Risky Business of Patent Reform
Gaffney, Frank, Jr., The Washington Times (Washington, DC)
Today the Senate Judiciary Committee is expected to act hastily on legislation eagerly sought by its chairman, Sen. Orrin Hatch. The sponsor's strategy for moving S. 507 - which has the benign-sounding title of "The Patent Improvement Act" - has seemingly drawn on the classic stealth tactics of a submarine captain: Run silent, run deep.
The effect of having this legislation surface for committee mark-up with negligible advance notice and with minimal opportunity for deliberation and debate is to maximize the chances of Senate approval of a legislative initiative that probably would not otherwise pass muster. That would be a serious mistake - for American economic competitiveness and for U.S. national security.
Indeed, this benign-sounding bill could have very adverse implications for innovative Americans whose constitutionally-mandated patent rights may be seriously infringed by such an effort to "streamline" the patent process. Particularly distressing is the fact that S. 507 would require the publication of patent applications 18 months after filing - irrespective of whether a patent has been issued.
This would have the effect of denying U.S. inventors protection against large multinationals or foreign-owned enterprises with a demonstrated interest in stealing America's technological seed-corn. In "War by Other Means," a recently published study of economic espionage and other unfair techniques, foreign governments and companies are using to undermine U.S. competitiveness, President Clinton's chief economist, Laura D'Andrea Tyson, is quoted estimating the U.S. lost $105 billion in potential sales from 1985-1989 due to patent theft by the Japanese.
Of particular concern is the prospect that such expedited publication of patent applications - entailing the disclosure of sufficiently detailed information to produce working models - will not only make wholesale patent infringement likely. It would also increase the chances that technology with considerable potential in the national security field may be released before that potential is properly evaluated and protected by patent secrecy orders.
Such objections caused several of the House version of S. 507's most controversial provisions to be eliminated when it was considered two weeks ago. Specifically, an amendment offered by Ohio Democrat Rep. Marcy Kaptur exempted individual investors, small businesses and universities from the requirement to publish patent applications within 18 months of filing. It also deleted a provision that would have greatly expanded the opportunities for "re-examination" of existing patents - an invitation to foreign and multinational corporations endlessly to challenge patents that already have been awarded. The latter feature, which remains in S. 507, would mean small businesses and individual investors would produce an enormous number of the nation's technological breakthroughs, could be blackmailed by the threat of such assaults on their patents, and the associated legal costs, unless the patents are shared.
Unfortunately, if Mr. Hatch's strategy succeeds, S. 507 will retain both the troubling provisions struck by the Kaptur amendment and those that remain in the House bill. A particularly insidious example of the latter is language granting "prior user rights. …