Nothing fires up a legislative debate like an unexpected White House intervention, and if the Obama administration’s patent-policy announcements this month were aimed at generating headlines and Capitol Hill conversations, they succeeded. See White House Task Force on High Tech Patent Issues.
But if the intent was to steer the debate toward a balanced approach that would curb frivolous litigation without imperiling an intellectual-property protection system so key to nurturing innovation and job protection in this country, the effort appears to have failed.
Please don’t get me wrong. There are plenty of good reasons for the White House to get involved.
There are nearly half a dozen patent-related bills or proposals under consideration in the House and Senate, and the debate is sorely in need of facts and serious study. Much of the proposed legislation would make wholesale changes to the patent system, ignoring two centuries of clear evidence that strong patent protection promotes innovation, economic growth and a higher standard of living for Americans.
Yesterday the U.S. International Trade Commission (ITC) issued a final determination in one of the many ongoing proceedings between Apple and Samsung. These companies are battling each other in a variety of forums across the globe, which all together form the worldwide patent war over smartphones and tablets between the two tech giants. In this case the ITC found a violation of section 337 and issued a limited exclusion order prohibiting Apple from importing wireless communication devices, portable music and data processing devices, and tablet computers that infringe claims 75-76 and 82-84 of U.S. Patent No. 7,706,348. The ITC also issued a cease and desist order against Apple prohibiting the sale and distribution within the United States of articles that infringe claims 75-76 and 82-84 of the ’348 patent. No violation of U.S. Patent Nos. 7,486,644, 7,450,114, and 6,771,980 was found.
Which Apple products are implicated? The ITC determined that Samsung proved that AT&T models of the iPhone 4, iPhone 3GS, iPhone 3, iPad 3G, and iPad 2 3G infringe the asserted claims of the ’348 patent.
The ITC determination is now final, and the investigation is terminated. Apple has the opportunity to appeal the ITC final determination to the United States Court of Appeals for the Federal Circuit. But there is also another avenue for Apple, which could essentially nullify the ITC determination. Pursuant to 19 U.S.C. 1337(j), the President has 60 days to review the ITC determination. If the President disapproves of the ruling for policy reasons he has the authority to nullify the determination. The statute specifically explains that upon disapproval of the President an ITC determination “shall have no force or effect.”
Today the White House announced major steps to improve incentives for future innovation in high tech patents, a key driver of economic growth and good paying American jobs. The White House issued five executive actions and seven legislative recommendations designed to protect innovators from frivolous litigation and ensure the highest-quality patents in our system. Additionally, the National Economic Council and the Council of Economic Advisers released a report, Patent Assertion and U.S. Innovation, detailing the challenges posed and necessity for bold legislative action.
In 2011, the President signed the Leahy-Smith America Invents Act (AIA), a landmark piece of legislation designed to help make our patent system more efficient and reliable. As technology evolves more rapidly than ever, we must ensure our patent system keeps pace. As President Obama said in February, “our efforts at patent reform only went about halfway to where we need to go. What we need to do is pull together additional stakeholders and see if we can build some additional consensus on smarter patent laws.”
The AIA put in place new mechanisms for post-grant review of patents and other reforms to boost patent quality. Meanwhile, court decisions clarifying the scope of patentability and guidelines implementing these decisions diminish the opportunity to game the patent and litigation systems. Nevertheless, innovators continue to face challenges from Patent Assertion Entities (PAEs), companies that, in the President’s words “don’t actually produce anything themselves,” and instead develop a business model “to essentially leverage and hijack somebody else’s idea and see if they can extort some money out of them.” These entities are commonly known as “patent trolls.” Likewise, the so-called “Smartphone Patent Wars” have ballooned in recent years and today, several major companies spend more on patent litigation and defensive acquisition than on research and development.
The U.S. Patent Office as it looked prior to the Civil War.
The Old Patent Office is one of the most beautiful buildings in all of Washington, DC. Presently, it hosts the Smithsonian American Art Museum and the National Portrait Gallery. For those who are not from DC or familiar with the city, allow me to explain that obtaining directions to the Old Patent Office on your electronic device of choice may be difficult because there is no street address. At least I have never been able to find a street address for the building. The Old Patent Office Building takes up an entire city block in DC, located on the corner of Eighth and F Streets, roughly between the White House and Capitol.
Yes, the Patent Office was once upon a time thought to be so important to our new nation that this ornate building was located between the White House and the Capitol. Yet today there are forces throughout academia and elsewhere that would rather see the entire U.S. patent system dismantled. Oh how we have departed from the views of Madison, Jefferson and the other founders who thought a strong patent system would be central to the success of the new nation. That, however, is a story for another day.
The Old Patent Office Building has had a storied history, which is commensurate with what our early leaders, such as Presidents Jefferson, Madison and Lincoln thought of the patent system. In addition to housing the Patent Office from 1842 to 1932, in 1865 the Old Patent Office hosted President Lincoln’s second inaugural ball in the model room. This marked the first time that a government building was used for the inaugural ball. See Inaugural Ball, from the Joint Congressional Committee on Inaugural Ceremonies.
President Barack Obama (left), Governor Mitt Romney (right).
I am presently in San Francisco, California teaching the last live course for the PLI patent bar review course this year. As I was in my hotel room this morning getting ready for the day news coverage showed President Obama at a rally where supporters were screaming the familiar “4 more years” chant that you hear every time an incumbent President is running for reelection. The coverage then turned to Governor Romney in Wisconsin, where the crowd started chanting “4 more days.”
Then when I fired up my laptop to check e-mails and approve comments from first time posters and those otherwise caught up by our comment spam software, I came across a comment from a patent attorney who explained why he had finally decided to vote for President Obama — the Patent Office is working very well.
The comment to that article really didn’t fit with the broader content or theme of the article on which it was left. As frequent readers know I always try and encourage relevant comments that don’t go to far off tangent so as to keep the discussion focused and on point. So I didn’t approve that comment there but reached out to the commenter to let them know I would be posting this article.
Today’s Supreme Court ruling on Obamacare is historic. This issue has dominated political and private discourse for the past several years in America and, therefore, it is unrealistic to believe any legal commentator could resist the temptation to comment or opine. While Obamacare and the Supreme Court decision have nothing to do with intellectual property, I will, to the best of my abilities, turn this into a tongue in cheek patent commentary. Of course that is after I bash the Supreme Court. So liberals and others who believe the Supreme Court knows anything about anything should probably skip Part 1 and jump right to Part 2 of the article. I had a blast writing it. Hopefully you will have as much fun reading.
Part 1: Not Intended for Liberal / Supreme Court Consumption
A majority of the Supreme Court finally placed a meaningful limitation on the rampant, intellectually dishonest and terribly troubling use of the Commerce Clause to justify everything Congress ever wants to do. Unfortunately (at least in my opinion), Chief Justice John Roberts got in touch with his inner liberal and decided that the individual mandate is constitutional under the taxing power granted to Congress in the Constitution. Rather peculiar given that during the rancorous debates and ultimate passage of the bill the Obama Administration and Democrats in Congress repeatedly proclaimed this was not a tax on the American people. To be fair, the Obama Administration did seem to argue it both ways on the tax issue depending upon the forum. I guess arguing in the alternative paid off even if Congress and the President were dishonest with the American people in public.
President Obama delivers his State of the Union address, January 24, 2012.
In the annual State of the Union Address President Obama explained: “Innovation is what America has always been about.” Today the Obama Administration took major steps forward to collaboratively work with private industry to tap American ingenuity to assist in a world-wide humanitarian effort. The United States government will work with the private sector, universities, and non-profits to foster game-changing innovations with the potential to solve long-standing development challenges in health, food security and environmental sustainability.
I had the honor of being invited to the White House today for the Innovation for Global Development Event, which was held in support of the President’s commitment to using harness the power of innovation to solve long-standing global development challenges. As a part of this event, David Kappos, Under Secretary of Commerce for Intellectual Property and the Director of the United States Patent and Trademark Office, launched a pilot program dubbed Patents for Humanity, which is a voluntary prize competition for patent owners and licensees. The pilot program seeks to encourage businesses of all kinds to apply their patented technology to addressing the world’s humanitarian challenges.
Rebecca (left) watches President Obama sign the America Invents Act into law.
On September 17, 2011, I attended the Signing ofthe America Invents Act at Thomas Jefferson High School for Science and Technology. A young lady named Rebecca Hyndman, who is a senior at the high school, introduced President Obama, which took place immediately prior to his signing the Act into law. Rebecca was chosen for this honor because at the age of just 14 she acquired a patent for her own innovation. Recently, I ran into her father, Kelly Hyndman, at another IP event. While discussing the AIA signing ceremony, I asked Mr. Hyndman if he would mind my interviewing his daughter for our blog. With his blessing I conducted the following Interview via email, which I received back from Rebecca at the end of November. Unfortunately, as many of you know, I had to have emergency spinal fusion surgery and was unable to publish her interview prior to now.
So (as Gene likes to say) without further ado, here is my interview with Rebecca.
The Wall Street Journal is reporting that President Obama will today announce a proposal that would merge six agencies that focus on trade and commerce into one new department. Apparently the belief is that the restructuring will make it easier for businesses to navigate government bureaucracy. Notwithstanding, the proposed restructuring may better be thought of as a reshuffling since it seems that the plan would only save several billion dollars over 10 years. Thus, the real savings and streamlining may be minimal and likely won’t make the bureaucracy any more friendly unless regulations are minimized, but that is another topic for another day.
The Obama government restructuring plan is of particular importance within the patent community because it will affect the Commerce Department as well as five smaller agencies. As soon as I heard that my Spidey-senses started tingling. Wasn’t there something in the the Leahy-Smith America Invents Act (AIA) that applied only so long as the United States Patent and Trademark Office remained an agency within the Department of Commerce? Sure enough, there is. The new fee setting authority vested in the USPTO is contingent upon the Patent and Trademark Office remaining within the Department of Commerce.
At this time of the year many attorneys and agents are not paying all that much attention to the rules and requests for comments coming out of the Patent Office. Truthfully, with the number of changes that have taken place under the Kappos run Patent Office and the enormity of the America Invents Act many patent attorneys, including myself, are worn out! Add to that the typical end of the year matters for clients and our own businesses and it is easy to miss announcements in November and December.
With that in mind I thought I would take this opportunity to try and bring everyone up to speed on the various patent related announcements and notices in the Federal Register that were published in November 2011 and December 2011. I am told that more are on the way in January 2012. I can’t wait!
Several weeks ago, on December 11, 2011, U.S. Commerce Secretary John Bryson set out his vision for how the Department of Commerce can best partner with the business community to support President Obama’s jobs agenda. If the past is any indication of the future, President Obama and it senior team will do whatever they can leading into the new year to jump start the economy and get Americans back to work.
At his speech at the U.S. Chamber of Commerce, Commerce Secretary Bryson outlined his top three priorities to help American businesses “build it here and sell it everywhere,” focusing on supporting advanced manufacturing, increasing our exports, and attracting more investment to America from all over the world. The key to emerging from the Great Recession is, of course, manufacturing. Manufacturing jobs have left the U.S. in favor of more business friendly climates in other countries, taking with them U.S. jobs and U.S. intellectual property. But moving into a Presidential election year will government be able to do anything that is at all likely to help?
With an eye toward creating new jobs and improving the economy, the Obama Administration wants to expand the ability to quickly and efficiently transfer science and engineering breakthroughs from the laboratory to the commercial marketplace. To accomplish this goal, earlier today the Obama Administration announced two new initiatives to help U.S businesses create jobs and strengthen competitiveness in the global economy. The new initiatives continue a week long theme where President Obama has showed a willingness to take whatever executive action he feels he can in order to attempt to spur job creation.
This latest set of initiatives will take steps to speed up the transfer of federal research and development from the laboratory to the marketplace, and it will create BusinessUSA, a one-stop, central online platform where small businesses and businesses of all sizes that want to begin or increase exporting can access information about available federal programs without having to waste time navigating the federal bureaucracy.
Is this a good idea? Yes, I think so. Will this work in any relevant time frame to create new jobs? I doubt it. There is too much work that needs to be done, you cannot mandate the speed of innovation and many universities have a rather myopic view of their role within the technology transfer cycle to suggest that an effort like this will yield any results over the short-term. It is, however, something that should be undertaken.