U.S. patent reform bill to become law

Rick Merritt SAN JOSE, Calif. – Following a decade of contentious debate, President Barack Obama is about to sign into law a broad and controversial patent reform bill. The U.S. Senate agreed to the bill Thursday in a vote of 89-9….

Rick Merritt

SAN JOSE, Calif. – Following a decade of contentious debate, President Barack Obama is about to sign into law a broad and controversial patent reform bill.

The U.S. Senate agreed to the bill Thursday in a vote of 89-9.  The House approved H.R. 1249 by a vote of 304-117 earlier this year.

The final bill shifts the U.S. from a first-to-invent to a first-to-file standard in an effort to reduce sometimes long and expensive court challenges and come into alignment with other international patent systems. It also creates a new opportunity to challenge new patents at the patent office.

The impact of the bill has been widely debated and probably will be mixed.

Large companies generally praised the bill. They believe it has potential to reduce frivolous patent suits and ease the job of invalidating bad patents. Trade in patents has become a business that hinders innovation for large product companies, they claim.

One provision of the bill gives prior user rights to companies that employ a technology prior to someone filing a patent on it.

Many individual inventors and startups opposed the bill. They believe it will make it harder to win and maintain patents without investing more resources in the process.

Representatives of the two sides squared off in a lively debate in 2009 available on video online.

It’s unclear whether the bill will help what all sides believe is one of the major problems with the U.S. patent system—a backlog of about 1.2 million applications at the patent office and an average three year wait for approval on an application. One inventor recently waited eight years for a patent he considered fundamental for his business.

The new law would let the patent office set and keep all the funds it generates rather than being held to a fixed budget, a provision all sides praised. However, Congress maintains oversight on the patent office, forcing it to get approval each year for any funds it generates over its budget, opening a door that would let lawmakers continue diverting patent office fees if they chose to do so.

“These reforms constitute the most significant change to U.S. patent law in 175 years, since the Patent Act of 1836,” said Representative Lamar Smith (Rep., Texas) who spearheaded the legislation in the U.S. House.

“The America Invents Act will ensure that inventors large and small maintain the competitive edge that has put America at the pinnacle of global innovation,” said Senator Patrick Leahy (Dem, Vermont). “It is long overdue to be signed into law,” he said.

“The America Invents Act, coupled with recent court decisions that provide more clarity and confidence for inventors, puts our patent system in a much better position to spur innovation and economic growth in the 21st century,” said Robert C. Weber, senior vice president, legal and regulatory affairs, and general counsel at IBM which has been awarded the most U.S. patents each year for the last 18 years.