Patent Reform Debate Heats Up - InformationWeek

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6/6/2007
07:09 PM
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Patent Reform Debate Heats Up

CompTIA calls for more funding for examiners and resources at the Patent Office, which many people agree is overwhelmed.

The Computing Technology Industry Association wants patent licensing fees to benefit the U.S. Patent and Trademark Office and instead of being a revenue generator for the general government spending.

CompTIA was one of several groups to weigh in on plans to overhaul the patent system during a Senate Judiciary Committee hearing Wednesday. Federal lawmakers in both parties and houses are considering patent reform legislation.

While most agree that the patent system needs improvement, there is plenty of disagreement about how to change the system and who will bear the burden of change. The Coalition for Patent Fairness -- with some of the best known names in IT, such as Apple and Microsoft -- is backing the Patent Reform Act of 2007. The act, introduced in the Senate, would allow damages to be based on the patent's contribution to the value of a complete product (not just one of many components). It would award triple damages for willful infringement and allow PTO experts to review patents they approved if someone disputes the approval.

CompTIA said it wants to end fee diversion and make sure fees help fund more examiners and resources at the PTO, which many people agree is overwhelmed. The group also wants to unify patent practices based on a global standard and ensure that patents are issued for high-quality applications. The industry association said it also wants to improve third-party participation, the quality of patents and protections for small businesses.

"A 2003 report from the Small Business Administration Office of Advocacy noted that small patenting firms produce 13-14 times more patents per employee than large patenting firms," CompTIA U.S. Public Policy Director Roger Cochetti said in prepared remarks. "The study also found that patents for small firms are more technically important on average than those for large firms."

Cochetti said that patent review improvements and a post-application approval proceeding for opposition should allow interested parties "to weed out bad patents before they can be used offensively to extract licensing revenues or subject firms to unmeritorious litigation expense."

"Without patent protection, a larger, better funded competitor has the ability to co-opt a smaller firm's technology," Cochetti said in prepared testimony. "Patents are in fact, the 'equalizer' for small firms vis-a-vis larger, better funded firms providing small firms leverage against their larger competitors and providing a mechanism to obtain valuable licensing revenues. For this reason we believe that enhanced education and outreach to small businesses about the value of patents in addition to technical assistance to small businesses and individual inventors would greatly help to reduce misperceptions about patents and the U.S. patent system."

Several biotech companies oppose the legislation. A representative of the Biotech Industry Organization said it would create uncertainty and weaken enforceability.

"Biotechnology innovation has the potential to provide cures and treatments for some of the world's most intractable diseases, such as cancer, Alzheimer's, Parkinson's, and HIV/AIDS, and to address some of the most pressing agricultural and environmental challenges facing our society today," BIO Alkermes Inc. SVP Kathryn Biberstein told the committee. "All of this innovation is possible because of the certainty and predictability provided by the U.S. patent system. Therefore, when considering changes to this system, we urge the Committee to consider carefully the cautionary language embraced by the Hippocratic Oath -- first, do no harm."

Biberstein said the bill, S.1145, contains commendable improvements, but the potential harm of several provisions outweighs the good. She opposes the changes to the way damages can be awarded, the post-grant opposition system and the PTO's rulemaking authority.

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