FTC Sets Patent Reform Town Meetings

Town meetings on key U.S. patent system reform proposals have been set for February and March in California, Chicago, and Boston, co-sponsored by the Federal Trade Commission, the National Academies' Board on Science, Technology, and Economic Policy, and the American Intellectual Property Law Association.

The three meetings will feature representatives from government, business, investors, scholars, attorneys, and others with stakes in the patent community online and off, and are scheduled to include involved discussion of key reform proposals tied to best practices including first inventors to file, publication, and related reforms; post-grant reviewing; litigation reform, including willfulness, inequitable conduct, and best modes; and shields to infringement liability, including prior user rights and experimental use exceptions, the FTC said.

Among the scheduled keynotes will be Microsoft senior vice president Will Poole, at the February 18 meeting in San Jose, California; University of Chicago professor and former deputy Treasury Secretary Kenneth Dam, at the March 4 meeting in Chicago; and, IBM Software Group chief technology officer for emerging technology David Boloker and BioPharma executive vice president Cavan Redmond, at the March 18 meeting in Boston.

All three events will feature luncheon speeches by U.S. Patent & Trademark Office undersecretary and director Jon Dudas.

The meetings will start with short explanations of proposed changes, the FTC said, with opportunities for patent system stakeholders to raise and discuss their pros and cons and potential improvements.

The FTC has already called for new patent system reforms, including the creation of a new administrative procedure that will make it easier for firms to challenge a patent’s validity at the Patent & Trademark Office, without having to raise an expensive and time-consuming federal court challenge.

The commission has also called for letting courts find patents invalid based on preponderance of the evidence without having to find clear and convincing evidence compels that result. "The current standard of 'clear and convincing evidence,'" the commission said releasing a late 2003 report on the subject, "undermines courts’ ability to weed out questionable patents. This is especially troubling, since certain PTO procedures and rules tend to favor the issuance of patents."

The National Academies' STEP Board said in a report earlier this year that economic and legal changes put new strains on the patent system, especially with patents sought – or bought – more actively and enforcement sought more vigorously.

"The sheer volume of applications to the U.S. Patent and Trademark Office – more than 300,000 a year – threatens to overwhelm the patent examination corps, degrading the quality of their work or creating a huge backlog of pending cases, or both," the STEP report said.

"The costs of acquiring patents, promoting or securing licenses to patented technology, and defending against infringement allegations in court are rising rapidly," the report continued. "The benefits of patents in stimulating innovation appear to be highly variable across technologies and industries, but there has been little systematic investigation of the differences. In some cases patenting appears to have departed from its traditional role, as firms build large portfolios to gain access to others’ technologies and reduce their vulnerability to litigation."

Patent reform has become a warm topic in the Adult Internet ever since the battle over Acacia Research's streaming media patent claims launched in earnest in 2002-03, with several adult Internet companies led by New Destiny/Homegrown Video and VS Media challenging the Digital Media Transmission patent group's validity in federal court.

Earlier this month, Acacia signed a letter of intent to buy the assets of an Illinois-based private patent holding company, Global Patent Holdings, which would give Acacia rights to another 27 patent portfolios, including patents pertaining to peer-to-peer technology and interstitial Internet advertising, the company said December 16. Acacia said it would not discuss details of those or any of the patents in the portfolios until the deal is finalized and closed.