Patent Reform Is Off the Table in the Senate for Now. What Happened?

The long-running effort in the Senate to reform the patent system, a push that had appeared to be stalling of late, stopped entirely on Wednesday when the Judiciary Committee shelved the legislation. Industry groups reacted strongly.

Patent reform—a hot topic in Congress for months—appears to have suffered a critical blow.

Despite bipartisan support, the easy passage of the House version of a reform bill, a widespread dislike of so-called patent trolls among many business groups, and the drumbeat for the legislation from the tech sector, the Senate Judiciary Committee tabled the Patent Transparency and Improvements Act on Wednesday after its members were unable to reach a consensus on its details.

The key has always been to find the right balance: deal with truly abusive behavior, while making sure that real innovators can enforce their rights.

“Unfortunately, there has been no agreement on how to combat the scourge of patent trolls on our economy without burdening the companies and universities who rely on the patent system every day to protect their inventions,” Sen. Patrick Leahy (D-VT), the committee’s chairman, said in a statement. Leahy expressed hope of returning to the issue later this year.

The decision to table the measure was something of a surprise. Legislators had been working on it as late as Wednesday morning, with one advocate telling The Washington Post that the bill’s language had been finalized. But Leahy’s move puts any further action on hold.

From Push to Tip-Over

While the bill had strong backing early on, support faded as universities, biotechnology groups, and trial lawyers raised concerns.

These opponents—some of whom sent a letter to Judiciary Committee members [PDF] in recent days urging them to stop action on the bill—apparently played a pivotal role in the decision. The Hill reported that Senate Majority Leader Harry Reid (D-NV) intervened behind the scenes, deciding not to bring the bill to the floor because of the opposition from pharmaceutical firms and trial lawyers. A key objection of the trial attorneys involved a provision that would have shifted the legal fees to the loser of a patent infringement lawsuit, which the lawyers argued could harm legitimate lawsuits, according to Politico.

Republicans expressed frustration over Reid’s apparent role in spiking the patent legislation.

“It’s disappointing the majority leader has allowed the demands of one special interest group to trump a bipartisan will in Congress and the overwhelming support of innovators and job creators,” Sen. John Cornyn (R-TX) said in a statement quoted by National Journal.

But critics of the bill say that there’s still opportunity to salvage something later on—as long as it addresses their concerns.

“This shows pretty clearly that addressing these issues is more complicated than many may have thought,” American Intellectual Property Law Association director Q. Todd Dickinson told WTAQ. “The key has always been to find the right balance: deal with truly abusive behavior, while making sure that real innovators can enforce their rights.”

Frustrations Expressed

The Senate bill had attracted a wide array of supporters, including several groups in the retail industry. Many of these organizations—represented by the Main Street Patent Coalition (MSPC)—vowed to try again.

“We are disappointed that the Senate Judiciary Committee couldn’t get the job done,” the MSPC’s Michael Meehan said in a statement [PDF]. “Without reasonable and essential reform, millions of businesses will continue to be at risk until Congress puts trolls out of business. The choice of special interests over small businesses was the wrong decision, but we aren’t giving up the fight.”

Meanwhile, Internet Association President and CEO Michael Beckerman called on Reid to act on an important issue.

“If it is not possible for the Senate Judiciary Committee to proceed with its own legislation, the Internet Association calls on Senate Majority Leader Reid to stand with innovators and bring the House-passed Innovation Act to the floor of the Senate for an up or down vote,” he said in a statement.

Senate Judiciary Chairman Patrick Leahy (D-VT), who shelved the patent reform bill Wednesday. (photo via World Economic Forum/Flickr)

Ernie Smith

By Ernie Smith

Ernie Smith is a former senior editor for Associations Now. MORE

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