Patent office reform effort hits hurdle

The Senate Judiciary Committee has eliminated a section of a House-passed bill that would permit the Patent and Trademark Office to reorganize itself as a more business-like operation, leaving chances of PTO's push to become a so-called performance-based organization in doubt.

The elimination of the performance-based organization provision-a political football between the Senate and the White House-along with some minor language changes, has proponents of the patent reform bill deely worried that the bill will be forced into a conference that could unravel months of intense work to reach compromise language.

"Almost any change would blow this bill sky-high," said Senate Judiciary Committee Chairman Orrin Hatch, R-Utah, acknowledging the risk in proceeding with a Senate version of the American Inventors Protection Action, S. 1798, introduced Wednesday by Hatch and Sen. Patrick Leahy, D-Vt.

Attempts to reform the patent system in the U.S. have been fought for years, pitting mostly large corporations-especially in high-tech fields-against independent inventors. The language of the House bill, H.R. 1907, sponsored by House Judiciary Committee Subcommittee on Courts and Intellectual Property Chairman Howard Coble, R-N.C., is a hard-scrabble compromise between the factions.

Although the Hatch-Leahy version does not change any of the contentious provisions of the Coble bill, some are concerned that passing a separate bill would lead to a dangerous conference committee that could strip compromises out or lead to the bill's graveyard.

"We all know that this will go behind closed doors, and I wouldn't trust them to do anything in the interest of independent inventors," said Inventor's Digest editor Joanne Hayes-Rines, who supported H.R. 1907 only after a series of compromises by Coble.

The Senate Judiciary Committee deferred action on both bills until next week.

"This has been a long and arduous journey," Hatch cautioned Judiciary Committee colleagues Sen. Charles Schumer, D-N.Y., and Sen. Dianne Feinstein, D-Calif., each of whom raised concerns that they said had been prompted by major companies in their states.

"We are still hopeful that legislation would pass this year," said Herb Wamsley, executive director of the Intellectual Property Owners Association. "I'm not aware of anything in Hatch-Leahy that inventors ought to be concerned about."

Because the bills are so close, he said that it easily could be sent back to the House and passed without a conference committee-something the White House hopes will happen as well.

"We had delicate negotiations on the House side and the Senate is now taking the compromise and opening that up," said a senior administration official. "That might mean that the bill doesn't pass."

The Patent and Trademark Office has been trying for four years to get legislation transforming it into a performance-based organization, a model that would free it from many federal personnel and procurement rules and allow PTO to better compensate its executives.

Several other agencies have been seeking legislation to become performance-based organizations. So far, Congress has only turned one agency, the Office of Student Financial Aid at the Education Department, into a performance-based organization.