Lawmakers introduce stripped-down patent bill

Two U.S. lawmakers have introduced patent legislation that would increase the budget for the U.S. Patent and Trademark Office (USPTO), even as a larger patent reform bill languishes in the U.S. Senate.

Representatives John Conyers Jr., a Michigan Democrat and chairman of the House Judiciary Committee, and Lamar Smith of Texas, the ranking Republican on the committee, introduced the Patent and Trademark Office Funding Stabilization Act on Tuesday. The bill seeks to address some major complaints about the USPTO, including a patent application backlog of more than two years.

The bill would allow the USPTO to impose a temporary 15 percent increase on its patent fees, and it would prohibit Congress from diverting patent fees away from the agency. Many tech companies and other critics have long complained about patent fee diversion.

In addition, the bill would allow the USPTO to hire new patent examiners and improve patent quality, Conyers and Smith said in a press release.

Members of the Senate Judiciary Committee have long tried to reach consensus on a more wide-ranging patent bill, which would allow new challenges to granted patents and would make it tougher for patent holders to prove willful infringement and collect huge damages. That bill, introduced in March 2009, is awaiting full Senate approval, but there remain several disagreements about the legislation. Similar bills introduced in 2005 and 2007 also went nowhere.

Senator Patrick Leahy, one of the chief sponsors of the Senate bill, released an amendment in March. On Tuesday, however, the Computer and Communications Industry Association (CCIA) said the new amendment would hurt U.S. innovation.

"Some once-productive companies feel that past investments in vast portfolios entitle them to thwart future innovators," CCIA President and CEO Ed Black wrote in a letter to senators. "The patent system as we knew it has been turned on its head, as has the push for reform that the IT sector first launched five years ago. When patents become too easy to get, trivial patents become an opportune vehicle for speculation and litigation against those who produce, distribute, or use complex products and services. This benefits lawyers rather than innovators."

Conyers said the new bill isn't intended to replace the Senate patent reform bill. "Ranking Member Smith and I remain optimistic and hopeful about the prospects for passage in this Congress of comprehensive patent reform," he said in a statement. "We expect to continue to work with our Senate colleagues on the larger bill."

There are more than 750,000 patents that haven't been examined at USPTO, the two lawmakers said. Under President Barack Obama's 2011 budget, more than US$200 million in patent fees would be sent to the government's general budget. USPTO is "in the midst of a crisis," Smith and Conyers said in their press release.

Every year, U.S. inventors file 500,000 new patent applications, Smith noted.

"New products and innovations drive the American economy and help create jobs," he said in a statement. "The quick and thorough processing of patent applications is critical to getting new products onto the market and into the hands of consumers. While Congress still needs to take up comprehensive patent reform, this bill is a good first step to updating our patent system, expediting review and improving patent quality."

Copyright © 2010 IDG Communications, Inc.

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