Senator Orrin Hatch (R-UT) has been out in front on patent and intellectual property issues for years, and he is at it once again. Senator Hatch has recently been very active with respect to writing op-ed articles explaining what all of us in the patent community have known for a very long time. My hope is that his profile will bring attention to what is obvious — “If we are to have a durable economic recovery, we must rely on our renowned American ingenuity to lead us into prosperity again.” These words were written by Senator Hatch in an op-ed published by TheHill.com earlier this week. I have been beating this drum for many months now, and with Senator Hatch beating the drum hopefully the rest of America, and in particular the Congress and White House, will pay attention.
Patents do not harm innovation, patents promote innovation. Patents are assets that can and do lead to exclusive rights that are attractive to investors because there is some reason to believe there is a competitive advantage. Investing is risky business, particularly in new technologies and start-up companies. If we are ever going to get out of this economic downturn we will need investors to provide capital for start-up technology companies, for further research and development in established companies and for the expansion and job creation we need to lower unemployment and get Americans working again and growing a strong and stable economy for the future. This is not rocket science really. We need to unleash market forces and American ingenuity, and that must start with patent reform and reform of the Patent Office.
I really recommend anyone interested in patents, innovation and the economy take the time to read Senator Hatch’s op-ed article. Rather than paraphrase, here are the first three paragraphs to wet your appetite:
America’s ingenuity continues to fund our economy, and we must protect new ideas and investments in innovation and creativity. Patents encourage technological advancement by providing incentives to invent, invest in and disclose new technology. Now, more than ever, it is important to ensure efficiency and increased quality in the issuance of patents. This in turn creates an environment that fosters entrepreneurship and the creation of jobs, two significant pillars in our economy.
The patent system is the bedrock of innovation. Last year alone, nearly 500,000 applications were filed at the U.S. Patent and Trademark Office, the world’s leading agency for intellectual property protection. The sheer volume of patent applications not only reflects the vibrant, innovative spirit that has made America a worldwide leader in science, engineering and technology, but also reflects countless new jobs waiting to be unleashed. When patents are developed commercially, they create jobs for the companies marketing products, and for their suppliers, distributors and retailers. One such patent has positive stimulatory effects across almost all sectors of our economy.
If there’s anything that I’ve become more certain of over these past several months, it’s this: If we are to have a durable economic recovery, we must rely on our renowned American ingenuity to lead us into prosperity again. Those of us in the IP community have long known the strong connection between a robust patent system and a healthy economy.
Senator Hatch has also been out in front of funding for the Patent Office, and also recently wrote an op-ed piece that appeared in the Mercury News explaining that Congressional pilfering of Patent Office funds amounts to nothing more than a tax on innovation, which is exactly the wrong thing to be doing or considering. In fact, the Patent Office needs more funding from Congress in order to get back on track. The backlog of pending patent applications is enormous, and the average time you have to wait to receive a patent is at an all time high. Recently the Patent Office has been taking steps to address these problems, but without additional funding there is only so much the Patent Office can do. I am not a fan of throwing money at a problem and assuming it will be fixed, but without more examiners there are many fields of technology that will continue to see waits approaching 8 or 9 years before a patent is issued.
Patent assets could be helping business grow right now, so waiting that length of time is really unacceptable, particularly when Congress can appropriate more money for the hiring of more examiners and examiner assistants right now! Even if Congress doubled the PTO budget, that would only cost $1.8 billion, which is nothing more than a rounding error compared to the trillions of dollars Presidents Bush and Obama have thrown at the economy, and not to mention the trillions thrown at the economy by the Fed. The irony is for a measly $1.8 billion in new money Congress could organically grow the economy by expedited creation of assets, which would bring investors off the sidelines and back into the game, which would grow the economy. My goodness this is not difficult to understand, is it?
Unfortunately, so much of this does seem difficult for so many to understand, and the folks in the Senate that really seem to understand patents seem to be getting marginalized. Senator Hatch seems to be one of the few who understand that inequitable conduct reform is the single most important patent reform issue, yet the Senate version of the bill doesn’t even mention inequitable conduct reform, and this is even after Senator Hatch was given assurances that it would. Senator Jon Kyl (R-AZ) also seems marginalized, and all he was trying to do was get the Judiciary Committee to consider the enormous burden post grant review would place on the Patent Office at a time when they are overwhelmed with patent applications that have been pending without any action for years. For more on Senators Hatch and Kyl not getting the Judiciary Committee to consider their sensible amendments see Senate Judiciary Committee Passes Patent Reform Bill.
What needs to happen is another moment like 1952. We absolutely need our leaders in Congress to stand together and acknowledge that with all of the changes in technology that have occurred over the last 57 years, and with the Federal Circuit and Supreme Court bickering year after year regarding basic patent law principles, it is time to re-codify this enormously important area of law and embark upon a path that would lead to another 50 years of sustainable patent law. I am afraid that nothing short of starting from scratch, and with an eye toward reforming and assisting the Patent Office, is acceptable at this point. But since this fair tale ending has about a snow ball’s chance in that very warm place, all those interested need to support the efforts of Senator Hatch and Senator Kyl and pray that others in Congress will come around.