The U.S. House of Representatives has passed an important bill (H.R. 1908) on September 7, 2007 which, if enacted in its present form, could have significant implications for U.S. patent law. The proposed changes include :

  • transition from a "first to invent" to a "first to file" system;
  • limitation of damages awards for patent infringement based on "apportionment" principles;
  • limitations on findings of "wilful" infringement (and therefore triple damages)
  • post-patent grant review process for validity which would allow anyone to challenge a patent after it was issued ;
  • third party submission of prior art during patent examination;
  • limitations on the choice of venue for patent litigation;
  • "Markman" orders may be immediately appealed (currently not appealable prior to a final judgment)
  • limitations on defense of inequitable conduct

The amendments have pitted high-tech firms against large pharmaceutical firms. There is support from the technology and financial services sector, while receiving opposition from a broad range of other groups including pharmaceutical companies and the White House. The proposed changes are expected to go to floor debate in both the Senate and the House of Representatives early this month.

The general view of pharmaceutical companies, whose money-maker drugs are protected by one or two patents, is that reduced damages would weaken patents and that the post-grant review would hurt the U.S. industry, as "there is no public interest in a patent owner being harassed". The proposal to reduce damages is good news for high-tech firms who have a large portfolio of patents and where any case going to trial over one of the many patents could cost up to $10 million.