Date: 2011-06-22
Speaker: JACKSON LEE (democrat)
Chamber: H
State: Texas

The period is now a yearId indicated 18 monthsbecause small businesses have to reach to others to help fund their inventions. and they let their secrets out of the bag. Eighteen months protects their disclosures for a period of time for them to be able to move forward. Lastly. I had a sunset provision that would help small businesses as well as relates to the sunset of the business method patents review. This could be a good bill. I hope that we can correct it. and I ask my colleagues to consider correcting this bill. Madam Chair. I rise in support of H.R. 1249. "America Invents Act." However I am concerned over the drastic fee charges that were made in the new Managers Amendment completely contrary to our agreement in the House Judiciary markupit takes enormous amounts of money from the work of the PTO. As a Senior member of the Judiciary Committee and a member of the Subcommittee on Intellectual Property. Competition and the Internet. I am proud to support this legislation because in many ways the current patent system is flawed. outdated. and in need of modernization. The Judiciary Committee labored long and hard to produce legislation that reforms the American patent system so that it continues to foster innovation and be the jet fuel of the American economy and remains the envy of the world. This legislation incorporates amendments that I offered during the full committee markup as it recognizes the importance of converting from a firstinventortouse system to a firstinventorto file will promote the progress of science by securing for a limited time to inventors the exclusive rights to their discoveries and provide inventors with greater certainty regarding the scope of protections granted by these exclusive rights. Further. this new system will harmonize the United States patent registration system with similar systems used by nearly all other countries with whom the United States conducts trade. This legislation will continue to ensure that the United States is at the helm of innovation. Our Nations Founders recognized the integral role the patent system would play in the growth of our nation. Within our Constitution. they explicitly granted Congress with the power to issue patents. The Founders were supporting a fundamental part of the American dream which is to live in a free land where ideas can be shared thereby leading to the individual ingenuity. invention. and innovation. Madam Chair. Article I. Section 8. clause 8 of the Constitution confers upon the Congress the power: To promote the Progress of Science and useful Arts. by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries. In order to fulfill the Constitutions mandate. we must examine the patent system periodically. The legislation before us represents the first comprehensive review of the patent system in more than a generation. It is right and good and necessary that the Congress now reexamine the patent system to determine whether there may be flaws in its operation that may hamper innovation. including the problems described as decreased patent quality. prevalence of subjective elements in patent practice. patent abuse. and lack of meaningful alternatives to the patent litigation process. On the other hand. we must always be mindful of the importance of ensuring that small companies have the same opportunities to innovate and have their inventions patented and that the laws will continue to protect their valuable intellectual property. The role of venture capital is very important in the patent debate. as is preserving the collaboration that now occurs between small firms and universities. We must ensure that whatever improvements we make to the patent laws are not done so at the expense of innovators and to innovation. The legislation before us. while not perfect. does a surprisingly good job at striking the right balance. From small towns to big cities. our country is filled with talent and genius. As it stands. the United States has four times as many patent applications filed here per year than in Europe. The United States Patent and Trademark office must have the tools to meet this demand. Failing to change the patent system as we know it will deny the men and women from around our nation fair and equal access to a streamlined and effective patent system. The current system has a backlog of hundreds of thousands of patents. nearly 700.000 applications are waiting to be reviewed. The USPTO is currently reviewing applications from 2007/2008. and using the fees received from the most recent patent applications to do so due to limitations in the current system under which the USPTO is funded. This has caused inventors and business creators to wait on average three years prior to receiving a determination on whether or not their patents are valid. Without that determination it is nearly impossible for a small business to receive the necessary venture capital. Thats a threeyear waiting period for struggling small businesses. this is a threeyear gap filled with financial uncertainty which leads to a threeyear delay in job creation. Only 4 out of ten applications. or 42 percent. of patent applications are approved. It is vital to have approval prior to attaining financing because there is a 58 percent chance that a patent will not be approved. Given our current economic environment. a three year backlog is too long for any individual to wait to build a business which will create new jobs. especially at a time when jobs are sourly needed by many right now. Patent reform is the key to economic change that could lead to untapped job growth. Since the creation of the USPTO in 1790 it has issued 7.752.677 patents and many of those patents have resulted in the creation of new jobs. In 2010. 121.179 patents granted by the USPTO originated in the United States of those granted 8.027 went to applicants in Texas. Imagine how many jobs could be created if there were not a 700.000 patent application backlog. Our current system is outdated and the backlog makes it evident that our system is in serious need of change. Patent reform must reflect the major advances in our society over the last 50 years. Since the last major patent reform how we live has been transformed by a variety of inventions such as the home computer. ATM. video games. cellular phones and mobile devices. and life saving technologies like the artificial heart. all of which have been invented since any major reform of our patent system. Madam Chair. patent reform is a complex issue but one thing is clear the innovation ecosystem we create and sustain today will produce tomorrows technological breakthroughs. That ecosystem is comprised of many different operating models. It is for that reason that we evaluated competing patent reform proposals thoroughly to ensure that sweeping changes in one part of the system do not result in unintended consequences to other important parts. Let me discuss briefly some of the more significant features of this legislation. which I will urge all members to support. H.R. 1249 converts the U.S. patent system from a firsttoinvent system to a first inventortofile system. The U.S. is alone in granting priority to the first inventor as opposed to the first inventor to file a patent. H.R. 1249 will inject needed clarity and certainty into the system. While cognizant of the enormity of the change that a "first inventortofile" system may have on many small inventors and universities. a study regarding firsttofile will be conducted by the Small Business Administration and the United States Patent Office to identify any negative impact this change may have on these inventors. Furthermore. H.R. 1249 adjusts the fee structure which funds the USPTO. giving them greater control over the fees they collect for patent services and enabling the USPTO to improve its efficiency and review more patents at a greater speed. Currently. the USPTO is funded solely by the fees its receives from its users. However. not all the fees collected are available for use by the USPTO because Congress appropriates a specific amount. and any fees above the appropriated amount are used for other nonUSPTO purposes. Under H.R. 1249. the USPTO will have greater control over the use of the fees it receives. giving them greater flexibility to make necessary improvements to the patent system.