US Senate Passes Patent Reform Bill; President Expected to Sign


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Dec 30, 2010
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A new, and much needed, bi-partisan patent reform bill, called the America Invents Act, made it through U.S. Congress, and just passed the Senate. The bill passed in an 89 to 9 vote Thursday, and the President is expected to sign it into law soon. This bill is historic because it is the first real reform for the patent system in 50 years. In theory, the America Invents Act will attempt to eliminate the patent troll mentality and behavior within the system now.

The new bill completely overhauls the way patents are held now. Here is a list of the sweeping changes:
  • Gives the USPTO more control over its fees and directs the money to a capped patent office fund - Previously money from patents were given to Congress and ended up redirected elsewhere - According to estimates over $800 Million has been diverted from the agency over the last 21 years
  • Creates a new faster and improved application system for filing patents by recruiting more examiners, modernizing equipment and filtering out too broad patents - Currently the USPTO has a 3 year backlog of over 700,000 patents
  • Uses the "first-to-file approach" the way it is in Europe, instead of the current system's "first-to-invent" approach - this will eliminate years of wasteful legal arguments over who came up with the idea first - This was typically too costly for a small investor, thus giving larger corporations more monetary power - Now the new system helps to mitigate this disparity
  • Furthermore, this application can be disputed during the process or up to nine months after the filing - this change helps to police the system by allowing third parties to challenge a patent directly
The bill was publicly backed by a number of different major corporations, including Google, Apple, Microsoft and Intel. In fact, Intel, Apple and Microsoft have been petitioning the Federal government for several years for legislation reform like this.

The new law is not without some opposition. One example is Senator Tom Coburn, an Oklahoma Republican. He felt that the bill did not go far enough in addressing the way Congress has siphoned away millions from the USPTO for years. He commented that Patent fee diversion to the U.S. Treasury is "immoral, if not criminal," and argued that all patent fees should go directly to the USPTO, instead of the reserve fund set up by the House. Furthermore, an advocacy group that had opposed some earlier patent reform provisions, called The Innovation Alliance, indicated that the bill passed Thursday was an improvement over earlier versions. However, they were disappointed that the bill "does not end, once and for all, the diversion of patent office user fees."

Also, the National Small Business Association believes that the new bill favors big corporations by giving them extra leverage against smaller companies. Opponents also argue that the new legislation does nothing to address the software patent system. This may ultimately prove that the bill doesn't go far enough in dealing with these issues.

Still, ultimately, this is a big step in the right direction, and perhaps the new system will be viable for some tweaking in the near future. Here's a quote from the PCWorld article with a final statement on the matter,
Several tech groups, including the Business Software Alliance and Software and Information Industry Association (SIIA), applauded the bill's passage.

"The America Invents Act is an investment in innovation," Ken Wasch, SIIA president, said in a statement. "The legislation makes critical, necessary patent improvements that will drive our country's continued leadership in the software and information industries."
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Source: America Invents Act and PhoneArena and PCWorld


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Jul 12, 2010
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Lets hope the changes actually do good and not create loopholes that companies can use to cheat the system like they are now.