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Jul 23, 2007
 |  BioCentury  |  Politics, Policy & Law

Patent reform scorecard

Patent reform scorecard

Patent reform scorecard
The House and Senate's respective judiciary committees last week passed their Patent Reform Acts, but the chairs of both committees, Rep. John Conyers Jr. (D-Mich.) and Sen. Patrick Leahy (D-Vt.), indicated that some sections of the bills still need fine tuning before being brought to a full vote on the floor of each chamber. The unfinished business includes the method of apportioning damages based on advances over prior art; the prior user rights granted to a second inventor that never disclosed the invention; and the PTO funding provision in the Senate bill. Although not high on the list of concerns for biotech (and therefore not in this table), the method of selecting a venue for litigation is also causing friction between those aiming to stop "opportunistic forum shopping" and lawmakers who represent districts that have above average rates of finding for the plaintiffs. CAFC = Court of Appeals for the Federal Circuit - Aaron Bouchie
Current law Proposed under H.R. 1908 Proposed under S. 1145 Stakeholder positions
Right of the inventor to obtain damages. When a court determines a patent has been infringed, the infringer must pay a "reasonable royalty" in damages, typically a rate that would have been agreed on at the time infringement began. Courts generally consider the 15 so-called "Georgia-Pacific" factors laid out in a 1970 decision. A patent holder can also obtain up to treble damages if infringement was deemed to be "willful." If a second inventor of a method commercializes the subject matter at least one year before the effective filing date of a patent, then the second inventor is exempt from infringement. Would require the court to emphasize one factor over all the rest in setting damages, namely limiting the reasonable royalty "only to that economic value properly attributable to the patent's specific contribution over the prior art." The bill clarifies that an invention combining known elements could have a value greater than the value of the prior art. The bill also would make it more difficult to find infringement to be "willful." Additionally, the prior use defense clause would extend to all inventions, not just methods, and would exempt from infringement inventors who "commercially used, or made substantial preparations for commercial use of, the subject matter before the effective filing date of the claimed invention." Would also require the PTO to study the effectiveness of these provisions and present the finding to Congress every seven years. Contains similar language for limiting a reasonable royalty "only to the portion of the economic...

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