DOC/USPTO Write Senators Regarding Patent Reform Legislation

October 6, 2009. The Department of Commerce (DOC) sent a letter [PDF] on October 5, 2009 to Sen. Patrick Leahy (D-VT) and Sen. Jeff Sessions (R-AL), the Chairman and ranking Republican on the Senate Judiciary Committee (SJC), regarding patent reform legislation

David Kappos, head of the DOC's U.S. Patent and Trademark Office (USPTO), and Cameron Kerry, General Counsel of the DOC, spoke by telephone with reporters on October 6, 2009, about the letter and patent reform generally. The DOC letter bears the signature of Gary Locke, the Secretary of Commerce. He did not participate in the news conference.

Representatives and Senators introduced patent reform bills on March 3, 2009. Sen. Leahy and others introduced S 515 [LOC | WW], the "Patent Reform Act of 2009". See, story titled "Patent Reform Bills Introduced" in TLJ Daily E-Mail Alert No. 1,908, March 4, 2009.

The SJC amended and approved this bill on April 2, 2009, and reported it on May 12, 2009. See, Senate Report No. 111-18. (This report includes a copy of the bill as amended by the SJC.) However, the full Senate has taken no action.

The House bill, HR 1260 [LOC | WW], also titled the "Patent Reform Act of 2009", is sponsored by Rep. John Conyers (D-MI), Rep. Lamar Smith (R-TX), and others. The HJC held a hearing on patent reform on April 30, 2009. However, the HJC has not yet marked up its bill, or taken any other action.

The October 5 DOC letter states that "we are committed to working with Congress". Kerry, brother of Sen. John Kerry (D-MA), stated at the news conference that the preparation of this letter has been "a major preoccupation of my office".

Kerry (at left) stated that "nobody is going to get a perfect bill from their standpoint". But, he added, "there is a lot of momentum". See also, story titled "Obama Picks Cam Kerry for General Counsel at Department of Commerce" in TLJ Daily E-Mail Alert No. 1,915, March 19, 2009.

The DOC letter states that "landmark patent reform is urgently needed. We believe S. 515 incorporates the essential elements of patent reform; and, therefore, the Department of Commerce supports the bill with additional recommendations below."

The letter states generally that "the USPTO must have the resources, authority, and flexibility to administer the patent system effectively". It elaborates that "we endorse giving the USPTO the authority to adjust patent and trademark fees".

The letter also states that the USPTO should have "a limited fee adjustment authority". Kappos said at the news conference that the vehicle for this would be the patent reform bill, and not an add on to another bill. He added that this would be for one year, or two at the most.

The letter also states that the DOC supports "granting the USPTO substantive rulemaking authority". Kappos said that the USPTO needs this "to keep up with the pace of technology". Kappos declined to talk about the Tafas case, which pertains to rulemaking authority, and which is now pending before the U.S. Court of Appeals (FedCir).

The letter continues that S 515 "is a good starting point for developing post-grant review and inter partes reexamination procedures". The letter advocates "a phased-in post-grant review procedure, as well as phased-in changes to inter partes reexamination". It adds that since all this will cost money, the USPTO should have "flexibility to set or adjust fees to recover the cost of doing the applicable work".

The letter expresses support shifting from a first to invent to a first inventor to file system.

The letter expresses opposition to S 515's provision "relating to the search and examination duties for the grant of a U.S. patent".

The letter states that "we generally support the balanced compromise on damages which maintains the Federal courts' flexibility to determine reasonable royalty damages through a ``gatekeeper´´ approach reflected in recent court decisions as well as the purpose of the willful infringement and enhanced damages standard".

The letter states that the DOC wants "to work with the Congress to make various adjustments to implementing provisions regarding the scope and application of prior art and the grace period".

With respect to willful infringement, the letter states that "we generally support the relevant provisions of the bill", but that the DOC wants to work "to ensure a fair enhanced damages standard".

The letter also states that "we support extending the existing prior user defense for patent infringement; removing sanctions for failing to comply with the best mode requirement; limiting the applicability of revised approaches to interlocutory appeals and codifying recent judicial decisions improving the handling of venue challenges; and creating a pilot program that enhances judges' patent expertise." But, the DOC wants to work on "technical concerns".

Sen. Leahy responded in a release that "The administration's letter of support for the needed provisions in the Patent Reform Act reinforces the urgent need to enact this legislation. It has been more than 50 years since Congress passed meaningful reforms to our nation's patent system, and it is wrought with inefficiencies. I have been working with the bill's cosponsors, interested Senators, and the administration to reach consensus on this important legislation. I particularly appreciate the commitment of Secretary Locke and Under Secretary Kappos to this legislation. Now that the administration has indicated its support for the Patent Reform Act, I look forward to working with Majority Leader Reid to schedule Senate debate before the end of the year."