Patent Reinvention Stymied

When the Omnibus Patent Act was introduced in May 1996, it had the support of business, the Clinton Administration and congressional Republicans. They all liked the idea of turning the nation's 200-year-old Patent and Trademark Office into a government corporation, much like the Post Office, and bringing U.S. patent law into line with the laws in other nations. The bill flew through the House last April after minor revisions, and later passed the Senate Judiciary Committee with only a single dissenter. Final passage this fall seemed like a sure thing.

But in what appears to be a David versus Goliath turnabout, independent inventors and small business have joined forces to oppose the bill because they fear it would make it easier for large, deep-pocket companies to steal their ideas. In addition, the patent examiners' union has raised concerns about the legislation's effects on its members. Now, with just a few weeks left before Congress adjourns, the prospects for patent reform this year seem dim.

The bill--sponsored by House Judiciary Courts and Intellectual Property Subcommittee chairman Howard Coble, R-N.C., and Senate Judiciary Committee chairman Orrin G. Hatch, R-Utah-- is a favorite of big businesses. They complain that foreign firms have a competitive edge because antiquated U.S. patent laws delay the publication of patent applications until after a patent has been granted.

Ford Motor Co., International Business Machines Corp. (IBM) and Intel Corp. are leading the 21st Century Patent Coalition, a group lobbying for the bill. Timothy B. Hackman, an IBM lobbyist with the coalition, said he's optimistic there's still time to pass the measure this year.

The Alliance for American Innovation has spearheaded the lobbying against the legislation on behalf of independent inventors and small businesses. The group got a huge boost last month when 26 Nobel laureates signed a letter denouncing the bill.

The independent inventors have three major concerns. First, the bill requires that patents be published 18 months after they're filed as they are in most other nations. Current U.S. law does not require the publication of patents until they're granted--which takes nearly four years, on average, from the time of filing. Under the bill, patent protection would continue for 17 years from the time of grant, but small businesses and inventors fear their ideas could be circumvented more easily with an earlier publication date.

Opponents also object to a provision originally in the bill that would allow third parties to challenge previously granted patents. And critics oppose a provision that would protect prior users of a patented idea who had failed to apply for a patent before one was granted to someone else.

In the House, a group of Members led by Rep. Dana Rohrabacher, R-Calif., forced changes to the bill to allow exceptions to the 18-month publication rule for small businesses, and striking the provision concerning challenges to previously granted patents. Hatch also altered his draft bill, exempting anyone from the 18-month publication rule who agreed, in advance, not to file for a patent abroad. At the time, Hatch received assurances from Senate GOP leaders that the measure would reach the floor this fall. But as many as 12 Senators are now said to have placed "holds" on the bill, blocking action.

Hatch contends he has addressed the independent inventors' concerns. He held a press conference earlier this month to announce endorsements by five of the six most recent patent commissioners. "This is a bill that American inventors need," Hatch said. "And this is a bill that should be passed this year."

The inventors aren't convinced. Beverly Selby, executive director of the Alliance for American Innovation, predicted that the proposed changes would allow big businesses to steal ideas from inventors who can't afford to fight challenges in court and can't protect their patents from being circumvented once the details are published. "If this bill goes through," she warned, "we'll have legalized industrial espionage."

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