Patent Reform: Congress Choosing Sides

The partisan nature of politics often falls apart on patent reform issues. For instance, IP subcommittee leaders Lamar Smith (R) and Howard Berman (D) both support patent reform efforts — although it is unclear if either support all the provisions in the proposed draft legislation.  Now, the New Democrat Coalition (NDC), a group 43 of “pro-growth” Democratic Representatives, has sent an open letter to Smith and Berman supporting the legislative initiative.  The NDC is specifically supporting some of the most controversial aspects of the legislation — including limits to injunctions and damages.

[W]e urge you to include the following among the many important patent reform items in your legislation:

1) Third Party Submission of Prior Art. . .

2) Injunctions: We believe injunctive relief is an important legal reform element of patent reform and we encourage the Committee to take aim at those who seek to abuse the patent system for profit.

3) Treble Damages: . . . this legal standard should be revised. While courts should be able to assess higher damage amounts when a defendant’s actions warrant, treble damages should be limited to those cases where intentional or egregious conduct warrants a punitive measure of damages.

4) Apportionment of Damages: . . . Today, complex products such as semiconductors or software programs include thousands of features, many of which are patented.  As these products have become more complex, the old methods for determining the value of infringement have become strained and have led to some unfair results.

From the side of special interests, I see three major coalitions forming:

1) Large high-tech companies, including Microsoft and Intel, with the goal of reducing the strength of patents. These companies have major patent portfolios, but fear small companies and individuals that may develop blocking patents.  This group is also garnering support from denouncers of software patents.

2) Other large patent holders, including Big Pharma, with the goal of strengthening and streamlining patents by changing to a first-to-file system and encouraging a post-grant opposition.

3) Start-ups and individual inventors, with the goal of keeping the status quo.

The question is: where does your company fit into the picture?

Links:

• Read Matt Buchanan’s take;
• File Attachment: PatentReformNDCLetter.pdf (274 KB) (provided by Buchanan);
• Lawyers Weekly USA article on patent reform (quoting both me and Buchanan).