“[The] ‘U.S. patent system is clearly in distress’ and ‘has been subject to a series of shocks that have resulted in a system that …does not create the proper incentive structure to allow us to compete with China effectively.’” – Innovation Alliance letter
On January 11, Brian Pomper, Executive Director of the Innovation Alliance, sent a letter to President-elect Biden and Vice President-elect Harris urging support for strong patent rights and outlining Innovation Alliance’s recommendations with respect to the U.S. patent system and the U.S. Patent and Trademark Office (USPTO). The letter emphasized the importance of a strong patent system that incentivizes technological advancement in order to effectively compete with China and explained that the current system is in distress and strong leadership is needed.
Focus on Competition with China
The Innovation Alliance stressed that the Biden Administration should focus on what is needed to meet the challenges presented by foreign competitors, such as China. Calling China a “technological powerhouse,” the letter noted that China has made it “abundantly clear it intends to dominate the economy of the future by focusing on 5G, artificial intelligence, semiconductors, aerospace, biotechnology, and other critical emerging technological areas.” It further noted that the U.S. must have the right policies in place to encourage long-term private investment into such critical emerging technological areas in order to meet the challenge presented by China and other competitors.
U.S. Patent System in Distress
The letter also explained the Alliance’s view that the “U.S. patent system is clearly in distress” and “has been subject to a series of shocks that have resulted in a system that …does not create the proper incentive structure to allow us to compete with China effectively.” Pomper noted that the Supreme Court’s decision in eBay Inc. v. MercExchange, LLC has made it “very difficult for many patent holders to secure an injunction order blocking proven, ongoing patent infringement” and has opened the door to “predatory infringement,” i.e. a practice wherein large incumbent companies accused of infringement “continue to infringe while dragging out the litigation and challenging the patent using the post-grant challenge mechanisms created in the America Invents Act in 2011.” Due to the degradation of U.S. patent rights, many patent holders are now able to obtain better patent protection overseas than they are in the United States.
Pomper also discussed the Innovation Alliance’s view that “a series of Supreme Court decisions have confused the state of the law of patent eligibility under Section 101 of the Patent Act such that inventors have little predictability on what inventions are patentable, resulting in the invalidation of thousands of patents in the fields of information technology, software, and life sciences.” The letter cited a 2017 research paper titled “Turning Gold to Lead: How Patent Eligibility Doctrine is Undermining U.S. Leadership in Innovation” that discusses ”how Supreme Court decisions during the last decade have put the United States at a global disadvantage.”
Pomper concluded by encouraging the Biden Administration to support the STRONGER Patents Act, which was originally developed by Senator Chris Coons to “restore much needed balance to the U.S. patent system and predictability for American innovators and entrepreneurs,” and to choose a USPTO Director who understands the innovation ecosystem and “strives to make that ecosystem work to maximize technological advancement.”