Leahy looking to move House-passed patent bill in Senate

After the House approved its bill on Thursday, Leahy noted that the bills “differ slightly,” and said “we should come together and approve this bill once again, and send it to the President’s desk to be signed into law.” Leahy’s email also noted that the House bill includes “many provisions adopted by the Senate in March” when it passed its version, S. 23.

Senate approval of the House bill would mean the adoption of several House changes, including one related to the authority of the U.S. Patent and Trademark Office to set patent application fees. The House also added language through an amendment from House Judiciary Committee ranking member John Conyers (D-Mich.) that will help one company, The Medicines Co., keep one of its patents for a longer period of time.

That amendment was approved after members agreed to hold a new vote on the amendment, after Democrats said not all members had a chance to vote.

The possibility of swift Senate passage of the House bill is also allowing some objections to the bill to resurface, and could prompt an effort to fight for a House-Senate conference on the bill in an effort to make changes. The bill is controversial for several reasons, including the inclusion of language that opponents say would make it easier for financial institutions to challenge business method patents.

Supporters of this language argue that the U.S. Patent and Trademark Office has approved several low-quality business method patents that should be allowed to be reviewed, including patents held by a wide range of industries.

But opponents say the language is essentially aimed at a narrow range of business method patents that are held by financial institutions, and is an attempt to create a new process aimed at invalidating these patents. Data Treasury, which owns the right to some of these patents, argues that the language would give these institutions another chance to override the patents, and has portrayed the language as another bailout for banks.

“This provision isn’t about reforming the patent process or creating jobs,” said Claudio Ballard, chairman and CEO of Data Treasury. “It’s about Congress doing a big favor to the banking industry at the expense of inventors and small business entrepreneurs.”

Specifically, the bill would create a new pilot program allowing USPTO to re-examine these business method patents to see if there is evidence of prior use, which could invalidate the patent. Opponents say this would give the government another way to challenge patents, even those that have survived prior judicial scrutiny.

They also note that the House bill allows the pilot program to run for eight years, more than the four-year program in the Senate bill.

Supporters have insisted throughout that the language at issue is not aimed at Data Treasury.

“This is about the abuse of our patent and legal systems by those who flaunt low-quality patents,” said Peter Freeman, vice president for insurance and trade at the Financial Services Roundtable. “A patentee has nothing to worry about if his or her patent is valid.”

Freeman and others note wide industry support for the bill, and that the language has been approved at several levels in both the House and Senate. Last week, the House rejected an amendment to strike the language in a 158-262 vote.

The patent bill was also controversial because of arguments that it would violate the U.S. Constitution by requiring a move to a first-inventor-to-file process. But despite these controversies, the House bill was approved last week in a 304-117 vote, and the Senate version was approved in March in a 95-5 vote.

—This story was updated at 10:11 a.m. to add the Financial Services Roundtable quote.