Wednesday, March 5, 2008

Issues on Patent Reform Litigation

One of the vital issues which remain unresolved today, pending action of the US Senate, is the controversial patent reform bill. Though an issue with very little publicity, the changes on the bill will expectedly affect how people think and treat intellectual property issues in the future.

Three key areas in the bill have been identified to be changed. They are:

  • Improvement on the quality of patents
  • Litigation reform
  • Adjustment of the US patent law in relation to the laws of its major trading partners

In the article, “Patent reform is again before Washington legislators, as Congress continued to fail to reach a consensus on the legislation in 2007, posted on February 19, 2008, some of the main issues in the reform include the following:

  • First to file versus Original Inventor (Not covered in the article)
  • Stopping patent trolls who profit on damages while contributing/advancing nothing
  • Litigation issues of small entrepreneurs
  • Limiting damage amounts (willful infringement)
  • Making the US code more similar to other countries

Last year, the House of Representatives passed the Patent Reform Act without trouble at all. Yet this time, many people see that the Senate will have a hard time putting all the necessary changes to it without getting the ire of patent holders, the infringers and the small entrepreneurs who support the inventors.

In the issue of litigation alone, the Senate will face a tough time explaining the legal issues behind the reforms they are proposing. Under the proposed law, known as the “Georgia-Pacific factors,” a set of 15 guidelines which most courts now use for determining damages in patent cases, would be reduced to a single concept of ‘apportionment’.

In this way, calculations of damages would be based on an economic analysis to ensure that “a royalty damage award captures only the economic value attributable to the patent’s specific contribution over previous inventions.”

But who is to determine any so-called ‘specific contribution’ of an invention to society? Who is to say an invention has no social contribution because it failed commercially and therefore, has no economic value?