if those activites are related to the patent in suit.

    I have not seen numbers on this, but I would suspect that this would have altered venue decisions for at least 1/3 of currently pending patent cases.

  14. Mark, I agree that the the willfulness changes are not as severe in the face of Seagate. However, the proposed legislation is still a further limitation. In particular, a patentee would be required to show one of the following: (1) copying that occurred after the defendant knew that the copied product was patented; (2) post judgment continued infringement in the same manner; or (3) continued infringement after “receiving written notice from the patentee” that includes a claim-by-claim analysis of each accused product. These tightly worded provisions leave some large holes for traditional ‘willful infringement’ that would not be considered willful — including: releasing a new product that is known to be infringing but that was not identified in the patentee’s letter; continuing to willingly infringe a patent because the written notice was deficient in form.

    Further, a defendant would have a statutory defense to willfulness if it provided “evidence that the infringer sought to modify its conduct to avoid infringement once it had discovered the patent” (Note that the lack of ‘reasonableness’ in the statutory language).

    Finally, although I have not seen any statistical data on this issue, conventional wisdom is that bifurcation of infringement and willfulness issues helps defendants. Patentees like to have them all together — that way they can show that the defendant was a ‘bad actor’ even if that issue is not relevant to the strict liability tort of infringement. The new law would bifurcate those issues.

  15. Prof Lemley,
    You left out the most important part of the bill – DAMAGES !
    How can the bill be “balanced” if the damages provision could DRASTICALLY the amount of damages recoverable in litigation ???
    This is a double whammy in light of Ebay which eliminates automatic injunctions.
    If this bill is so balanced, how come all of the serial patent infringers (including the financial services companies who have almost NO patents have CERTAINLY have no interest in strengthening patent protection) are vigorously supporting the bill, while “pro-patent” corporations oppose the bill?

    Thanks,
    AnonymousAgent

  16. Dennis -

    Your summary of the bill as passed in the House is a bit unfair. A few corrections:

    1. first to file will take effect only after the PTO certifies that Japan and Europe have adopted a grace period. Don’t expect to see it in effect for decades.

    2. after Seagate, the willfulness bill actually is pro-patentee, because while it imposes procedural limits, it also changes the standard back to due care from recklessness.

    3. the venue provisions have huge exceptions for individual inventors, universities, and anyone who makes a product or supervises R&D.

    Also, you didn’t mention a bunch of pro-inventor provisions in the bill: (1) eliminating invalidity based on incorrect inventorship; (2) eliminating invalidity based on best mode; and (3) making it harder to prove inequitable conduct, and reducing the penalties if you do engage in inequitable conduct.

    I think the bill is actually pretty balanced right now. People can disagree, of course, but they should do so on the basis of the facts, not a selective listing of only the features that point in one direction.

  17. Obama appears to be pro-personalized medicine based on the fact that he sponsored the Genomics and Personalized Medicine Act of 2007 (S.976). See link to thomas.loc.gov:

    Don’t giggle before you find out the facts first.

  18. Mark (and anonAnonAnon):

    The horse-trading was on two levels re:financial services – Rep. Boucher (who was also very active in trying to get a Fair Use rights for consumers enacted within the DMCA) pushed for the tax planning amendment (not a word was spoken re:Fannie Mae patent on applying for mortgages – #7,089,503, titled “Mortgage loan customization system and process”). However, Sen. Sessions pushed for exemptions for banks to avoid payment of patented technology (DataTreasury is the patent-holder) relating to the conversion of paper checks to electronic form (not sure how this fits within the greater Check21 initiative).

    Separately, the horse-trading for this bill is all over the map as most constituents have no clue what a patent is … with all due respect my advice is not limit your efforts with your own Senators but to also get a letter to Sen. Feinstein (congress.org has a related company which will hand deliver letters at $8.95 per and $500 for all members of Congress) who is an alleged very strong swing vote and any others you feel have a link to your art. The House bill was fairly bi-partisan but it was the Dems who voted in the majority for the Bill…

    I agree with Mark’s observations. And, believe that should also be done on a consistent basis as again there are few if any who have a solid understanding of the details of the impact of the legislation.

    valuations :: In most fields new products (or “NEW” & “IMPROVED” products introduced within an 18 month period up to the present) acount for a large percentage of value attrbuted by financial analysts … how each is valued is a bit tricky (but one way to aproach the subject with your Senator’s staff) — Gillette razors have 10s of issued patents as one example but have extremely strong brand recognition as well that accounts for intangible value…

  19. “I am curious, how much people think US patents would be devalued by if this passes.”

    anonAnonAnon,

    I’ve actually been contacting my Senators’ offices to encourage them to introduce amendments to the bill which might be able to actually increase the value of patents.

    Several of my clients, for example, would like to see 35 USC 2 amended to specifically authorize the USPTO to hire consultants in the financial services industry on an interim basis to assist examiners in understanding the basic underlying concepts of financial service patents. Examination of these patents would be a lot more efficient, for example, if examiners could call up experts on an as needed basis to learn what an unfamiliar term of art meant, rather than try and figure it out for themselves.

    More efficient examination = greater patent value.

    I have found that it is very effective to call a Senator’s office and ask for the aide handling the patent reform bill. They are good about returning phone calls and discussing a particular issue with constituents.

    One aide had some particularly helpful advice. He suggested that the Senator might be open to the amendment we were proposing if it was supported by one or more financial service industry groups, such as the American Bankers Association (the other ABA). That’s how the amendment banning tax planning patents go into the House bill. It was supported by an organization of tax accountants.

  20. Someone wrote:”Obama (bc he is pro-personalized medicine)”

    Too funny.

    Is this the new euphemism for “socialized medicine”?

    You want to know about “pro-personalized” medicine (still giggling here)?

    Go to the beaches of Maine. When you see the folks with the really obvious, jagged scars from prior surgeries – - – them’s the Canadians.

    Apparently, their version of “pro-personalized” medicine doesn’t allow for a lotta detail work on the close up.

  21. Hi Stan

    Good luck on getting out of the micro entity status! :) All you need to do is be creative enough to file six patent applications (which under the New Rules could be only a single application containing two patentably distinct inventions for which you have filed two continuations for each restrictable patent family)

    I would advocate for a computer automated search and pre-examination over the ESD/ASQ mess. I am much more comfortable with something along the lines of Google relevance scores than I would be with the wide range of submissions that will inevitably be submitted as part of an ESD/ASQ – all of which are likely to be tickets for allegations of inequitable conduct and/or prosecution history estoppel in the event that anyone might ever seek to enforce a patent that survives this new gauntlet being built by the PTO.

  22. Roger that Anon E. Moose… It seems as if D&D are doing a lot of back-pedaling these days, as they have decided now that the Rules changes will in fact not be retroactive. According to their official response today to the court in re the amicus briefs filed by GSK and AIPLA, they seem to be trying to say that the AIPLA brief should not be allowed, because it came too late. In a totally mind-bending stretch of logic (circa page 14 or 15) they also seem to be trying to say that no harm has been/will be done to Legal firms or their clients, but that if the rules are not allowed to be implemented, the loss of time and effort by legal firms to adapt to the new rules will be a total loss?!? Sounds like Jon trying to call Mom and Dad and get them to bail him out of jail or something like that. In my opinion, the whole thing hinges upon getting the Patent Reform jammed through Congress, and now that it has been hung up for a while, they are looking at being convicted of *inequitable conduct* for exceeding their rule-making authority, which of course the Patent Reform would *fix* for them. I sure wish it was possible for me to attend the hearing on Halloween, just to see who did or did not show up. I heard an Attorney say that he was thinking of showing up for it dressed as the Grim Reaper, which I found to be very funny and appropriate. D&D might be able to get AIPLA disallowed at the hearing, but GSK is Not going to just go away…. Can you say BOO?

  23. From me bretheren anon @ 1:57 PM above:
    —-
    With all the work done to fight the continuation rules judicially, it would be a shame if this bill passes and Mr. Doll can sit smugly saying he was right to enact the rules after all.
    —-

    I think ratification by Congress of the new rules is akin to a Presidential pardon: If you accept the pardon, it means you were guilty. Likewise, if it took Doll going to Mom and Dad in Congress to say the rules were OK, then they weren’t OK without that blessing.

  24. “The WORST of all the provisions is not even mentioned in the summary – namely the language in HR 1908 that authorizes the PTO to require search reports from all applicants other than micro-entities (a new select group of inventors probably smaller than the number of pages required to establish this exception in the bill).”

    Hi Brad… Although I fit the *miro-entity* category right now, hopefully that will change in the near future. My understanding is that the ESD will magically become an Applicant Submission Quality document, if the Patent Reform bill is passed. Perhaps Mr. Dudas thinks I should do Both if I exceed the claim limits? An inquiring mind would really like to know…. It would make my patent application costs at Least triple, but that isn’t really the worst part of it, IMHO. The AQS would require both the Attorney and inventor to first take over the job of the Patent Examiners, as regards researching prior art, and then demand that the Attorneys and inventors effectively *testify* against their own patent application? This smacks of violating my 5th Amendment rights, as regards not being required to incriminate myself. It also creates a very *interesting* ethical puzzle for my Attorney, because they are *required* to make arguements/testimony against their clients’ best interests, and by the way, they might be dis-barred if they can be found to be hiding any prior art that they were *supposed* to know about. By the way, the Patent Office Professionals Association spoke out against this kind of nonsense about 2 months ago, because obviously letting the inventor do his own search instead of a third party (the examiner) is rather a lot like letting the fox be in charge of the Hen-house. It also muddies the waters, if you will, so when push comes to shove, it will be very difficult to figure out where the fingers should be pointed.

  25. Dennis, Dennis, it’s not about votes. It’s about lobbying money. If the issue is settled, then no money pours in during this election year. That translates into votes. No money mean less votes. They pulled this same stuff with the gun issue until 1994. After that it was taboo.

  26. How can they even consider discriminating against financial players who don’t make products by making them sue in the defendants jurisdiction of incorporation? That’s absurd and probably unconstitutional.

    The better question is how they could structure the forum issue so as to allow the defendants to use the same courts not open to plaintiff’s just by having an R&D center in the jurisdiction? Do they really think no one will notice this little game from the techies?

    Clearly, everyone wants smart judges when they are the plaintiff but not so when they are defendants. Rather, make em sue us in the jurisdiction best for us.

    The whole thing reflects the level of competence behind this Bill.

  27. The WORST of all the provisions is not even mentioned in the summary – namely the language in HR 1908 that authorizes the PTO to require search reports from all applicants other than micro-entities (a new select group of inventors probably smaller than the number of pages required to establish this exception in the bill).

    While patent attorneys everywhere plot strategies for avoiding the dreaded ESD under the New Rules, it is clear that the PTO wants all of us to be saddled with these kinds of ESD/Search Report labors going forward.

  28. The USPTO is attempting to “work” Congress to have them clarify that 35 USC 120 *never* in fact meant what both Congress and the courts have said it meant… and that the USPTO has had the power all along to regulate continuations. Perhaps the main battle this week will be on Capitol Hill, not in Alexandria. I’d bet the USPTO will try to pull out all stops to get the below “Clarification” language (from H.R. 1908) passed in S.1145 in an attempt to torpedo GSK’s “ultra vires” argument:

    SEC. 14. REGULATORY AUTHORITY.

    (a) Regulatory Authority- Section 2(c) is amended by adding at the end the following:

    `(6) The powers granted under paragraph (2) of subsection (b) include the authority to promulgate regulations to ensure the quality and timeliness of applications and their examination, including specifying circumstances under which an application for patent may claim the benefit under sections 120, 121 and 365(c) of the filing date of a prior filed application for patent.’.

    (b) Clarification- The amendment made by subsection (a) clarifies the scope of power granted to the United States Patent and Trademark Office by paragraph (2) of section 2(b) of title 35, United States Code, as in effect since the enactment of Public Law 106-113.

  29. I just wrote to my senators, as well as Obama (bc he is pro-personalized medicine… and hence should be pro- R&D) and Clinton and the two Democrats that sponsored the Bill.

    I indicated that the strength of our country is founded, in part, innovation and technology which is driven by a strong patent system… and then asked them why they would support a bill that is unpatriotic and arguably unconstitutional (the part that gives the USPTO the right to do whatever the heck it wants… with no requirement to answer to Constitutional rights).

    I recommend everyone else does the same… it’s very easy. Go to link to senate.gov, find your senator and click on the link. The new page will have a link to send an email.

  30. I just wrote to my senators, as well as Obama (bc he is pro-personalized medicine… and hence should be pro- R&D) and Clinton and the two Democrats that sponsored the Bill.

    I indicated that the strength of our country is founded, in part, innovation and technology which is driven by a strong patent system… and then asked them why they would support a bill that is unpatriotic and arguably unconstitutional (the part that gives the USPTO the right to do whatever the heck it wants… with no requirement to answer to Constitutional rights).

    I recommend everyone else does the same… it’s very easy. Go to link to senate.gov, find your senator and click on the link. The new page will have a link to send an email.

  31. I just wrote to my senators, as well as Obama (bc he is pro-personalized medicine… and hence should be pro- R&D) and Clinton and the two Democrats that sponsored the Bill.

    I indicated that the strength of our country is founded, in part, innovation and technology which is driven by a strong patent system… and then asked them why they would support a bill that is unpatriotic and arguably unconstitutional (the part that gives the USPTO the right to do whatever the heck it wants… with no requirement to answer to Constitutional rights).

    I recommend everyone else does the same… it’s very easy. Go to link to senate.gov, find your senator and click on the link. The new page will have a link to send an email.

  32. You need to know someone on the inside to understand what is really happening.

    ——————————————————–

    Slip ‘em a Mickey, would you?

  33. “Bierbelly, why would that cure the problems with the patent system?? What about those of us in the software industry that rely on patent protection as any other industry does?”

    Aren’t you the same industry that argued “the patent system works too slowly for us…the technology claimed would be obsolete by the time a patent issues”; and “patents are impeding innovation in our field”? Or, are you a troll? ;^)

  34. The hearings on these things are largely for show. The real action is going on right now via phone, email and quiet conversations in the hallways of the Senate. You need to know someone on the inside to understand what is really happening.

  35. Bierbelly, why would that cure the problems with the patent system?? What about those of us in the software industry that rely on patent protection as any other industry does?

  36. Is this thing really going to pass? With all the work done to fight the continuation rules judicially, it would be a shame if this bill passes and Mr. Doll can sit smugly saying he was right to enact the rules after all.

    The sad part is, I don’t think most senators really understand what they are signing, especially the part about the continuation limits.

  37. 35 USC 101–Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, >>except for algorithms for business methods or computer processes<< may obtain a patent therefor, subject to the conditions and requirements of this title.

    Watch the perceived “problems” with the entire patent system evaporate.

  38. Has anyone considered the tax implications of this bill?
    If patents are devalued, then tens of billions and maybe hundreds of billions of dollars in assets will be “wiped off the books.”
    In this case, couldn’t the companies whose patents are devalued receive a write-off for their devalued assets ??
    I am not a CPA and not a lawyer, but it seems that they could.
    Thus, this could cause the Fed Gov’t to lose BILLIONS.
    And for what??? So Bill Gates can get a little richer.

    I am curious, how much people think US patents would be devalued by if this passes.
    I’d be curious to hear Mark Nowotarski’s view of this.

  39. Has anyone considered the tax implications of this bill?
    If patents are devalued, then tens of billions and maybe hundreds of billions of dollars in assets will be “wiped off the books.”
    In this case, couldn’t the companies whose patents are devalued receive a write-off for their devalued assets ??
    I am not a CPA and not a lawyer, but it seems that they could.
    Thus, this could cause the Fed Gov’t to lose BILLIONS.
    And for what??? So Bill Gates can get a little richer.

    I am curious, how much people think US patents would be devalued by if this passes.
    I’d be curious to hear Mark Nowotarski’s view of this.

  40. * Force patent litigation to be filed in the defendant’s home court . . .

    Effect: Reduce litigation by increasing costs to Plaintiff and increasing likelihood of friendly jury/judge.

    * Reduce damage awards for infringement and require specific proof of market value of invention as compared to the closest prior art.

    Effect: Reduce litigation by decreasing potential recovery to patent holder.

    * Limit enhanced damages to only a small subset of willfully infringing actions

    Effect: Reduce litigation by decreasing potential recovery to patent holder. Indirectly this will encourage infringers to more boldly infringe – if the end result is that your liability will not be substantially larger than your gain, then infringement will go way up.

    * Create a new, expanded post-grant opposition procedure (specific rules to be created by the PTO)

    Effect: Increase the cost of obtaining patent protection, thereby decreasing the number of patented inventions.

    * Create a new right to

    This one I’ll need more on Dennis.

    * Change to a first-to-file system (creating a whole new set of prior art);

    This one makes good sense.

    * Provide enhanced regulatory authority to the PTO (So that it can enact the continuation changes). . .

    Whatever.

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