On June 3, InventVermont hosted a panel on Intellectual Property that featured Senator Patrick Leahy and the Director of the United States Patent and Trademark Office, David Kappos.  The event was held at the Main St. Landing Building in downtown Burlington, VT and was sponsored by local law firm Merritt, Merritt & Moulton. Sen. Leahy is currently the chairman of the Senate Judiciary Committee, and earlier this year announced that he is working on a bill to address patent reform for the first time since 1952.

The bill recognizes that the USPTO is currently facing a backlog of 700,000 patent applications which the agency would like to reduce by 50%, and ultimately offer first office action to patent filers within 10 months. During his speech, Senator Leahy bluntly offered that the USPTO is underfunded and currently has an “unacceptable backlog”. Leahy suggested that current Director Kappos inherited a lot of difficult issues to deal with when he joined in 2009, and has been making progress, but needs help from this new bill to be able to move forward more rapidly.  The new legislation has a few key goals:

1)     Harmonize US patent law with international patent law, so that “first to file” is the standard here in the States, instead of the current “first to invent” status.  Senator Leahy believes this will ultimately increase American competitiveness overseas.

2)      Provides fee setting authority to the USPTO.  This includes mandating lower fees for smaller inventors, and would also offer a “fast track” service for a premium price, or alternatively a “slow track” option for filers who weren’t yet ready to commercialize their inventions.

3)      Increase the quality of patents awarded by allowing 3^rd parties to comment on the patent as it is being reviewed

4)      Improve the challenges process for existing patents

There was some concern from those in attendance that the bill is “big company” friendly, and doesn’t provide enough protection for smaller inventors.  Ken Puzey of Quantaspec believes the “bar will be raised too high for a patent owner to prove willful infringement”.  The proposed reforms will also reduce infringement damages, so Ken’s concern is that many large companies may just decide to infringe first, then if they get sued, later decide to license a patent if needed.

Senator Leahy’s rebuttal was that this bill will reduce filing backlog, reduce filing fees, and improve the administrative process for review, which will all be good for small businesses.  In addition, he noted that the National Venture Capital Association (NVCA) supported this bill, which in his estimation is a thumbs up from the small business community.

There was also a question from Stuart Meyer of Fenwick & West about the proposed Patent Reform and how an impending Supreme Court decision regarding Business Method Patents will affect the proposed legislation.  It was clear that all eyes were on the Supreme Court awaiting this decision, and while the ultimate outcome was still unclear, whatever rule that came down from the Supreme Court, it would then fall on the USPTO to determine how to interpret and implement that ruling. 

For his part, Senator Leahy believes that “Intellectual Property is the centerpiece of our country’s job creation”, and that this new bill will offer a step forward towards securing the U.S.’ status in promoting innovation and therefore strengthening our economy.