House Passes Patent Reform Bill
By Andrew Ramonas | June 23, 2011 8:30 pm

After years of false starts, the House took a pivotal step Thursday toward finally sending the president patent reform legislation.

The House voted 304-117 in favor of the measure that supporters have said would provide the most significant update to the patent system in 60 years. The Senate approved its version of the bill by a 95-5 vote in March. The bills now will have to be reconciled.

“Today’s vote is a victory for America’s innovators and job creators who rely on our patent system to develop new products and grow their businesses,” House Judiciary Committee Chairman Lamar Smith (R-Texas) said in a statement. “The America Invents Act is the most significant jobs creation bill passed by Congress this year. No longer will American inventors be forced to protect the technologies of today with the tools of the past.”

The Senate and House bills would ensure that the first person who submits an application gets the patent, switching from a “first-to-invent” system. The bills also are designed to help the Patent and Trademark Office get more money to address an application backlog that includes more than 700,000 submissions.

The House bill overcame a last-minute stumbling block over concerns from Chairmen Paul Ryan (R-Wis.) of the House Budget Committee and Harold Rogers (R-Ky.) of the House Appropriations Committee about  a provision allowing the Patent and Trademark Office to keep the fees it gathers from patent applicants, according to The Associated Press. The fees currently are put into the Treasury, and the Patent and Trademark Office receives congressional appropriations to fund its operations.

Under a deal reached between Republican House leaders, a Treasury fund would be established for fees received beyond the office’s budget. Only the Patent and Trademark Office could access the fund, keeping the money out of the reach of lawmakers who might want to spend it on other things. But the office would need to notify Congress how it would use the fund before accessing it.

The Senate bill currently has the provision that would allow the Patent and Trademark Office to keep the fees it gathers from patent applicants. Senate Judiciary Committee Chairman Patrick Leahy (D-Vt.) said in a statement  that he was “disappointed” that House leaders changed the language concerning fee diversion in the House legislation. But the senator said the legislation still will benefit inventors and manufacturers, and he will work to send it to the White House, which has expressed support for the House bill.

Rep. John Conyers of Michigan, the top House Judiciary Committee Democrat, and Rep. James Sensenbrenner (R-Wis.), a former House Judiciary Committee chairman,  and Reps. Donald Manzullo (R-Ill.) and Dana Rohrabacher (R-Calif.), had different thoughts.

They wrote in a “Dear Colleague” letter on Tuesday that the legislation would “cost jobs, harm small start-up inventors, and stifle innovation and investment here in the United States.” In the letter, the House members expressed opposition to several of the bill’s provisions, including the proposed switch from a “first-to-invent” system and the fee diversion stipulation worked out this week.

“HR 1249 will not solve the 700,000-plus application backlog in the US Patent and Trademark Office, and in fact, invites more problems for American inventors and innovators,” Sensenbrenner said in a statement Wednesday. “If we really want to solve the problems in the patent office, we ought to pass a clean bill that allows the PTO to retain its fees and improve the processing of patent applications.”

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