Tuesday, May 29, 2007

Exploring the big guy/little guy dimension in patent reform

Unlike a May 23 article in BusinessWeek, Cindy Kibbe of the New Hampshire Business Review got into the "big guy"/"little guy" issues in patent reform. This brings up a question for Congressmen considering various matters in patent reform: who are the "opinion makers" reflecting the needs of American business? Do BusinessWeek and the Wall Street Journal speak for small business?

Kibbe wrote:

But another coalition of mostly small and medium-sized tech companies, known as the Innovation Alliance, takes a much different view of the legislation.

In a letter sent to congressional leaders May 15, the companies said the “consequences” of the measure would be “devastating”, including “greater bureaucracy, inability to rely on valid patents, weakened protections against infringement and a decreased access to capital.”

“The harm to investment in tomorrow’s technologies would be felt immediately, and would hurt U.S. competitiveness for years to come,” they wrote.

Among the letter’s signatories was the Salem-based semiconductor manufacturer AmberWave Systems, the University of New Hampshire, Smoothshapes Inc., a Merrimack-based medical aesthetics company, and the Dartmouth Regional Technology Center in Lebanon.

AmberWave has been among the most active members of the Innovation Alliance and has taken its argument to Capitol Hill, voicing the concern that the proposed legislation has only the best interests of the biggest companies at heart, leaving smaller businesses and technology start-ups vulnerable to infringement.

“The proposed changes, especially those which have been driven by today’s largest technology companies, simply tilt the playing field in their favor and will hamper our nation’s technology companies of tomorrow,” said Bryan Lord, vice president and general counsel for AmberWave, in testimony before the House Subcommittee on Courts, Internet and Intellectual Property.

AmberWave is concerned that the measure “doesn’t address the root problem” of making stronger patents and has the “net impact of making patents easier to bust and easier to infringe,” Lord told New Hampshire Business Review.

He said his company is most concerned with the implementation of post-grant review. Such a provision, Lord said, would allow anyone — including the infringer — to request a review at any time during the life of a patent, making third parties far less likely to conduct due diligence prior to granting a patent.

“The post-grant review is a dramatic change,” said Lord. “It is casting a wide net to capture good patents in the past as well as good patents in the future.”

Lord suggested that reform focus on improving the pre-grant review process instead. “Otherwise, it’s like conducting a home inspection after purchasing the home,” he said.

LBE has been making similar points:

As W. Edwards Deming wrote: Cease dependence on inspection to achieve quality. Eliminate the need for inspection of a mass basis by building quality into the product in the first place. It is ironic to note that many of those who complain about a lack of patent quality ignore the precepts of quality when attempting to reform the patent system. If "bad patents" are a problem, then the solution is to correct the examination, not to inspect the "bad" products. [See also, Lawrence B. Ebert, On Patent Quality and Patent Reform, 88 JPTOS 1068 (2006) and Things Are Not Always What They Seem To Be, Intellectual Property Today, p. 20 (Oct. 2005)] . Joseph Hosteny has been writing against post-grant oppositions for years, emphasizing the rather basis point: If the PTO cannot do its first job right, how can we expect it to do yet another job? Adopting a post-grant opposition simply distracts us from the real problem: an inadequately funded and staffed PTO; no one has answered Mr. Hosteny on this point.

Unlike BusinessWeek, the New Hampshire Business Review got into the controversy surrounding the "second window" in post-grant review when it noted: a review at any time.

Additionally, anyone who thinks "patent reform" issues are a recent phenomenon should inspect 1 JPOS 1 (Sept. 1918), reprinted in 85 Supp J. Pat. & Trademark Off. Soc'y [JPTOS] 29 (2003). Yes, the National Academy of Sciences was involved in patent reform in 1918.


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