US patent reform falters

The Patent Reform Act of 2007 has passed the US House of Representatives and is now before the Senate. But industry remains split over the workability of the legislation and President Bush has threatened to veto the legislation in its current form. The main plank of the act would switch the US from a first to invent basis for the issuing of patents to a first to file criterion. Smaller companies have claimed this would stifle innovation and favour larger, better resourced technology players. However, since the change is essentially intended to harmonise the US system with those in place almost everywhere else in the world, the switch is seen as more an issue of ‘if’ rather than ‘when’. More contentious today are the provisions in the act that would limit the size of fines for patent infringement and an allied appeals process, seen as being likely to take as long to complete as a full judicial review. Opponents of the bill say that large companies have overstated the case for patent ‘trolling’, litigation by companies that buy up unused and obscure patents in the hope that they may impinge on a genuine and more broad based innovation when it occurs. A powerful lobbying group – the Coalition for Patent Fairness – has claimed the activity of ‘trolls’ represents a major brake on research and development work, forcing companies through unnecessary and costly litigation. Many leading semiconductor players are backing the CPF, including Intel, Broadcom, National Semiconductor, Applied Materials, Cadence Design Systems and Synopsys. Other signatories include Apple, Microsoft and Cisco Systems.