HR 1908 the Patent Reform Act of 2007 Passed by House of Representatives

07 September 2007 Publication
Authors: Stephen B. Maebius

Legal News Alert: Intellectual Property

Today the House of Representatives passed, by a vote of 220-175, HR 1908 the Patent Reform Act of 2007. Five amendments were made in order, including a lengthy managers amendment designed to gather more support and address concerns expressed by various groups leading up to the vote.

Parts of HR 1908 were opposed by the Administration, pharmaceutical companies, the Biotechnology Industry Association, the NanoBusiness Alliance, research universities, some large manufacturing companies, and others. It had the support of the Business Software Alliance, the high tech industry, and the financial services companies. The bill now heads to the Senate, where its fate is uncertain. A similar bill passed the Senate Judiciary Committee in July 2007.

The big issue in both bills that is drawing the most opposition has to do with "apportionment of damages" in patent litigation. HR 1908 would require a judge in a patent infringement case to use a defined set of factors for determining damages, as opposed to the current way damages are calculated where the court has discretion to weigh a larger number of factors.

The House provisions dealing with U.S. Patent & Trademark Office (USPTO) rulemaking continue to draw opposition as do the provisions on "inequitable conduct." The House bill also would switch the U.S. patent system to a first-to-file system, but only upon enactment of grace periods by other countries for inventor publications. In addition, the House bill provides a post-grant opposition system where the opposition must be brought within 12 months of the patent's issuance. Although it dropped the much-debated "second window" for opposition, the bill enhances the opportunity to file inter partes reexamination challenges at any time during a patent's term by eliminating estoppel as to issues that "could have been raised."

Efforts to further modify the legislation now shift to the Senate, where the Senate Leadership has stated an intention to bring the Senate bill to the floor in the next 5 weeks. This will be challenging as several of the amendments failed by slim margins in the Senate Judiciary Committee. Those amendments deal with the same issues that were controversial in the House. Senate rules are much more difficult to navigate, so the Senate Leadership or Judiciary Committee Chair will have to have a better process for all the stakeholders in order for the bill to pass the Senate. After the bill passes the Senate, a Conference Committee could be called upon to iron out the differences or a negotiated bill could be tacked on to a large "must pass" bill.

For more information about this topic, please contact Philip G. Kiko at pkiko@foley.com or Stephen B. Maebius at smaebius@foley.com.