• 04-05-2011 | 07:07 AM
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Change Is in the Air: Be Ready for a First-To-File Patent System

Patent law change has become likely this year. The pending legislation would grant patent rights to the inventor who is first to file a patent application for an invention. In switching, U.S. patent law would resemble that of Europe, Japan, and, indeed, most other countries of the world. In this Analysis, Bruce D. Sunstein, the founder of Sunstein Kann Murphy & Timbers LLP, discusses the implications of this crucial change. He writes:

     The U.S. Supreme Court engaged in its own patent reform efforts by raising the standard required to show that an invention would not have been obvious (KSR Int'l Co. v. Teleflex Inc., 550 U.S. 398 (U.S. 2007)) [enhanced version available to lexis.com subscribers / unenhanced version available from lexisONE Free Case Law], making it harder to get an injunction (eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388 (U.S. 2006)) [enhanced version / unenhanced version], making it easier for a licensee and others to launch declaratory judgment proceedings to challenge a patent (MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118 (U.S. 2007)) [enhanced version / unenhanced version], and protecting a software company from U.S. patent liability for overseas sales of U.S.-developed software (Microsoft Corp. v. AT&T Corp., 550 U.S. 437 (U.S. 2007)) [enhanced version / unenhanced version].

     Meanwhile, many organizations, including organized labor, came out against patent reform as harmful to U.S. competitiveness. (The pharmaceutical industry, which depends on the patent system, was always against the reforms proposed by the software and electronics industries.) Then came the meltdown of the U.S. economy, and indeed the world economy. Technological innovation is now viewed as important to spurring the economy.

     With these developments, some of the most controversial provisions (such as limits on damages) in prior versions of the legislation have been excised. The legislation passed by the Senate is no longer "patent reform" but rather the "America Invents Act." Aside from changing the patent system to one based on first inventor to file, perhaps the most important change that the Senate bill would make is allowing the Patent and Trademark Office to retain and use all fees that it collects.

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