House moves to vote on patent system overhaul

AP News
Posted: Jun 20, 2011 9:11 PM
House moves to vote on patent system overhaul

The House moved Monday toward a vote on the most significant overhaul of the patent system in six decades after Republicans agreed on how to fund the U.S. Patent Office so it can cope with patent applications that can now take at least three years to process.

The agreement sets the stage for a House vote later this week on legislation that would also switch the United States from the "first-to-invent" system now in effect to the "first-inventor-to file" system for patent applications used by all other industrialized countries. I

The legislation, which passed the Senate in similar form in March, has had bipartisan backing in Congress and enjoys the support of a diverse range of business groups, high-tech companies and academic groups that say it could make the patent application process fairer, more efficient and less subject to costly litigation.

The measure hit an obstacle in the House last week when Republican budget and appropriations chairmen objected to one of the main elements of the bill: allowing the Patent Office to keep all the user fees it collects from patent applicants. Currently those fees go into the general Treasury, and the office has to depend on what it receives from annual congressional appropriations, often a smaller amount.

Underfunding is seen as a major reason the agency has been unable to employ enough trained examiners to keep up with applications. The agency has a backlog of 1.2 million pending patents, including more than 700,000 that haven't begun the review process.

The compromise creates a reserve fund where any fees above what Congress appropriates to the Patent Office will be collected. This would put an end to the problem of fees being diverted for other government programs, but in order to access the reserve fund the office must work with Congress and be subject to congressional oversight of its spending. The GOP chairmen had expressed concern about ceding congressional spending authority to the federal agency.

The legislation, which has had the support of the Obama administration, would mark the first major overhaul of the patent system since 1952.

Any differences with the Senate bill will have to be reconciled. The provision ensuring that all user fees go to the Patent Office was a big selling point when the Senate passed the bill 95-5 last March. There was no immediate word from the Senate on the House approach to the user fees.