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WASHINGTON � The U.S. Supreme Court’s recent patent decisions, and pending rules at the U.S. Patent and Trademark Office, may leave Congress last in line to board the ship of patent reform. It’s not that Congress lacks the will or interest to tackle long-sought improvements in the nation’s patent system, say scholars and litigators. In fact, key lawmakers in both chambers introduced major patent legislation in April and a hearing already has been held in the House. But, they explain, little progress has been made by the two largest stakeholders in the legislation � big pharmaceutical and big technology companies � to end the stalemate that has blocked patent reform in recent years. The pharmaceuticals want exclusive patent rights and no sweeping changes to the system, but the technology firms, bedeviled by what they see as too many bad patents, want major changes. “In a sense, I think the Supreme Court and the [Patent and Trademark Office] are leaving Congress in the dust,” said patent litigator J. Matthew Buchanan of the Oklahoma City intellectual property firm Dunlap, Codding & Rogers. Three fronts The recent House hearing on patent reform, he said, showed “zero” progress in bridging the chasm that separates big pharma and big tech. That means, he added, that the 110th Congress is starting at the beginning “again.” Allen Baum of the intellectual property firm Hutchinson Law Group in Raleigh, N.C., agreed, but he worries, he said, about the three different battlegrounds on which patent reform is being fought. “There has been a tremendous amount of pressure to change the system as a result of high-profile cases, like RIM and Vonage, as well as alleged abuses by patent-enforcement companies,” said Baum. “Three entities are trying to change things, but from different directions. “This whole thing is a delicate balancing act and if we don’t start thinking about the collective impact of these efforts, we’re going to look back in 20 years and wonder: Where are all the new drugs and the young companies trying to commercialize new technology?” The Supreme Court has reversed patent decisions by the U.S. Court of Appeals for the Federal Circuit five times in the past two years. The net result generally has been to make it easier to challenge patents. The justices’ appetite for patent cases may not be sated yet. Perhaps as early as May 14, the high court may decide whether to hear Amgen v. Hoescht, No. 06-1291, a challenge to the highly criticized Federal Circuit decision holding that the interpretation, or construction, of language in a patent claim is a question of law that is reviewed de novo � without regard to the district court’s reasoning. If the court takes Amgen, “it will be huge, huge and, I predict, another defeat for the Federal Circuit,” said Mark Davies of the D.C. office of O’Melveny & Myers. “People will spend a lot of time litigating in the district courts and get reversed in the Federal Circuit in a paragraph,” he said. “It’s a judicial administration type of question that the Supreme Court will feel very comfortable weighing in on.” The Supreme Court’s recent patent rulings do not always address key issues in the patent reform debate, say litigators and others, but last term’s ruling in eBay v. MercExchange did. Some lawmakers had voiced the hope that the justices would resolve the issue of whether injunctions were always the remedy for patent infringement. The high court said no. “In the last Congress, that was one of the most contentious issues and the Supreme Court took care of it,” said Harold Wegner of the Washington office of Foley & Lardner. And although not an issue in the current legislation, some lawmakers also hoped the court would clarify the standard for determining whether an invention was obvious and thus not patentable, he added � the key issue resolved in the court’s April 30 decision in KSR International v. Teleflex, No. 04-1350. The court also held April 30 that Microsoft did not violate the Patent Act by shipping a master version of Windows abroad to be copied and installed on foreign computers. Microsoft v. AT&T, No. 05-1056. The KSR decision may have a direct impact on the politics of the patent reform legislation, said Buchanan. “People pushing for reform the strongest, software in particular, always had as their rallying cry this bad patent problem,” he said. “On the flip side is the pharmaceutical industry and what they’re probably going to say is, ‘OK, you’ve always rallied around the bad-patent problem, but now that we’ve got KSR, which everyone thinks will address that problem because the bar for getting patents is elevated, we need to hold off on patent reform and see what KSR does.’ “If I had to guess, the pharmaceutical lobbyists are making those calls today,” Buchanan added. In the meantime, all parties to the reform debate also are waiting to see new rules being issued by the PTO, which would limit a patent applicant’s number of “bites at the apple” in seeking protection. The PTO contends so-called continuation filings force it to delay looking at new applications and contribute to the backlog of unexamined applications. “There’s a lot of talk about patent quality right now,” said Baum. “The Supreme Court is trying to address the quality issue by raising the bar for patentability in KSR. The patent office is trying to address it by requiring patent applicants to assist in the examination process by submitting large amounts of subject matter for consideration.” Congress, he added, is trying to address the issue by allowing the PTO to give interested third parties the opportunity to challenge recently issued patents � a significant tool for the PTO and third parties who think a patent should have been granted.

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