Big business rallies over patent reform plans

Shahnaz Mahmud, New York

An influential group of multinational companies has launched a website outlining their views on patent reform.

The move by the Coalition for 21st Century Patent Reform -- a newly-formed group that lobbies for changes to US patent law -- comes as US politicians debate a series of bills to revise the legal frameworkgoverning IP rights.

The Coalition includes 3M, Caterpillar, General Electric, Procter & Gamble, Eli Lilly, Johnson & Johnson, Cargill, Henkel Corporation and Novartis, and represents companies in the manufacturing, IT, consumer products, energy, financial services, medical devices, drugs and biotechnology industries.

The Coalition's website sets out its patent law priorities. Its members want the US government to adopt the first-to-file principle, asrecommended by the National Academy of Sciences in its 2004 report, A Patent System for the 21st Century; and provide a post-grant opposition open review procedure that makes it easier to challenge questionable patents at the USPTO.

"The 'open review' procedure should be structured to provide adequate incentives for the public to make prompt challenges to patents once issued, protect investors against frivolous challenges or other potential harassment by challengers, and secure 'quiet title' for inventors following the opportunity for a patent to be challenged," says the Coalition on its website.

The Coalition also sets out a list of policy options that the government should reject.

These include granting broad rulemaking authority to the USPTO on issues of substantive patent law; enacting a loser pays principle forawarding attorney fees; repealing 35 USC s. 271(f), which permits patent infringement claims to be circumvented by making the components of patented products in the US and assembling them offshore; and changing a patent owner's prerogative to choose a reasonable judicial venue for enforcing a patent.

The House Judiciary Subcommittee on Courts, the Internet, and IP began its review of patent law in mid-February. It held a hearing entitled American Innovation at Risk: The Case for Patent Reform, led by committee chairman Howard Berman. The panel of witnesses included Adam Jaffe, professor of economics and dean of arts and sciences at Brandeis University; Suzanne Michel, chief IP Counsel and the deputy assistant director for policy coordination at the Federal Trade Commission; Mark Myers, co-chair of the National Academy of Sciences patent report; and Daniel Ravicher, executive director of the Public Patent Foundation.

Some of the issues discussed included the need for a presumption of validity versus the benefits of a robust post-grant opposition proceeding; standards on obviousness, wilfulness, and inequitable conduct; forum shopping in patent litigation; and harmonizing the US system with patent systems globally.

Akin Gump is advising the Coalition on its lobbying efforts on Capitol Hill.