Patent reform moves in the right direction but there are still barriers for small inventors

Patent Reform - Image of Patent from 1927

President Barack Obama recently signed a patent reform bill as part of his job stimulus plan saying, "We have to do everything we can to encourage the entrepreneurial spirit wherever we find it," and that these reforms effectively “cut away the red tape that slows down our inventors and entrepreneurs." http://www.cnn.com/2011/POLITICS/09/16/obama.patent.reform/ 

From “First to Invent” to “First to File”
Prior to the signing of the patent reform bill, the United States was one of the only countries that provided patent ownership to those who were “first to invent.” Now, keeping in line with the rest of the world, American inventors must be “first to file” for a patent in order to obtain the rights. Lawmakers hope this will streamline the patent process and avoid the confusion that arises when many people claim an invention.

Changing from invent to first to file may be detrimental to the small time inventor who does not have the assets nor knowledge to obtain an attorney and file expediently.

Another issue is that this could create a breeding ground for “patent trolls:” companies that use patents as extortionary tools, making their money solely by suing entrepreneurs rather than commercializing the patents they own. One such patent troll is East Texas group Lodsys that has sued major companies such as Best Buy, Motorola, Hewlett Packard, Apple, and Google for interacting with customers online regarding products and services.

Under this new system, rather than inventing a product, trolls can attempt to usurp the efforts of inventors by filing before they do.

Fees
Another big change is that the United States Patent and Trademark Office will now retain all the fees paid to it by the filers. In the past, Congress collected the USPTO’s fees, and then allocated them a portion. This method has caused many critics to say that the USPTO is underfunded, so patent and trademark attorneys were incapable of performing their jobs thoroughly. The office has a 3 year wait to review a patent and is behind schedule by 700,000 patents. Furthermore, recent lawsuits have shown that many current patents are invalid and should not have been approved by the Patent Office at all. With improved funding of the USPTO, hopefully these issues will be remedied.

Post-Grant Review Process
The act also adds a post-grant review process of any patent issued. For up to nine months after the issue of a patent, inventors and companies may challenge the validity of the patent. This provides a more thorough review of the patent and clears up expensive future litigation.

Satellite Offices
Another innovation in patent reform is the creation of satellite offices around the country. Traditionally, the USPTO existed only in Alexandria, Virginia, right outside Washington, D.C. Recently, patent and trademark advocates pushed for the induction of multiple USPTO offices to be located in some of the entrepreneurial-heavy regions. The strategic locations of the offices aids inventors and companies who need the extra resources and help to file their patents. Mayor Gavin Newsom of San Francisco has particularly asked for the placement of such an office in California, home of Silicon Valley, one of the largest areas of technological innovation in the United States. Earlier this year, the first satellite office was opened in Detroit, Michigan, an area that was hit hard by the recession. The office created 100 new high-paying jobs for the city.

For more information on “patent trolling” and other reasons why reform of the patent system was necessary, check out these links:
http://www.uspto.gov/news/pr/2010/10_65.jsp
http://www.thisamericanlife.org/radio-archives/episode/441/transcript
http://www.appolicious.com/tech/articles/9283-lodsys-scrambling-to-keep-apple-out-of-patent-suit-with-ios-developers
http://www.wired.com/gadgetlab/2011/08/google-android-lodsys-patent/

For more information on the recent patent reform bill signed into law:
http://www.huffingtonpost.com/2011/09/16/patent-reform-obama_n_966136.html
http://www.allbusiness.com/finance/legal/16680947-1.html
http://www.ip-watch.org/weblog/2011/09/16/us-patent-reform-signed-into-law/

 

Photo Credit: by hospi-table

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