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August 27, 2007

Engineering Failure

In a letter to Sen. Harry Reid, Senate Majority Leader:

IEEE-USA, which represents the interests of more than 215,000 engineers, scientists and allied professionals in the U.S., opposes the Patent Reform Act of 2007 (S. 1145). We believe that much of the legislation is a disincentive to inventiveness, and stifles new businesses and job growth by threatening the financial rewards available to innovators in U.S. industry. Passage of the current patent reform bill language would only serve to relax the very laws designed to protect American innovators and prevent infringement of their ideas.

Continuing with the letter:

IEEE-USA believes that, left as is, the patent reform legislation will create an environment that is harmful to individual inventors and small businesses. We are concerned that S. 1145 favors the companies with the financial resources that enable them to tread on others’ patent rights by commercializing works and inventions they did not create.

IEEE scoffs at the "microentity carve-out," and opposes: revision of § 102; post-grant review; apportionment of damages; letting USPTO management run amok with rule making, as it already has; third-party prior art submission; mandatory application publication; and first-to-file.

On post-grant review:

The proposed post-grant procedures could be used by large entities as a tactical litigation delay (of up to one-and-a-half years), giving larger businesses an unnecessary competitive advantage. Post-grant procedures may also cloud the validity of issued patents, thus reducing the value of patents held by start-up companies and universities (particularly, from the view of venture capitalists).

On third-party prior art submission, IEEE fears inequity:

[P]re-issue submissions could be used disproportionately by large corporations to block smaller entities attempting to protect innovations. Large corporations have the resources to research and follow the patent applications of start-up companies which are potential competitors. On the other hand, start-up companies have minimal resources to operate their endeavors, and likely do not have the time and resources to follow and submit prior art against the patent applications of large corporations. Accordingly, there will not be an equal level of scrutiny and prior art submission for all patent applications, creating a varying presumption of validity for patents.

IEEE is wrong about third-party prior art submission. Patents shouldn't be granted unless valid. That exceptions occur isn't a good excuse for making that regular practice, which is how we got here in the first place: lax examination during the 1990s. If a patent is granted over third-party prior art submission, its presumption of validity de facto is that much stronger. Let large corporations get their patents under less scrutiny. Any patent worth its salt ends up in court anyway, because nobody takes a first license without putting up some kind of fight, and, with the state of ease for declaratory judgment, the only safe way to enter licensing negotiations is for the patent holder to initially file a court complaint.

A similar letter was sent to Rep. Nancy Pelosi, House Majority Leader.

The big picture is that IEEE drives one more nail in the coffin of the the Patent Deform Act of 2007, and that's a good thing.

Posted by Patent Hawk at August 27, 2007 3:34 PM | The Patent System

Comments

Covered in the New York Times, but you got the full story first in the Patent Prospector:

http://bits.blogs.nytimes.com/2007/08/30/engineers-fight-patent-reform-not-patent-trolls/

Posted by: Patent Hawk at August 30, 2007 3:57 PM