Following quickly on the heels of the initial efforts by the House, the Senate Subcommittee on Intellectual Property conducted a hearing yesterday afternoon on the subject of patent reform.
In contrast to the House hearing, which focused on the Committee Print as a point of discussion, the Senate hearing was structured as a panel discussion of the reform issue generally. Nevertheless, the Senate hearing echoed several themes that emerged in the House hearing.
Specifically:
There is widespread support among users of the patent system for several major reform measures, including both administrative reforms and litigation reforms.
Substantial differences of opinion exist on a few of the proposed reform measures, including proposed changes to the injunctive relief provisions of the patent laws.
International harmonization of patent laws is one of the driving forces behind the current reform efforts.
There is a seemingly unanimous belief amongst users of the patent system that adequate and stable funding (using the words of Michael Kirk) for the Patent and Trademark Office is critical to the success of any reforms that are eventually enacted.
Politicians appear ready and willing to tackle the issue.
The witness list for the Senate hearing was divided into three panels. The first panel, consisting only of Director Dudas, provided the views of the Patent and Trademark Office. The second panel consisted of the two primary authors of the National Academies report and the third panel, designed to provide the views of inventors and patent owners, including representatives of businesses of various sizes.
Nearly all of the witnesses expressed support for two major administrative changes: adoption of a first-inventor-to-file system and implementation of an administrative post-grant review system. Levin and Myers, the authors of the National Academies report, each expressed an opinion that implementation of a post-grant review system should be the highest priority of all reforms (with international harmonization issues, presumably including adoption of a first-inventor-to-file system, running “a close second”).
William Parker, of Diffraction, Ltd. provided the lone voice of dissent against adoption of a first-inventor-to-file system, claiming that such a system would pose problems for small inventors (individuals or small business inventors).
While the concept of post-grant review was generally favored by the panel, differences remain on the details of the administrative system. Director Dudas expressed the position of the Patent Office that a window of 12 months after issuance is needed, as compared to the 9 month window in current proposals. David Simon, appearing on behalf of the Business Software Alliance, spoke of a need for a “second window” for opposition that could be opened at any time in the patent term when certain conditions are met. Robert Armitage of Eli Lilly disagreed, stating that foreign opposition systems, which frequently produce oppositions that last several years, are no model for our reform effort and that a single, 9 month window for instituting an opposition is sufficient.
The hearing confirmed the status of injunctive relief reform as the most controversial measure currently on the table. Several of the witnesses that support reform in this area criticize the current system as producing automatic injunctions with patents found valid and infringed, claiming that courts ignore the statutory language regarding consideration of the equities in a particular situation. On the other side, many believe the current system to be adequate and appropriate.
The supporters of reform in this area concede that they do not want to eliminate the injunction as a remedy, but rather want only to ensure that the equities be considered, as the statute requires, when courts consider awarding this type of relief. They even note that a primary reason behind this position is the “patent troll” problem, believing that a court would be unlikely to issue an injunction based on equitable considerations when a patent owner who doesn’t practice the claimed invention (or who exhibits other troll-like traits) proves infringement. Look for the trolls to be singled out in future debates on this issue.
