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Hearing of the Courts, The Internet, and Intellectual Property Subcommittee of the House Judiciary Committee: The Patent Act of 2005

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Location: Washington, DC


HEADLINE: HEARING OF THE COURTS, THE INTERNET, AND INTELLECTUAL PROPERTY SUBCOMMITTEE OF THE HOUSE JUDICIARY COMMITTEE

SUBJECT: THE PATENT ACT OF 2005

CHAIRED BY: REPRESENTATIVE LAMAR S. SMITH (R-TX)

WITNESSES: GARY L. GRISWOLD, PRESIDENT AND CHIEF INTELLECTUAL PROPERTY COUNSEL, 3M INNOVATIVE PROPERTIES COMPANY, ON BEHALF OF THE AMERICAN INTELLECTUAL PROPERTY LAW ASSOCIATION;

CARL GULBRANDSEN, MANAGING DIRECTOR, WISCONSIN ALUMNI RESEARCH FOUNDATION;

JOSH LERNER, PROFESSOR, HARVARD BUSINESS SCHOOL,

DAVID B. RAVICHER, EXECUTIVE DIRECTOR, PUBLIC PATENT FOUNDATION

BREAK IN TRANSCRIPT

Mr. GOODLATTE. Thank you, Mr. Chairman.

Mr. Gulbrandsen, according to Mr. Griswold's testimony, the average interference action costs an inventor over $300,000. Do universities and independent inventors have the resources to fight these interference actions?

Mr. GULBRANDSEN. Interference actions certainly are expensive. But I've been at WARF for 8 years. We file about two to three hundred patents a year. We have about 2,000 pending applications. And during my 8 years, we have only had one interference.

So the interference practice in the Patent Office is 1/10th of 1 percent of all U.S. patents filed. It is not a major problem with either the Patent Office or with universities, as far as I'm concerned.

Mr. GOODLATTE. Do you think that a change to a first-inventor-to-file system would help reduce even further these interference actions?

Mr. GULBRANDSEN. Well, certainly, if the present proposal becomes law, interference practice would go away. But interference practice, again, as far as our experience is concerned, has not been a particularly burdensome issue.

Mr. GOODLATTE. Thank you. This is a question for all of the witnesses. We'll start with you, Mr. Ravicher. Since it was not previously in the Committee Print, could each of you briefly comment on whether you believe that allowing third-party submissions of prior art with comments during the examination period is a good idea?

Mr. RAVICHER. It's a good idea, but I doubt it'll be very effective, because the problem is a credibility issue with the PTO; not that they're incapable to adequately review patents, but that they're created—they are given incentives which decrease their ability to perform a quality review. They're encouraged, both at the agency level and at the examiner level, to just issue patents, ''Get them out of the office as quickly as possible, get it off my desk as quickly as possible.''

So simply giving them more information may not do too much to actually help them, if you don't give them the time and enable the examiner to do the job that they are capable of doing.

Mr. GOODLATTE. Thank you. Professor Lerner?

Mr. LERNER. I think it is a good idea. The one thing that I would add as a caveat is that it's important that submissions not basically limit people's ability to bring up the same prior art if it gets litigated subsequently. In other words, people's willingness to participate in essentially submitting stuff pre-grant will probably be much reduced if it's the case that they are essentially going to be limited in terms of using that prior art if the patent examiner doesn't understand its importance. So I think it's important to make a provision in that regard.

Mr. GOODLATTE. Thank you. Mr. Gulbrandsen?

Mr. GULBRANDSEN. As a member of the Patent Public Advisory Council, I can tell you that the Patent Office strategic plan is directed in great part to increasing the quality of patents. We have a tremendous pendency of applications in the Patent Office. And if you exacerbate that pendency, that is going to damage the economy of this country more than the perceived help that additional third-party interaction during prosecution would help.

Mr. GOODLATTE. Thank you. Mr. Griswold?

Mr. GRISWOLD. Yes, we support the idea of third-party submissions. The key is having the Patent Office have the right information to make the decision. And as you heard me earlier talking about patent quality, we think it's a good feature.

Mr. GOODLATTE. Thank you. And Mr. Griswold, this question for you and Mr. Gulbrandsen. I understand that the current statute regarding injunctions was enacted over a hundred years ago. The statute calls on the courts to balance the equities when deciding whether to grant an injunction. However, I've heard reports that recent court decisions have resulted in almost automatic application of injunctions when infringement is found.

Do you believe that the changes in the last hundred years in business methodologies and in the nature of certain products today, that can involve hundreds or even thousands of patents, are the very kinds of reasons why the statute was written to allow for some flexibility? Didn't the statute build flexibility into the law that perhaps is not being used today? Start with you, Mr. Griswold.

Mr. GRISWOLD. I believe that the grant of an injunction as being almost automatic is appropriate, as you heard me answer earlier. I think it goes both ways. If we are found to be an infringer, we should be enjoined; and I feel the same way if we go after somebody else.

So I think the key is, as we bring in new technologies and different kinds of subject matter into the patent system, that those—the people practicing those subject matters act like others that do this every day. We understand what the prior art is; we do clearance opinions; we avoid patents of others; we do validity studies.

That's the way it works. I think that's a good system, and I think that eventually, as I mentioned, patent quality and people practicing in that system will solve the problems that we're concerned about here.

Mr. GOODLATTE. If I might, Mr. Chairman, let Mr. Gulbrandsen answer the same question.

Mr. SMITH. Okay.

Mr. GULBRANDSEN. I would agree with Mr. Griswold. I think that the ability to get an injunction if your patent is found valid and infringed is one of the hallmarks of our successful patent system.

Mr. GOODLATTE. Thank you, Mr. Chairman.

BREAK IN TRANSCRIPT

http://commdocs.house.gov/committees/judiciary/hju21655.000/hju21655_0f.htm

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