Overhaul of the US patent system passed by Senate
In an 89-9 vote on 9/8/11, the Senate cleared a bill passed by the House in June that would fundamentally alter the way patents are reviewed and mark the biggest change to patent law since at least 1952.
- The legislation, H.R. 1249, would let the US Patent and Trademark Office (PTO) set its own fees and exercise greater control over its budget, providing the agency with more funding to address a backlog of almost 700K applications awaiting first review.
The funding provision, which also would let the agency increase fees paid by inventors and patent owners, is the cornerstone of the bill and has been a unifying issue even for those who oppose other provisions. Since 1990, the agency says, more than $800M in fees has been diverted by lawmakers to non-patent purposes. The patent office is funded entirely by user fees. The Obama administration says the money is needed to hire more examiners and improve agency computer systems to cut the current 34 month wait for patent approval.
The Bottom Line: Under the bill, patents would be granted to the 1st inventor to file an application, ending an often time-consuming procedure to determine who came up with an idea first and bringing the US in line with patent laws in other countries. All newly issued patents may be subject to a challenge from 3rd parties, a variation of a process used by the European Patent Office. 3rd parties would be allowed to submit information for consideration during the application process. The bill also would limit patents on tax-avoidance strategies. Reducing the time it takes to give inventions legal protection will speed new products to the market and spur economic growth. The legislation, which culminates more than 6 years of negotiations and lobbying, covers every step of the patent process, setting new procedures to review issued patents while curtailing some litigation. The measure, called the America Invents Act, now heads to the White House for Obama’s signature.