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Senate backs patent update

US could adopt first-to-file system

By Jim Abrams
Associated Press / March 9, 2011

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WASHINGTON — The nation’s patent system, which has forced innovators and inventors to wait years and outlast challenges and lawsuits before getting recognition for their products, would be overhauled under a measure passed yesterday by the Senate.

The legislation, approved 95-5, transforms a patent system now operating under a law passed in 1952, at a time when the high-tech revolution was still in the future and global competition was still negligible. It now moves to the House.

The White House gave the bill a strong endorsement, saying it was in line with President Obama’s goal of achieving job growth by encouraging innovation.

The most substantial change brought about by the bill would be to switch the United States to a “first-inventor-to-file’’ system for patent applications used by all other industrialized countries rather than the current “first-to-invent’’ system. Supporters say the first-to-file system would put American innovators on the same page as their overseas competitors, making the process simpler, more certain, and less expensive.

Utah Senator Orrin Hatch, a Republican and a leading sponsor, said it can cost $500,000 in legal fees if there is a dispute over who is the first to invent a product. Under the new system, he said, an inventor can pay $100 for a provisional application to protect his invention.

To meet the concerns of independent inventors and small businesses that first-to-file would give the edge to corporations with the resources to file quickly and often, the bill gives a one-year grace period to protect academics and other inventors who disclose their inventions before filing for a patent.

The bill also seeks to narrow the gap between the Patent and Trademark Office, which now takes about three years to process a patent, and the 21st-century high-tech world where products are continually being made obsolete by new breakthroughs.

It allows the patent office to determine fees and stops the practice of diverting patent fees to the general Treasury to ensure that the office has the resources to hire more qualified examiners and modernize its computer systems.

Currently the standard fee for filing an application is $1,090.

The patent office now has a backlog of 700,000 applications waiting initial action and 500,000 applications being processed.

The bill also tries to improve patent quality by allowing third parties the opportunity to submit information opposing pending patents and establishing an administrative review process for challenging the validity of a granted patent.

The legislation has garnered support from drug companies, large corporations, academic groups, and labor groups.