Patent Reform Bill Passed by the United States House of Representatives

The House of Representatives passed its version of the America Invents Act (H.R. 1249) by a 304-117 vote on June 23, 2011. This follows the Senate passing its version back in March. The House and the Senate must now rectify the differences between the bills, and then each chamber must pass the reconciled version before being sent to the White House for signature. There may still be disagreements during the reconciliation process.  Even if reconciled and enacted, there could also be additional challenges to the legislation forthcoming, as some opponents have questioned the constitutionality of a key provision changing the U.S. patent system to a first-inventor-to-file system. Nonetheless, patent reform is now closer to becoming a reality than it has ever been in the last six years. A few of the key provisions are highlighted below. 

First-to-File

Perhaps the biggest change that will take place is the switch to a first-inventor-to-file patent system. As the language of the Senate and House versions stands now, the change to a first-to-file system will go into effect 18 months after the effective date of the final legislation. Under the new first-to-file system, there will be an increased urgency to get patent applications filed as early as possible because any third-party prior art available before the patent application filing date can be used to reject the application.

Post Grant Review

Another major change will be the creation of a new post-grant review system that will expand the ability to challenge the validity of granted patents. The legislation provides several options to challenge patents, each option having various timeframes and limitations as to the grounds for challenge. The details of the new system will be developed by the Patent Office.

Patent Office Funding

While a change in how the Patent Office is funded may sound like an accounting matter, its impact could be very significant.  Increased fee setting authority and an end to Congress’ ability to divert Patent Office fees for other uses should increase the speed with which the Patent Office can examine patent applications. The Senate version of the legislation gives the Patent Office fee setting authority that need not be approved by Congress and ends fee diversion. The House bill does not go quite as far in granting the Patent Office autonomy, but it establishes a separate Patent Office account into which Patent Office fees will be placed. Congressional appropriators would have the authority to release those funds only to the Patent Office. This is one of the differences that will need to be reconciled for the final legislation.

False Marking

Both the Senate and House versions limit false marking claims. Only the United States or a competitor who can prove a competitive injury will be able to bring a false marking lawsuit under 35 U.S.C. Section 292. This change will apply to any case pending on or after the date of enactment of the legislation.