Viet Dinh

When the Patent Reform Act of 2007 (S. 1145) soon reaches the Senate floor, Congress will be presented with a significant opportunity to affirm the goals the Framers envisioned for the patent system. Those goals -- to spur innovation by rewarding inventors and to disseminate pioneering knowledge to facilitate and further expand the marketplace of ideas -- have been thwarted in recent years by a system that has failed to keep pace with the rapid evolution of the economy and the nature of innovation. This landmark reform measure will restore the balance the Framers intended for the patent system.

The bill's primary sponsors, Senate Judiciary Committee Chairman Patrick J. Leahy (D-Vt.) and Senator Orrin G. Hatch (R-Utah), recognize that today's entrepreneurs face a rising tide of unnecessary and costly litigation caused in large part by a sharp increase in the number of low quality patents and legal rules that have made it easier for plaintiffs to obtain excessive damage awards. Ironically, the current patent system threatens to undermine the goals the Framers intended to promote when it was established.

The under-funded and over-extended United States Patent and Trademark Office does not have the resources to adequately evaluate the burgeoning number of applications, and too many low quality patents are being issued as a result. To paraphrase a recent Federal Trade Commission study of the patent system, these low quality patents pose significant competitive concerns.

To compound matters, in the last few years the courts have made it easier for plaintiffs to obtain large damage awards in excess of the actual harm caused by the infringement. The possibility of such enormous damage awards has triggered a dramatic increase in patent litigation, the cost of which has also grown. This increase in litigation and its costs have made it tremendously expensive for inventors to enforce their patents against infringers and to defend their patents against interloping speculators.

An example of the litigation abuse engendered by the current system is the rise of "patent trolls," speculators who acquire and sue bona fide patentees but neither contribute to or otherwise expand the marketplace of ideas nor increase or improve consumers' choices. These speculators profit at the direct expense of consumers and risk-taking inventors and investors.

All of these problems threaten the ability of America's inventors to innovate and compete in the global economy.


Viet Dinh

Viet D. Dinh is founder and principal of Bancroft Associates. Dinh previously served as U.S. Assistant Attorney General for Legal Policy at the U.S. Department of Justice from 2001 to 2003.