US Patent reform one step closer?
8th July 2011
In April, we reported on the US Patent Reform bills that are currently making their way through the US judicial system. One bill, S. 23, was passed by an overwhelming majority in the Senate in March. A second bill, H.R.1249, was passed by the House Judiciary Committee.
These bills seek to bring major reform to the US patent system. The key changes include:
- Switching from the current “First-to-Invent” system to a “First-to-File” system. This would bring the US patent system into line with the rest of the world, making international applications more straightforward for US applicants.
- Changing the way the United States Patent and Trademark Office (USPTO) is funded in order to provide access to the necessary resources to hire new examiners and employ new technology, in an effort to reduce the current backlog of some 700,000 patents.
- Introducing a post-grant review system, and thereby reducing the need for costly litigation.
H.R. 1249 has now been voted on by the full US House of Representatives, passing with a vote of 304 to 117.
Prior to the vote, a number of amendments were introduced to the bill. The main change related to the proposed way in which the USPTO would be funded. Under the current system, any money raised through fees by the USPTO above their annual budget is diverted to general government revenue. Both S. 23 and H.R. 1249 sought to change this by allowing the USPTO to retain all money raised. However this proposed change was not popular in all quarters, and a compromise has now been reached. The amended bill states that all excess revenue will be diverted into a patent and trademark fee reserve fund. This money will be available for the exclusive the use of the USPTO, but approval will have to be obtained in order for the USPTO to gain access to the funds.
A number of other amendments were proposed but were ultimately unsuccessful. These included removing the provisions for changing from First-to-Invent to First to-File, removing the re-examination provisions for business method patents, and removing the provisions for expanding prior user rights to technologies other than business methods
The next step is for the two bills, S. 23 and H.R. 1249, to be reconciled into a single bill that can be signed into law.
President Obama has indicated his support for reform of the US patent system, and it is expected that he will sign this legislation if and when it is presented to him.
8 July 2011