Innovation Alliance Opposes America Invents Act in the House

The Innovation Alliance is disappointed that the America Invents Act as introduced today in the House of Representatives does not include some important safeguards against the potential for abuse of the post-grant review procedures at the U.S. Patent and Trademark Office (USPTO). In particular, the bill includes a weak threshold for ‘second window’ inter partes review proceedings, one that will allow virtually all challenges to proceed to a trial-like hearing before an administrative patent judge. We believe a higher threshold is needed to enable the USPTO to manage the increased workload of the new administrative review system fairly and efficiently by screening out meritless or unsubstantiated petitions.

We are also deeply concerned that the bill introduces new standards that may preclude the enforceability of patents in court and at the International Trade Commission (ITC) pending completion of a post-grant administrative review at the USPTO, lengthens the time period defendants in infringement actions have to decide whether to pursue a post-grant administrative review, expands prior user rights to the detriment of early stage innovation and job growth, and unduly prejudices rights in an overly broad category of so-called ‘business method patents’ regardless of whether they survive a validity challenge.

The bill has some positive aspects. We were especially pleased to see, for instance, that the bill includes language that would end the diversion of USPTO fees and also includes some critical safeguards against abuse of the new post-grant administrative review system, including ‘could have raised’ estoppel and a presumption of validity for patents.

Nevertheless, the Innovation Alliance will oppose the America Invents Act in the House of Representatives in the absence of significant improvement in the areas of concern detailed above. As the debate over patent legislation proceeds, the Innovation Alliance will continue our longstanding efforts to ensure that any legislation strengthens rather than weakens the U.S. patent system and keeps America the most innovative economy in the world.