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Patent Reform Agreement Ends Fee Diversion, Preserves Oversight


Location: Washington, DC

The House Judiciary and Appropriations Committees have reached an agreement to end fee diversion and preserve oversight of the Patent and Trademark Office (PTO). The compromise creates a fund for fees collected by the PTO and reserves the money for the PTO.

House Speaker John Boehner, Majority Leader Eric Cantor, House Appropriations Chairman Hal Rogers, and House Judiciary Committee Chairman Lamar Smith applauded the agreement and urged passage of patent reform legislation.

Speaker Boehner: "The patent reform bill that the House will consider this week will help the private sector create American jobs. It will make it easier for our entrepreneurs, innovators, and manufacturers to keep our country on the leading edge of innovation. And it will cut down on frivolous lawsuits that make it harder for businesses to grow and hire."

Majority Leader Cantor: "The economy continues to sputter and millions of Americans remain out of work -- we need common sense policies to boost economic growth and get people back to work today. House Republicans have put forth the Plan for America's Job Creators and a key part of this plan is reforming our out-of-date patent system. Currently, there is a backlog of more than 700,000 patents, tying the hands of innovators and inventors looking to create new products, grow their businesses and create jobs. This bill will streamline and modernize the outdated patent process and allow PTO to keep 100% of the fees that it takes in from patent applications to ensure that they can focus on issuing better patents more efficiently. These changes will allow businesses small and large to attract capital for investment, create jobs and get people back to work."

Chairman Smith: "After six years of working towards patent reform, we are near the finish line. The new language negotiated by the Judiciary and Appropriations Committees ends fee diversion by creating a fund for fees collected by the PTO. The money in the fund will be reserved for and used by the PTO and only the PTO. This maintains congressional oversight, while making sure that fees collected by the PTO can no longer be diverted.

"Since 1992, nearly $1 billion has been diverted from the PTO. The average wait time for patent approval is three years. Allowing the PTO to retain the fees it collects means good patents are approved more quickly. That means more products for American consumers and more jobs for American workers. If Congress is serious about economic growth and job creation, we must support patent reform."

Chairman Rogers: "In this time of fiscal crisis, it is more important than ever that Congress keep a tight grip on the spending of each and every dollar within the federal government, making sure that funds are being used to the most benefit of the American people. The agreement today ensures that funding for the PTO will continue to be subject to the annual Appropriations process -- and therefore the under the watchful eye of the American public -- while allowing the agency to use collected funds to enhance service to the innovators and job creators of our country."

Much-needed reforms to our patent system are long overdue. The last major patent reform was nearly 60 years ago. H.R. 1249, the America Invents Act, implements a first-inventor-to-file standard for patent approval, creates a post-grant review system to weed out bad patents, and helps the Patent and Trademark Office (PTO) address the backlog of patent applications.

H.R. 1249 was approved by the House Judiciary Committee by a vote of 32-3. Similar legislation passed the Senate with overwhelming support by a vote of 95-5. The bill enjoys broad support from industry leaders, academic institutions and independent inventors. For more information about the America Invents Act please visit:

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