112th Congress Becomes the Fourth To Attempt to Tackle Patent Reform

The 112th Congress, under the direction of Senator Patrick Leahy (D – Vt), is preparing to again consider a significant reformation of the U.S. patent system.  Numerous attempts have been made to reform the patent system since 2005, with most failing to reach a final vote.  Following up on these attempts, the Senate Judiciary Committee approved Senate Bill 23, which will, unsurprisingly, be known as the Patent Reform Act of 2011.

Many of the changes included in the prior bills have been maintained.  For instance, the Patent Reform Act of 2011 still seeks to shift the system to a first to file system.  Additionally, the bill would address damages controls, limit false marking claims to injured competitors, eliminate best mode challenges after issuance, prevent the issuance of patents claiming tax strategies, and implement three separate procedures for a third-party to challenge a patent.  These procedures would include the acceptance of relevant art and summaries from third parties during examination, a nine month post-grant review period (similar to a current reexamination, but open to all legal challenges), and an inter partes review proceeding limited only to novelty and obviousness challenges based on printed prior art (similar to current reexamination).

The bill also grants the U.S. Patent and Trademark Office the authority to establish its own fees.  In addition, the bill requires that the current 50% discounts to small entities be preserved and that a larger 75% discount be offered to a new class of applicants labeled as “micro-entities” (those independent inventors who have been named on five or fewer applications and have a gross income less than 2.5 times the national average).

Given that the issue of patent reform has been in limbo for six years, the Patent Reform Act of 2011 will likely be hotly debated.  We’ll keep you updated as changes are almost certain to be made before the bill would reach President Obama’s desk.  The bill is currently on its way to its first hurdle on the floor of the Senate.  However, keep in mind that previous bills have passed both the Senate or the House and failed to become law.