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WASHINGTON � Due to an increase in patent litigation and jury awards reaching into the millions, a new coalition is urging federal lawmakers to support legislation that would change the way the courts handle patent suits. The Coalition for Patent Fairness, a patchwork of 45 companies from the technology, financial services and manufacturing industries � led by lobbyist Mark Isakowitz of Fierce Isakowitz & Blalock � has spent the better half of 2006 building momentum and educating members of Congress about concerns the group has about the current patent system. Isakowitz says in the coming year he expects the Senate to act on patent reform legislation introduced by Senate Judiciary Committee members Orrin Hatch, R-Utah, and Patrick Leahy, D-Vt. The Patent Reform Act of 2006 would, among many things, award patents based on a “first-to-file” method versus the existing “first-to-invent method.” Additionally, the bill would establish new standards for awarding damages. Judges would consider the relevant value of the infringed item and any history of nonexclusive marketplace licensing. Citing the coalition’s muscle in lobbying Congress, Isakowitz notes a letter he and the coalition sent to Hatch and Leahy on July 26 asking Congress for “fair and balanced reforms.” The legislation was introduced Aug. 4, the day Congress adjourned for its summer recess. “The most telling thing . . . that letter we sent a week or so before the Hatch bill was introduced . . . that was the result of a lot of our effort,” says Isakowitz. Yet Tracy Schmaler, press secretary for the Judiciary Committee’s minority staff, says the bill was a culmination of two years of hearings and debate on patent reform. With Congress set to adjourn Sept. 29, Schmaler was uncertain when the legislation would be marked up. The coalition, which started lobbying in late July, includes Apple Computer Inc., the Business Software Alliance, Comcast Corp., Dell Inc., the Financial Services Roundtable, Hewlett-Packard Co., Intel Corp., Microsoft Corp., Oracle Corp., TechNet, and Time Warner Inc. In addition to Isakowitz, Mayer Brown Rowe & Maw partner Andrew Pincus says he’s focusing on the substantive arguments for patent reform. According to a 2006 study by PricewaterhouseCoopers International Ltd., the number of patent infringement cases filed annually increased from 1,171 in 1991 to 3,075 in 2004. Since 1994, the report states, the median amount of damages awarded by juries has been $8 million. Isakowitz, the former director of federal governmental relations for the National Federation of Independent Business, says a handful of cases, including eBay Inc. v. MercExchange, have raised the issue’s profile. But it was the recently settled patent suit by the Canada-based maker of the BlackBerry e-mail device that has resonated the most with Hill lawmakers. Before the case was settled in March, many of the 3 million BlackBerry users feared the suit would shut down their beloved e-mail-on-the-go toy.

Read our latest coverage of patent law and intellectual property issues, from Silicon Valley to the U.S. Supreme Court.

At issue was whether Research in Motion Ltd., the maker of the BlackBerry, infringed on the intellectual property rights of the small, Virginia-based NTP Inc., whose founder created a system to send e-mails between computers and wireless devices. RIM agreed to pay NTP $612.5 million to settle the dispute. For members of Congress and their staff, BlackBerrys have become the single most identifiable work tool, says Isakowitz, and the shutdown threat was a winning argument with pols, who couldn’t imagine life in Washington without the electronic device. “It’s essential to the culture in that building, and this is the very issue that almost took their BlackBerry away,” he says. Coalition members say they want to change the way a venue is chosen for patent challenges, set standards for how juries determine damage awards, and ensure companies are not held liable in U.S. courts for worldwide damages. Those who oppose the legislation, such as members of the pharmaceutical industry, assert that proponents are trying to make it harder to get, and easier to invalidate, a patent. Hunton & Williams partner Patrick Doody, who focuses on intellectual property and patent infringement litigation, says the coalition represents one basic industry sector, computers. He says the proposed changes would serve computer companies well but harm others, notably pharmaceutical companies, which often have only a handful of patents for their prized drugs versus the several hundred that computer companies often possess. Says Doody, “Microsoft will come out with Office 2009 and will sell millions of copies of it whether or not patents are protected.” Joe Crea is a reporter with Legal Times, a Recorder affiliate based in Washington, D.C.

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