On Friday, September 16, 2011, President Obama signed into law “The America Invents Act” (“AIA”) which passed the Senate on September 8, 2011, by a vote of 89-9. The AIA passed the House of Representatives on June 23rd by a vote of 304-117. The measure, which is the product of a seven-years-long legislative battle among patent policy stakeholders, changes how patents are obtained and enforced in the United States. Important reforms to patent law are incorporated into the AIA and, just as significantly, several controversial proposed changes were deleted from the AIA before final passage. This article is a play-by-play of the process and how it unfolded.

The economics of mass patent enforcement have changed. A patent owner will no longer be able to casually sue a multitude of parties with a single filing, participate in proceedings in a single action in a single venue likely convenient only for the plaintiff, and thereby expeditiously pursue a recovery against numerous disparate parties. Actions will have to be filed individually against each accused infringer. The patent owner will have to participate in, contend with and address procedural and substantive aspects of each action.

President Obama started by commending the students of what he called “One of the best high schools in the country.” He mentioned that; “We have an exhibit of some of the projects that you guys are doing, including the fist high school student satellite, a wheel chair controlled by brain waves, robotics and more. He made the crowd smile when he jokingly said; “I am hoping that I will learn something just by being close to you; through osmosis. I already feel smart just standing here.”

On September 16, 2011, President Obama signed the Leahy-Smith America Invents Act and, with his signature, which will marshal in major changes to the U.S. patent system. Many provisions of the Act take effect a year or more after this date including, e.g., procedures for post-grant review proceedings before the U.S. Patent and Trademark Office (after September 16, 2012) and a change to a first inventor to file system (after March 16, 2013). However, a number of changes will take effect on September 16, 2011, or soon thereafter. The immediate and nearly immediate changes are outlined here in this article.

Those rushing to pay fees before September 26, 2011, will save 15%, but the Patent Office will not have access to that money. The budgetary calendar resets on October 1, 2011, which marks the start of Fiscal Year 2012. While the America Invents Act does not put an end to fee diversion key Congressmen in the House of Representatives pledged that they would allow the USPTO to keep 100% of the user fees collected. Thus, presumably, fees paid starting October 1, 2011, would go to the USPTO to use for the purpose intended by the payor; namely the examination of applications and ongoing business operations of the agency.

Some will undoubtedly view the Chief Judge’s basis in Ultramercial for distinguishing the ruling in CyberSource as being “slight of hand” and using “mirrors,” but it certainly illustrates the wide gulf of views between the various members on the Federal Circuit on the patent-eligibility question. I wouldn’t be surprised (and frankly it needs to happen) if both Ultramercial and CyberSource ended up before the en banc Federal Circuit. As I’ve noted previously, we’ve currently got what appear to be irreconcilable decisions in the Classen, Prometheus, and AMP cases in determining the patent-eligibility of certain medical (e.g., diagnostic) methods. With what appears to be similarly conflicting decisions in Ultramercial and CyberSource, the gauntlet has truly been thrown down. An en banc Federal Circuit needs to step in soon, or the conflagration that currently exists in the patent-eligibility “war” might soon consume us all.

The truth is that Google bought a great deal more than patents when it acquired Motorola, though there are doubtless some real gems in the Motorola portfolio. As a relative newcomer to the wireless arena, the search giant in one bold move got its hands on the unmatched innovation experience of the longest-lived mobile phone company on earth. The technical acumen and product experience of those thousands of mobile software and hardware engineers will prove hugely valuable to Google as it seeks to dominate the $250 billion global market in smartphones, especially if it decides to become a handset maker as Motorola had been.

For example, regarding Thomas Edison, Lemley’s primary case illustrating the so-called “myth of the sole inventor,” he alleges that “Sawyer and Man invented and patented the incandescent light bulb” (Lemley 2011, p26) and that “Edison did not invent the light bulb in any meaningful sense” (Lemley 2011, p25). We disprove Lemley’s assertions and present five key facts that Lemley omits: for example, although Lemley cites a Supreme Court case in 1895 as a source for the statement above, he neglects to inform us of the decision reported in that case; it affirmed a lower court’s 1889 decision in favor of Edison and finding the Sawyer & Man patent invalid. Furthermore, the Sawyer and Man lamps were not commercially viable, having only a few hours life, whereas Edison’s invention was the basis for a lamp with a hundred times longer useful lifetime: electric lighting became economic and it was Edison’s invention that unlocked the field after three decades of experimentation by others in incandescent lamps. There was no candidate for an invention simultaneous with Edison’s invention.

I’m not suggesting that those who write the patent bar examination questions are testing irrelevant stuff, but what types of questions would you ask if you were writing an exam question that tried to determine whether someone who wanted to be admitted to the club understood the rules well enough to become a member? You would likely ask questions about organization rules and procedures that fell into one of several categories: (1) those that are commonly misunderstood or unknown by current members; (2) those that are of extraordinary importance due to the magnitude of harm that could accompany a misunderstanding or mistake; or (3) those things that are particularly weird. So it isn’t at all surprising that counter-intuitive rules that are commonly misunderstood or misapplied make up a statistically relevant portion of the exam.

The search for innovative ideas has never been easy, but the advent of crowdsourcing technologies and powerful players willing to embrace new methodologies seems to be paying dividends. Rather than rely on traditional innovation that comes from one individual or a small group of individuals or those working for or with a single entity or as part of a joint venture, crowdsourcing technologies take problems to millions of people and capture the most creative solutions, allowing them to be pursued and developed. “Opening up the conversation and searching for solutions among a broad, but qualified, audience has allowed us to find unique, innovative ideas in a short period of time,” said Matthew Bishop, U.S. business editor and New York bureau chief for The Economist.

The America Invents Act, which just recently passed by the Congress and sent to the White House for President Obama’s signature, is the most significant patent reform legislation in decades, and it promises to change virtually all of patent practice as we know it over the next 18 months. Some pieces of the legislation will go into effect almost immediately,…

The canonical story of the lone genius inventor is largely a myth. Edison didn’t invent the light bulb; he found a bamboo fiber that worked better as a filament in the light bulb developed by Sawyer and Man, who in turn built on lighting work done by others. Bell filed for his telephone patent on the very same day as an independent inventor, Elisha Gray; the case ultimately went to the U.S. Supreme Court, which filled an entire volume of U.S. Reports resolving the question of whether Bell could have a patent despite the fact that he hadn’t actually gotten the invention to work at the time he filed. The Wright Brothers were the first to fly at Kitty Hawk, but their plane didn’t work very well, and was quickly surpassed by aircraft built by Glenn Curtis and others – planes that the Wrights delayed by over a decade with patent lawsuits.

So the point is that there is the language of the bill, and then there is what we were told was in the bill, which actually isn’t what is in the bill if you are reading the plain meaning. In the coming days President Obama will sign the bill and then the Courts will embark on the long journey to decipher the text and tell us what it means. All the while the USPTO will be proposing and then enacting new rules. Patent law, practice and procedure is in a state of flux to say the least.

It looks like my prediction on Tuesday that the Senate would pass H.R. 1249, the America Invents Act, prior to President Obama’s much anticipated jobs and economy speech that begins at 7:00pm ET today, Thursday, September 8, 2011. The Senate voted to pass H.R. 1249 and send the House version of the America Invents Act to the White House for President Obama’s signature by a vote of 89 to 9. The Coburn Amendment, which would have once and for all put an end to fee diversion, was unsuccessful, being tabled by a vote of 50 to 48.