U.S. Department of Commerce Letter on S.1145 -- The Patent Reform Act -- Echoes Concerns Expressed by Diverse Coalition of Nation's Economic Drivers

Washington, D.C. - The Innovation Alliance today welcomed the release of the Administration's views on The Patent Reform Act (S. 1145), as communicated by the U.S. Department of Commerce in its letter of February 4, 2008, and recognized that the Administration's views are consistent with the concerns raised by more than 600 companies and organizations from across the nation. Most notably, the Alliance drew attention to the lack of progress made to address the negative impacts associated with the bill's provisions on the apportionment of damages and new post-grant mechanisms to challenge the validity of issued patents.

The 6-page letter, addressed to Senator Leahy, acknowledged the need to improve patent quality as a means by which to reduce patent litigation costs and increase certainty, but cautioned that the interests of innovators across industries had to be balanced.

Commenting on the letter's statements regarding damages, Susan Mora, spokesperson for the Innovation Alliance, said, "We agree with the Administration that the current bill will create risks to the patent system that are -- to quote the letter -- overwhelming. In fact, the bill's damages provisions will cause more problems than they solve, increase uncertainty, and thus potentially hike litigation costs for years to come."

"We also have concerns with the current bill's provisions regarding post-grant opposition, venue, applicant quality submissions, and inequitable conduct, " stated Mora. "Taken together, the bill's misguided approach to these issues would pose serious negative consequences for innovation and American jobs and technological leadership. We're hopeful the Senate will ultimately apply the same test to the legislation as the Department of Commerce has and that our concerns will be addressed."

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