By Kevin E. Noonan  —

To quote Lawrence (Yogi) Berra, "It’s déjà vu all over again" — Senator Patrick Leahy (D-VT) (at right), joined by Senators Orrin Hatch (R-UT) and Chuck Grassley (R-IA) are planning to introduce (yet again) a patent reform bill.  Stating that "[t]he Patent Reform Act [of 2005 2007 2009 2011] will keep America in its longstanding position at the pinnacle of innovation," the provisions of the bill are discussed generally on Senator Leahy's website.

The bill provides these specific provisions:

Sec. 1. Short title; table of contents.
Sec. 2. First inventor to file.
Sec. 3. Inventor’s oath or declaration.
Sec. 4. Damages.
Sec. 5. Post-grant review proceedings.
Sec. 6. Patent Trial and Appeal Board.
Sec. 7. Preissuance submissions by third parties.
Sec. 8. Venue.
Sec. 9. Fee setting authority.
Sec. 10. Supplemental examination.
Sec. 11. Residency of Federal Circuit judges.
Sec. 12. Micro entity defined.
Sec. 13. Funding agreements.
Sec. 14. Tax strategies deemed within the prior art.
Sec. 15. Best mode requirement.
Sec. 16. Technical amendments.
Sec. 17. Effective date; rule of construction.

The bill is "nearly identical" to the Manager's Amendment of S. 515 from the 111th Congress.  It includes similar or identical provisions on venue, best mode, false marking, and easing the residency requirements for Federal Circuit judges.  It also contains provisions to "transition" U.S. patents to a "first inventor to file" system (like earlier bills, this is distinct from "first to file" systems abroad, which are based on absolute novelty) and "first window" post-grant opposition provisions.

The bill also contains an effective ban on patents for tax (presumably avoidance) strategies, by considering such methods to be statutorily in the prior art.  It continues efforts to harmonize U.S. patent law with the law of foreign jurisdictions by providing for third party submission of prior art to the Office during ex parte prosecution.  It also includes two post-grant provisions for reconsideration of a granted patent:  a "first window" post-grant opposition (limited to the first 9 months after patent grant), and a revised inter partes re-examination proceeding, with adversarial proceeding before an Administrative Patent Judge before a Patent Trial and Appeal Board, as well as "procedural changes" to permit resolution within 12 months, establishing a "reasonable likelihood" threshold for initiating an inter partes re-exam, and an estoppel standard (for grounds of invalidity not raised during re-examination) precluding the requestor from raising an issue in litigation that "reasonably could have raised" during re-examination proceedings.

The bill also contains the "grand compromise" achieved by Senators Leahy, Dianne Feinstein (D-CA), and then-Senator Arlen Spector (D-PA) on the damages issue, establishing a "rigorous" gatekeeping role for the court in calculating damages and enhanced damages, that will "ensure consistency, uniformity, and fairness."  This part of the bill also contains provisions permitting "a party" to request that validity and infringement be decided by the trier of fact before damages are considered (a request that must be granted absent good cause).  The bill also codifies the willfulness standard ("clear and convincing evidence that the infringer acted with objective recklessness and the objectively-defined risk was either known or so obvious that it should have been known by the infringer") set forth by the Federal Circuit in In re Seagate, requires that willfulness be plead "with particularity," and mandates that the court cannot find enhanced damages if evidence of infringement, validity or enforceability is "a close case."

The U.S. Patent and Trademark Office does not get its long-desired rulemaking authority in the bill, but it does get fee-setting authority (which it can be expected will be wielded by the Office with an eye to influence applicant behavior, but contains mandates that small entity fees are reduced by 50% and "micro" entity fees are reduced by 75%).  Finally, the bill would permit the Office to establish a "supplemental" examination process "to incentivize patent owners to commercialize inventions despite potential flaws in the application process," and keeps provisions from S. 515 to "increase[] incentives for government labs to commercialize inventions."

Patent Docs intends to provide additional coverage of the new bill, with an emphasis on its potential impact on biotech and pharma patent practice, after we have had a chance to analyze the bill, and compare the new bill more closely to previously introduced legislation.