House Passes Patent Overhaul

House lawmakers passed a bill today to overhaul the U.S. patent system for the first time in nearly 60 years, Nathan Koppel notes on the Wall Street Journal Law Blog:

The House passed the America Invents Act on a 407 to 117 vote, WSJ reports.  The bill would change how the U.S. grants patents and award them to the party which is “first to file” an invention instead of the “first to invent” it. The change would bring the U.S. in line with other countries, according to WSJ.

The Senate passed similar legislation in March on a 95-to-5 vote. (Click here to see LB background on the Senate vote.)  The House and Senate must now negotiate a final bill before President Obama gets a crack at the legislation.

Why, you ask, do we need patent reform?

Some businesses complain that the current, “first to invent” standard results in too much litigation from individuals who claim they were first to own an idea even though they don’t have a formal patent.

“This bill is designed to help all inventors,” said Rep. Lamar Smith (R, TX), who chairs the House Judiciary Committee and helped author the legislation. The current system hurts inventors because it can lead to years of costly legal challenges to their patents, he said.

Some inventors and small businesses complained that switching to a “first to file” system would give large companies an advantage and hurt individual inventors, according to WSJ.

Congress has been trying to overhaul U.S. patent rules for more than a decade, but previous efforts to reach a compromise have stalled.

The Senate version of the legislation was backed by drug, technology and other industries that in the past have been divided on patent issues; they now are aligned, in part because thorny issues like what constitutes excessive damage awards have been settled by U.S. courts.