Thursday, May 17, 2007

Department of Commerce (i.e., USTPO) Weighs In on Patent Reform

John J. Sullivan, General Counsel of the United States Department of Commerce, issued a letter today to the H.R. Subcommittee on Courts, the Internet, and Intellectual Property Committee on the Judiciary regarding H.R. 1908. The legislation went through markup yesterday after a voice vote approving the legislation (see report here).

The DoC made numerous points in the 11-page letter:

Applicants are also responsible for patent quality:

"It cannot be emphasized enough that the grant of a patent right presumes an exchange of complete openness by the inventor for various rights of exclusivity. Thus, U.S. patent law requires inventors to disclose the "best mode" for reproducing their invention, and to explain their proposal in a manner clear to one skilled in a particular art. We believe that emphasis on full disclosure - as is required for fair exchanges in all fields of enterprise - will ensure a vibrant, modern patent system."
Current Inequitable Conduct Practice Perverts the Patent System:

"We recognize that, in many cases, applicants have expressed strong concerns about providing the USPTO with complete information about their applications. In some cases, applicants simply do not want to provide important information for fear that it will limit the scope of the patent they may receive (though such a limitation would be proper under the facts and the law). Unfortunately, an additional percentage of applicants do not make the effort to fully define their inventions because there is currently no procedural or other deterrent to submitting an ill-defined application.

In some other cases, applicants or their attorneys fear that the legal doctrines of inequitable conduct and unenforceability may unfairly punish them with Draconian penalties for innocently omitting information. The theory is that if one provides information, he or she must do so perfectly or potentially lose the patent or face disciplinary action; whereas, a failure to share any information carries no consequences."

* * *

"While the risk of an inequitable conduct finding is low, it is alleged relatively frequently and, when alleged, adds substantially to litigation costs and malpractice claims. The "all or nothing" result of an inequitable conduct finding understandably has a perverse effect on the actions of applicants and their attorneys with respect to "risking" a proper search in the first place. As a result, the doctrine drives counterproductive behavior before the USPTO. It discourages many applicants from conducting a search and leading others to be indiscriminate in the information they submit. In a review two years ago, we found that in over one-half of applications either no information disclosure statement was submitted or submissions included more than 20 references." (emphasis added)

The letter goes on to support 3rd-party prior art submissions, a "micro-entity" status before the USPTO that would greatly reduce fees, and a desire to expand the Accelerated Examination program.

Interestingly, the DoC was skeptical on apportioned damages, and was "unable to support" the willful infringement provisions in the Patent Reform Act. On post-grant review, the USPTO was also less-than-enthusiastic about the "second window" as well.

To read the entire letter, click here.

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