Patent reform bill aims to streamline approval, spur job creation

patent approval

The antiquated U.S. patent system, overwhelmed by advancing technology, has a backlog of more than 700,000 patent applications. Image: CC davidflanders/Flickr

The U.S. Patent and Trade Office is outdated, inefficient and overwhelmed by technological evolution. After being all talk and no action for years on patent reform, congress appears on the verge of overhauling a U.S. patent system that hasn’t changed since 1952. Authors of the patent reform bill aim to decrease the patent application backlog and increase the patent office budget, moves that patent experts say could create millions of jobs.

Patent reform: “millions of jobs lying in wait”

The patent reform bill was a slam dunk in the Senate earlier this month, passing with a 95 to 5 vote. This week the House is debating its own version of patent reform. The Senate version of patent reform will have a tougher time in the House because although most lawmakers agree that patent reform is necessary, they don’t agree on how to go about it. Six decades of stagnation in the U.S. Patent and Trade Office while technology has advanced by leaps and bounds has led to a backlog of more than 700,000 patent applications and an average three year wait for patent approval. David Kappos, director of the USPTO, who testified before the House Subcommittee on Intellectual Property on Wednesday, said that key provisions in the bill could halve the current backlog, shorten the wait to about a year and create “millions of jobs lying in wait.”

Key provisions of patent reform

Each year the USPTO accepts about 500,000 patent applications. Congress sets the USPTO budget, determines the fees it can charge and spends some of the revenue on programs unrelated to patent approval. The most significant change in patent reform would allow the patent office to create its own fee structure and keep all the money. Kappos said the USPTO would have an extra $300 million a year to hire more staff and invest in a state-of-the-art patent review and approval system. Patent reform would also help keep patent disputes out of the courts by allowing the USPTO to look at commercially viable patents a third party tries to invalidate, which is currently done through litigation. The most controversial aspect of patent reform may be changing the U.S. patent system from first-to-invent to first-to-file.

First-to-file provision a sticking point

The first-to-file provision in patent reform has generated the most opposition so far. Opponents of the Senate version of patent reform content that changing from first-to-invent to first to file could hurt small inventors because large companies have far greater resources for filing patent applications. Currently, a small inventor that proves it has beat a large competitor to an innovation gets the patent, regardless of whether the big company filed first. The bill’s opponents also believe that the third party review is just adversarial litigation by another name that will force smaller inventors to give up on their innovations because of the cost. Those familiar with the patent reform issue expect the House to focus on aspects of the bill that increase the USPTO budget and scratch most of everything else in the Senate version.

Sources

CNNMoney.com

bNET

Washington Post

 

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