Encouraging Progress On Patent Reform

WASHINGTON (Thursday, March 19, 2009) – Senate Judiciary Committee Chairman Patrick Leahy (D-Vt.) Thursday said that advocates for patent reform are making progress in considering legislation that would bring the first significant reforms to the nation’s patent system in more than 50 years.  On March 3, Leahy and former Committee Chairman Orrin Hatch (R-Utah) introduced the Patent Reform Act of 2009.

Leahy and Hatch have introduced patent reform legislation in each of the last three Congresses.  On March 10, the Judiciary Committee held a hearing to examine needed reforms to the patent system.  At a business meeting Thursday, Leahy said that the bill sponsors had held productive meetings on the legislation with a number of offices.  The Patent Reform Act is cosponsored by Committee members Chuck Schumer (D-N.Y.) and Sheldon Whitehouse (D-R.I.), and Senators Mike Crapo (R-Idaho), Kirsten Gillibrand (D-N.Y.), and James Risch (R-Idaho).

“The hearing last week demonstrated that there is wide consensus among participants in the patent system, academics, and Senators on this Committee that patent reform is necessary,” said Leahy on Thursday.  “It should also be apparent, at least in my view, that the time for posturing has ended, and the time for reaching agreement has arrived.”

The Patent Reform Act of 2009 was scheduled to be considered by the Judiciary Committee during an executive business meeting Thursday.  As are allowed under the Committee’s rules, the measure was held over for one week.  The Committee is expected to debate the legislation in executive session next Thursday, March 26.

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Statement of Senator Patrick Leahy (D-Vt.),

Chairman, Senate Judiciary Committee,

Opening Statement

Executive Business Meeting

March 19, 2009

This is the third consecutive Congress in which Senator Hatch and I have introduced bipartisan patent reform legislation.  I thank Senators Schumer and Whitehouse for cosponsoring this legislation.  The hearing we held last week was the eighth this Committee has held since 2005 on patent reform issues.  Last Congress, the bill was the subject of consideration and amendments over four weeks of mark-up sessions in this Committee, and even after the Committee voted 13 to 5 to report the bill favorably, we continued to hold numerous meetings, briefings, and roundtables. 

While we have been deliberating, innovation and American inventors have been suffering from an outdated patent system and counterproductive litigation process.  I hope that the time has finally come for Congress to act.

The hearing last week demonstrated that there is wide consensus among participants in the patent system, academics, and Senators on this Committee that patent reform is necessary.  It should also be apparent, at least in my view, that the time for posturing has ended, and the time for reaching agreement has arrived. 

The most difficult issue remains the calculation of damages.  Now, I have a great deal of respect for the jury system.  I think the Supreme Court got it right earlier this month in upholding a Vermont jury’s award of damages in the Wyeth decision. 

But in some areas of the law, as good as juries are, they would benefit from more guidance.  In my view, just dropping 15 complicated factors into the laps of jurors and asking them to make a complex decision has become unhealthy for the system.  A University of Houston law professor suggested at recent FTC hearings, that:  “[This may be] why we are getting erratic results.  It certainly does not lend itself to . . . predictable results.”  Similarly, a Minnesota law professor testified that the factors “can be so easily manipulated . . . to reach any outcome.”        

Judge Edward Becker was a brilliant judge, a wonderful man, and a friend to many on this Committee.  Before he became the Chief Judge for the Third Circuit, in his days as a district court judge, he had occasion to write about the importance of the jury’s role, and its limits.  It was in the television antitrust cases, but the issue that he discussed in that complex economic context also resonates in the patent context we discuss today.  He upheld the right to a jury trial when some on the Third Circuit were ready to conclude that some matters are simply too complicated for a jury, and should be decided by the judge.  I respect our jury system and the Seventh Amendment guarantee of jury trials.  But I believe that in many patent infringement cases, the courts can be much more helpful to a lay jury, and they should be.  After all, it was the courts that over time developed the 15 factors that may be relevant to determining a patent infringement award.  It makes sense for the judge to help the jury by identifying the factors that will lead to an appropriate damages award. 

Senator Specter asked the witnesses at our hearing last week for language to describe what the test should be.  Many of them were close to using the same words in response.  We are looking for a way to get this right, to legislate responsibly. 

We are having very productive meetings with a number of offices.  The way to a resolution is not to stall this process now, but to amplify our efforts.  I appreciate those who are working cooperatively and collaboratively as we devise language that will allow us to respond to the growing consensus that we must modernize our patent laws.  I want our language to allow innovators in all sectors of our economy to flourish. 

Before we take up the Patent Reform Act, we have as unfinished business before the Committee today the President’s nomination of Dawn Johnsen to be the Assistant Attorney General to head the Office of Legal Counsel.  After turning to the Ranking Member for his opening remarks, I intend to recognize Senator Feinstein, who chaired the hearing on that nomination, and then proceed with our debate and our Committee vote on that nomination. 

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