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03.31.2011 Senate Passes Patent System Overhaul

“Patent or Perish,” such is the call by legislators for the United States to innovate its way out of high unemployment and meet head-on the concern that China is becoming the global leader in innovation – currently outpacing the U.S. "If we're going to win the global competition by out-innovating the rest of the world, we need a patent system that works in the 21st century," said Senate Judiciary Committee Chairman Patrick Leahy (D., Vt.), who authored the bill along with Orrin Hatch (R-UT), and Chuck Grassley (R-IA).

 

We are now one step closer to that goal according to proponents of the bill. Last week the Senate voted 95-5 to pass the patent reform bill which will, in fact, overhaul the U.S. patent system. If the patent reform bill does become law, the U.S. would shift to a “first to file” patent-rights system from a “first to invent” system. 
 

Currently most countries have already adopted the first-to-file system, but the United States uses the first-to-invent system. That leaves the door open door to legal challenges by inventors who have not rushed to the patent office with their ideas – a necessary first step on a road that is typically long and expensive, holding no guarantee that a patent will actually issue. Those who cannot afford to rush to the patent office can subsequently charge, or be charged with, infringement and then argue that they were “first to invent.”
 

The Patent Office would also gain power to set its own funding. This will likely result in higher application fees but may also mean faster processing of patent applications at a time when applications often wait years to be processed and longer still for patents to issue.
 

The next step according to a WSJ article (http://blogs.wsj.com/law/2011/03/09/patent-reform-bill-clears-senate-inches-toward-becoming-law/?blog_id=14&post_id=395454) is that “the House Judiciary Committee plans to introduce and vote on its own bill in the coming weeks, and the office of House Majority Leader Eric Cantor (R., Va.) said patent legislation is clearly on the agenda.”


For more information about this topic, please contact the author or any member of the Williams Mullen Economic Development Team.