Patent reform in search of respect

October 3, 2011 – 9:46 AM | By Mark McCarty | No comments yet

We who scribble for a living find it easy to go off on those who do not, and today’s bulls-eye is on the patent reform bill recently signed into law, the America Invents Act of 2011.

One of the interesting things about H.R. 1249 is that it puts some of the fees collected by the U.S. Patent and Trademark Office in an escrow for Congress to decide whether to release to PTO. I’ve asked a number of people around Washington whether they think Congress can resist the temptation to write PTO an IOU and just keep the money, and almost no one has said yes. However, let us not forget that PTO’s fees just went up 15%. The foxes grow bolder and the hens just grow.

However, the criticisms of the bill to follow are not authored by yours truly. They are the views of Judge Paul Michel, who appeared last week at AdvaMed 2011, sponsored by the Advanced Medical Technology Association (Washington).

Just in case you haven’t followed these things, Judge Michel had a spot on the bench at the Court of Appeals for the Federal Circuit (CAFC) from 1988 ’til last year and served as the chief justice of the court starting in 2004. Michel has also appeared at congressional hearings on patent reform on a number of occasions, so his views have some heft in this town.

In addressing the change from first-to-invent to first-to-file (FTF), Michel said “a lot of whats in this bill is intended to be leveraged in future negotiations” regarding harmonization between national patent offices. He said the presumption is that going with FTF “will strengthen the hand of U.S. negotiators in the future” so as to give other nations some reason to adopt our grace period of 12 months after publication in academic literature. By many accounts, this grace period may vanish under H.R. 1249 unless Congress amends the statute to restore it.

Regarding such negotiations between PTO and other patent offices, Michel said, “the idea that they’re just going to roll over” is of dubious merit, adding, “I don’t think it’s going to happen.”

“Harmonization has an inherent problem,” Michel continued, noting that “the more you harmonize, the more you may be moving from an excellent system to a mediocre system,” which is of little help to the economy. “There’s a lot here that’s masked by” such considerations, he said.

Regarding the bill’s provisions for post-grant review, Michel said, “the Trojan horse is that it claims to create a high threshold” for review of a patent, but he said, “I think it’s going to turn out be not so nearly high as some people think.”

The post-grant review is a nine-month window that goes into effect in September 2012 and allows a patent to be challenged on nearly any grounds, at least by some accounts. “I think it’s going to turn out to be not so hard” to prod PTO into granting such a review, Michel said, remarking further that one outcome may be that “every commercially significant patent ” will be challenged under this new process, and those challenges could drag on.

“Its not really a one-year proceeding, it’s really closer to a three-year proceeding,” Michel said, which for highly iterative technologies may prove a death sentence for the market life of that patent.

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