Patent Reform: Good for Innovation. Good for Small Business. Good for America

Blog by Under Secretary of Commerce for Intellectual Property and Director of the USPTO David Kappos

Today I thought I would offer my thinking on a topic that is getting a lot of attention these days—patent reform. The 21st century, an undoubtedly technological one, demands a strong, clear and expedient patent system to ensure American competitiveness. Presently, that system is in immediate need of attention. That is why President Obama, Secretary Locke and I support Senate passage of S.23, the America Invents Act of 2011.

As outlined in our official Statement of Administration Policy released this week, the legislation updates our patent system by offering greater certainty about patent rights, lower fees for independent inventors and micro-entities and faster alternatives to expensive litigation. Moreover, it enables a financially stable USPTO that promotes growth for innovators in all industries and of all sizes.

I speak regularly with successful inventors, and they tell me exactly what they need to succeed: secure patent rights in order to access capital, hire employees, and build their companies. This demands a swift and efficient system that doesn’t leave intellectual property clogged in the pipelines. S.23 would enable the USPTO to set its fees and recover the actual cost of the services we provide to inventors without costing the taxpayer a dime. By providing our Agency with adequate resources, delays will be minimized and high-quality examinations will be completed in a shorter amount of time. This will help to clear the patent backlog and allow innovators to move ideas to the marketplace more quickly.

By moving the United States to a First-Inventor-to-File (FITF) system, the bill establishes greater speed and certainty about property rights in the innovation marketplace, while also leveling the playing field for anyone seeking to participate in global commerce. While I recognize some have concerns about this switch, the reality is that the current First-to-Invent system is fraught with peril. Under the current system, a host of objections can be raised in litigation that undermine a patentee’s rights. Such litigation is expensive and time consuming.

Passage of this legislation will also reduce the prohibitive cost of challenging issued patents by creating an in-house post-grant review process which will provide a faster and much cheaper alternative to costly and drawn-out litigation.

Enabling growth for industries of all sizes optimizes our ability to spur innovation, create new jobs, carve out new industries and enable new services to address social needs.

In the past 50 years we have seen more technological advancements than at any point in history but with no comprehensive patent reform to keep up with the times. In this century, we can’t expect tomorrow’s economy to take root using yesterday’s infrastructure. In order to bring ideas to market—in order to get ideas to capture funding—we must adopt a system that is more efficient for all who use it.

By enacting this bill, we’ll be able to revitalize our economy, unleash American creativity and win the future by catalyzing new industries that keep us competitive for generations to come.

Thanks for your continued support of the USPTO.As always, I’m interested to know what you think—in this case, about patent reform.