Politico - The Importance of Patent Reform

Op-Ed

By Representative Lamar Smith & Senator Patrick Leahy

We have seen tremendous technological advancements in the past 60 years, as computers shrank from the size of a closet to wireless technology that fits in the palm of your hand. Yet all this time, patent laws protecting U.S. technology remained largely unchanged. We cannot protect the technology of today with the tools of the past.

This year, for the first time, China is expected to become the world's leading patent issuer, surpassing the U.S. and Japan in the number of patents granted. To keep pace in the global economy, we must do more to encourage America's innovators and job creators.

That's why a bipartisan and bicameral group in Congress has been working to update our patent system. After six years, we are near the finish line. The Senate passed its proposal by an overwhelming 95-5 vote. The House Judiciary Committee approved similar legislation 32-3. Now, the House is expected to vote on the bill.

The America Invents Act encourages innovation and promotes job creation. It switches the standard of patent approval from a "first to invent" to a "first inventor to file" system.

The United States is the only major developed country that still uses the costly and complex first-to-invent standard in awarding patents. This change is constitutional -- and common sense.

The Constitution expressly grants Congress the authority to "promote the progress of science and useful arts." The new act improves the patent system, ensuring better protection and promotion of intellectual property that can spur economic growth and generate jobs.

The provision returns us, in some respect, to a system that our founders created and used: first inventor to register. Former Attorney General Michael Mukasey recently described the proposal as "constitutional and wise."

Our current system is riddled with patent uncertainty, inviting years of costly litigation over ownership that independent inventors often lose. It costs anywhere from $400,000 to $500,000, according to the patent office, to pursue an interference proceeding -- claiming the right to a patent based on an earlier invention.

As The New York Times recently pointed out, "Most small inventors don't have that kind of money. Big corporations do."

The first-inventor-to-file system creates certainty about patent ownership and therefore reduces costly litigation. This right to ownership is crucial to raising capital, expanding businesses and creating jobs.

Our patent reform proposal also updates the "prior art" review process, which prevents the awarding of weak patents. Once an application is filed, a patent examiner investigates whether the product, or something similar, exists. It sounds simple, but the complexity of today's technology makes the review process time-consuming and often leads to the issuance of questionable patents.

By allowing third parties to submit information about patent applications, we can improve the accuracy of the review process. Industry experts or academics can submit information that may be common knowledge to them but unknown to the patent examiner and can explain its relevance to the application. That will ensure good patents are granted in a shorter period of time, while questionable patents are denied.

One big obstacle facing innovators today is the time it takes to get a patent approved: an average of three years. As of July 2010, 1.2 million patent applications were pending. Of those, more than 700,000 had not even reached an examiner's desk. This new act ensures adequate funding of the Patent and Trademark Office to help new products get to market faster.

Patent reform unleashes American innovation, allowing patent holders to capitalize on their inventions and create products and jobs. In addition to support from the administration, patent reform has broad support from industry leaders, academic institutions and independent inventors. And the U.S. Chamber of Commerce has said that "this legislation is crucial for American economic growth, jobs and the future of U.S. competitiveness."

Sixty years is a long time to wait for this crucial reform. Let's help American innovators stay on the cutting edge of new technology for the next 60 years. Let's make sure that our economy remains globally competitive.

Let's finally cross the finish line on patent reform.

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