'The Patent Reform Act of 2007 just passed the U.S. House Judiciary Committee. The bill is supported by Microsoft, Oracle, and others. The legislation would help prevent frivolous patents, reduce legal costs, and give more balance to the rights of patent defendants.
CNet News.com has extensive coverage on the bill, the background issues, opposition from Venture Capitalists, the competing bill in the US Senate, and the issue of "patent trolls". Hats off to the CNet staff for dedicating lots of time to this issue.
The Patent Reform Act still must be approved by the full House. The US Senate has its own version of patent reform in process. Once both bills pass they must then go to a joint Senate/House committee to agree on one common law for the president to sign.
Major provisions of the Patent Reform Act of 2007
- Limit patent suit damages to the value added over existing technology. Patent damage awards have been way out of line with the actual value of the specific patent in relation to the overall product in question. This bill would require the courts to look at the "free market" value of the patent if it were licensed in an "arms length" transaction.
- Patent review/mediation process managed by the US Patent Office. A special review board would allow parties to challenge issued patents and present prior art, and mediate disputes outside the courts. Patent suits are very expensive and time consuming. Microsoft spends more than $100 million a year defending patent suits. IBM, Oracle, Google and others spend similar amounts.
Another recent development is the Patent Peer Review Process at PeertoPatent.org This process allows anyone to submit "prior art" for consideration by the US Patent Office. Users vote on the most relevant and compelling prior art examples. The top ten submissions get forwarded to the USPTO for consideration before granting the patent. This is a pilot project being tested on 250 patent applications. If successful, the project could be applied to broader patent areas.
Should software patents be abolished? Lots of smart people have suggested software patents should be abolished because software is already protected by copyright law. It is a complicated issue. Here are a few questions to consider.
- If software patents were abolished who would benefit? Small companies or big companies?
- Do software patents protect innovation or restrict innovation? What are some examples of each?
- Should startups bother with patents? Can they afford the time and legal expense to get a patent? Can they afford to defend a patent?
What do you think?