Patent Reform Passes Senate; Bill Headed to House

WASHINGTON, March 8, 2011 – The Senate passed a bill Tuesday evening that would significantly reform the U.S. patent system for the first time in nearly 60 years.  The bill will now go to the House for consideration.

The Senate passed the America Invents Act – formerly the Patent Reform Act of 2011 – by an overwhelming majority of 95-5. Congress has failed to pass comprehensive patent reform in each of the last four Congresses.

One of the largest changes the bill would institute if it becomes law is switching the U.S. from a First-to-Invent system to a First-to-File system.  In the former, only the original inventor of a device or process may rightfully file for patent protection.  The First-to-File system, however, grants protection to the first inventor that brings a prosecutable claim to the US Patent and Trademark Office (USPTO).  The change would being the U.S. into harmony with the great majority of global patent systems, which rely on First-to-File.

“The America Invents Act will promote American innovation, create American jobs and grow America’s economy, all without adding to the deficit,” said Sen. Patrick Leahy (D-VT), the bill’s sponsor and Chair of the Senate Judiciary Committee. “It is a jobs bill that won’t spend a penny of taxpayer dollars.  It is commonsense legislation that will help preserve America’s position as the global leader in invention and innovation.”

Interestingly, Sen. Dianne Feinstein (D-CA), who supported First-to-Invent and sought unsuccessfully to amend the bill to retain the old standard, voted in favor of the Act.  Feinstein cited concerns that the measure, if enacted, would raise barriers for small businesses to remain competitive with large corporations by pitting them in a race to the steps of the USPTO.

“I think this is really a battle between the small inventors beginning in the garage, like those who developed the Apple computer that was nowhere, and who, through the first-to-invent system, were able to create one of the greatest companies in the world,” Feinstein said during debate over her proposed amendment on the Senate floor last week.

Other provisions of the bill would institute procedural changes intended to reign in damages, expand third-party challenges to patents through the USPTO and expedite the patent process, which currently can take as long as two to three years.

Though many industry associations have remained neutral or silent on the issue, the bill has garnered bipartisan support in Congress and at the White House.

“This long-overdue reform is vital to our ongoing efforts to modernize America’s patent laws and reduce the backlog of 700,000 patent applications – which won’t just increase transparency and certainty for inventors, entrepreneurs and businesses, but help grow our economy and create good jobs,” said President Barack Obama through a statement issued by the White House.

As the bill proceeds to the House for consideration, Rep. Lamar Smith (R-TX), Chair of the House Judiciary Committee, praised the Senate’s efforts and passage of the measure and anticipated similar legislation in the House within the month.

“Today’s vote in the Senate is a victory for American innovators who create businesses, generate jobs and drive economic growth,” said  Rep. Smith through a statement Tuesday evening. “The current patent system is outdated and is bogged down by frivolous suits and uncertainty regarding patent ownership.  Patent reform unleashes American inventors and allows patent holders to capitalize on their innovations and create new products and more jobs.”