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The U.S. Senate Judiciary Committee took quick action on the Patent Reform Act of 2011 by adding two amendments and reporting it out of committee on a 15-0 vote on Feb. 3. The committee’s action clears the way for the bill to move to the Senate floor. Patent reform bills have been kicking around Congress for years, and the latest bill, S. 23, is the third time since 2008 that the Judiciary Committee has sent sweeping patent reform legislation to the full Senate. One of the new amendments in S. 23 struck language concerning willful infringement. The other amendment included several technical changes, plus a change to the language concerning residency requirements for judges on the U.S. Court of Appeals for the Federal Circuit. The Federal Circuit hears appeals of patent cases. The law currently requires Federal Circuit judges to live within 50 miles of the District of Columbia. The amendment eliminates that requirement, but also strikes language that would require the federal court system to provide workspace for judges who live more than 50 miles away. Patent reform watchers like the willful infringement amendment because they believe the 2007 Federal Circuit opinion in In Re Seagate Technologies solved that problem. Seagate made it much harder for a plaintiff to prove willful patent infringement, which allows for triple damages. But patent observers are eagerly awaiting an amendment to end diversion of U.S. Patent and Trademark Office fees to other government programs. At the Feb. 3 Judiciary Committee meeting, Sen. Tom Coburn (R-Okla.) said he planned to introduce the amendment to the full Senate. The committee’s swift action “counteracts some of the fatigue in terms of patent reform in the industry,” said Edward Reines, a partner in the Redwood Shores, Calif., office of New York’s Weil, Gotshal & Manges.”But predicting the rate and outcome of congressional action is a risky enterprise,” Reines said. The dropping of the willfulness provision reflects the fact that “over time, the Federal Circuit has taken care of many of the issues in play in patent reform,” Reines said. “Willfulness is one where the senators believe that may have been accomplished. Relaxing the residency requirement would be a valuable improvement, Reines said. “It would expand the pool of applicants to the Federal circuit…. It’s a great pool as it is, but this would generate an even a better pool of candidates.” Several intellectual property groups have thrown their support behind the new version of the bill. The American Intellectual Property Law Association , the Biotechnology Industry Organization and the Pharmaceutical Research and Manufacturers of America issued public statements of support this week. The Intellectual Property Owners Association also generally supports the current bill, said executive director, Herb Wamsley. The IPO favored the amendment striking the willful infringement provisions, he said. “The [Federal Circuit] has addressed issues with the law of willful infringement satisfactorily in its Seagate opinion,” Wamsley said. The IPO also “strongly supports” the Coburn amendment, which would fully fund the PTO with a fund for patent and trademark fee collections. “This will be one of the most important amendments when the bill comes to the floor of the Senate, and we are urging all senators to support it,” Wamsley said. The American Intellectual Property Law Association also supports the Coburn amendment, said executive director Q. Todd Dickinson. “We’re exited about the fact that this is a great compromise and moving so quickly,” Dickinson said. “We’d [also] like to see the Coburn amendment adopted on the floor to end fee diversion [from the PTO to other government programs].” “The compromise is a strong one,” added Dickinson. “It passed 15 to nothing. Its’ a very telling vote.” The American Innovators for Patent Reform, a coalition of inventors, companies and licensing executives, would support an amendment ending fee diversion, but little else in the reform bill is palatable, said founder and chairman Alexander Poltorak. “It’s a regurgitated version of the old deals that have failed,” Poltorak said. “This deal is characterized, actually mischaracterized, as a compromise bill. It’s a compromise between the big high-tech companies and the pharmaceutical community.” Like the prior reform bills, S. 23 includes changes to post-grant review of issued patents. There are already several ways to challenge the validity of a patent, through a couple of PTO procedures and the courts, Poltorak said. If there’s yet another way, “many independent inventors will simply abandon their patents because they won’t have the funds to defend their validity,” Poltorak said. The innovator group also strongly opposes changing the U.S. patent system to award patents to the first inventor to file. “It will create a race to the patent office and put small inventors at a disadvantage,” Poltorak said. “It is going to create very immature, raw patent applications because people are going to be in a rush to file them without due experimentation and working prototypes.” The Patent Reform Act of 2009, S.515, was reported out by the Senate Judiciary Committee in April 2009 and amended in March 2010. It languished in the Senate despite a September push by a bipartisan group of 25 senators. The senators wrote a letter to then Majority Leader Harry Reid (D-Nev.), asking him to bring the amended bill to the Senate floor for a vote. Sheri Qualters can be contacted at [email protected].

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