Legal News

Patently Stalled

By Dan Slater

Earlier this month, the Law Blog reported on a big patent decision in Tafas v. Dudas, where a district judge voided PTO rules that sought to streamline the patent application process. Yesterday, another effort at reform — a piece of legislation that would make patents easier to challenge and rein in damage awards in patent litigation — ran into a roadblock. Here’s the WSJ report, from Greg Hitt.

“This was a missed opportunity,” said Patrick Leahy, a Vermont Democrat and the Senate Judiciary Chairman. Negotiations among “key senators,” reports the WSJ, have reached an impasse, preventing the bill from reaching the Senate floor this week.

Who disagrees? Oddly, the business lobby itself is divided over the legislation. An alliance of big technology and financial-services companies — including Cisco Systems, Apple, Bank of America and Goldman Sachs Group — supports the overhaul plan. They argue that current rules limit innovation and encourage litigation and costly judgments against patent violators. In contrast to the current system, which grants patent rights to the first investor, the bill would establish a “first to file” system, granting rights to the first party to apply.

But drug makers, some smaller tech companies, heavy manufacturers such as Caterpillar and Dow Chemical, and organized labor oppose it, according to the WSJ. They say the measure threatens to dilute the value of patents.

Pennsylvania’s Arlen Specter said he was trying to balance the interests of the groups with a stake in the legislation and didn’t feel comfortable enough with the proposed changes to sign off. “I think we need more time to get it right,” he said.

Sen. Leahy expressed disappointment and said the dispute was over “just a handful of words.” In a statement, he warned “thousands of hours” spent on negotiations were at risk of being wasted.

Full post as published by Law Blog - WSJ.com on April 18, 2008 (boomark / email).