Patent Reform Seen As Hope For Inventors

Posted on August 3, 2011

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As a June 24 article in the Wall Street Journal pointed out, on June 23, 2011, the US House of Representatives passed the America Invents Act, a bill that would reform the current patent system in the United States for the first time since 1952. The bill is thought to have four main benefits:

  • Protections of intellectual property;
  • Reform of the current patent system;
  • Alleviation of the government backlog on patents: and
  • Greater competition with other industrialized nations.

The patent reform bill is seen as progressive for both the administrative sector and for inventors. On the administrative side, it would alleviate the current 1.2 million patent cases in the Patent and Trademark Office. As for American inventors, it would allow them the same leverage as their international competitors.

The most significant change marked by this bill is the change in how the U.S. grants patents.  Previously, the first inventor of a product had priority with his or her patent. Under the bill, the first applicant holds priority for his or her respective patent. The advantage as first applicant is even more crucial when the original inventor is not the top priority patent applicant. It creates a more competitive market, similar to those in Japan and other nations. In terms of the international scene, the United States would join the rest of the world’s patent systems and therefore maintain a competitive stance with other world industry leaders.

The most controversial provision would prevent Congress from diverting money from the fees the U.S. Patent and Trademark Office (USPTO) collects. According to the American Council on Education, the USPTO has a backlog of more than 700,000 applications, and this has allowed Congress to redirect millions of dollars in fees over the last 20 years. This provision will need to be reconciled with the Senate version (S. 23), which passed in March. Unfortunately, however, the next steps will have to be delayed until a compromise is reached on the issue of the debt ceiling.

While the bill would undoubtedly lead to a more efficient and more competitive invention market, it could prove a disservice to small businesses. Now that the patent system is set to turn into a competitive race, big corporations would be at an advantage because of their larger pool of legal resources. These corporations could potentially secure a patent before a small-name inventor, instead of protecting the inventor from potential investors claiming their original product as the current patent system allows.

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