Patent Law Professors Spar in Predicting Impact of America Invents Act on Innovation

Bloomberg BNA’s Patent Trademark & Copyright Law Daily™is the IP industry’s premier news service, offering objective, timely,and reliable daily news coverage and commentary from leading IP law...

By Tony Dutra

Patent law experts F. Scott Kieff, professor at the George Washington University Law School, and John R. Thomas, professor at the Georgetown University School of Law had starkly opposing predictions about the impact of the America Invents Act during a one-hour debate in Washington, D.C., sponsored by First Street Research Group.

The two disagreed in particular on how the AIA will affect innovation among small businesses and individuals.

The session was scheduled to coincide with First Street's publication of “Lobbying The America Invents Act,” a report detailing the lobbying effort underlying the AIA's passage. The report listed 318 organizations and over 1,000 lobbyists that engaged Congress in the patent reform debate. Together, these organizations spent over $400 million on such lobbying activity in 2011.

Debate Centers on Small Business Impact

Thomas is also a visiting scholar for the Congressional Research Service and was author of the CRS reports on patent reform for the last few years, with the most recent publication June 30. At the Nov. 17 session, Thomas said he had given over 100 briefings in Congress on various patent reform issues.

Kieff is also a senior fellow at the Hoover Institution and has written several articles for the organization criticizing the legislation that became law (H.R. 1249, Pub. L. No. 112-29) upon President Obama's Sept. 16 signing.

Session moderator Alexander Bronstein-Moffly of First Street asked about aspects of the bill that benefit small businesses and the individual investor, and the professors' competing views became apparent immediately.

Thomas argued that the bill contained “an extraordinary number of provisions designed to benefit” small businesses, universities, and individuals. “Their voices were very much heard,” he contended.

Kieff, however, decried the move to a first-inventor-to-file system and the new post-grant review proceeding as “death to small business.” He argued that the current first-to-invent system requires only that the inventor keep accurate lab notebooks on the invention, while FITF requires at least a provisional patent application filing early in the process, thereby imposing a significant cost for any startup company.

Challenges at PTO Versus in Court

Thomas and Kieff also differed as to the impact under the AIA of shifting some patent law litigation from the courts to the Patent and Trademark Office.

Thomas contended that the new and revised “expedited, lower-cost dispute resolution mechanisms [at the PTO] are clearly superior to litigation” for both patent owners and challengers.

But Kieff argued, “We have seen an immense amount of pure political influence at the patent office.” He predicted that, by allowing the PTO to resolve more patent disputes, the agency will become like the Environmental Protection Agency or Food and Drug Administration, with more rule-making authority, and susceptible to “K Street” lobbying.

Thomas said that rule-making authority granted to the agency under the AIA was adequately cabined, but Kieff countered that the PTO's claimed expertise in resolving patent matters may embolden it to make policy decisions that will be politically influenced.

Thomas, though, countered that the U.S. Court of Appeals for the Federal Circuit, in handling appeals of patent disputes, is equally subject to political influence. He noted that most of the judges had experience on Capitol Hill before joining the court, and he further contended that it was obvious, throughout the six-year patent reform debate, that the appeals court took up topics in court cases that matched what was being most hotly debated in Congress at the time.

Reform Is Not Over

Both professors agreed, however, that additional patent-related legislation is still in the works. Kieff predicted only small adjustments to patent law in the next few years, while Thomas believed there will be more significant changes ahead.

Thomas noted specifically the legislation, S. 27, on limiting so-called “pay-for-delay” or reverse settlement payments between brand name and generic pharmaceutical companies, reported out of the Senate Judiciary Committee in July. “Congress is now in play,” he said, suggesting that even more industry-specific requests are forthcoming.

The impact of the AIA on patent-dependent industries, is “going to be bad” over the next 5-10 years, Kief predicted, but Thomas said he was “far less cynical.”

But Kieff was not swayed. He worried that the conditions that allowed the United States to lead the world in biotechnology innovations—while other countries refused to grant patents on that subject matter—would end under the AIA.

By enacting patent reform, he cautioned, “I think we just killed the goose that laid the golden egg.”


The First Street report is at http://firststreetresearch.files.wordpress.com/2011/11/first-street-report-lobbying-the-america-invents-act.pdf  

Thomas is a member of this journal's advisory board.