Archive for September, 2011

America Invents Act: Other Provisions in Effect Now

September 27, 2011

The biggest changes from the America Invents Act will not be seen for some time, several years in some instances.  The Act does, however, have a number of provisions that have already gone into effect.  I have previously discussed the Prior Use Defense and the Fee Setting Authority.

Inter Partes Reexamination

For all inter partes reexamination requests filed after September 16, 2011, the threshold inquiry for granting such a request has been changed from “a substantial new question of patentability affecting any claim of the patent” to “a reasonable likelihood that the requester would prevail with respect to at least one of the claims” in the patent.  This new standard appears to be stricter than the old standard, making it more difficult for requests to be granted.  At the end of one year, the PTO will be transitioning away from this proceeding to inter partes review and post-grant review proceedings.  Interestingly, ex parte reexamination standards are not changed by this provision.

Tax Strategies

As of September 16, 2011, “any strategy for reducing, avoiding, or deferring tax liability, whether known or unknown at the time of the invention or application for patent, shall be deemed insufficient to differentiate a claimed invention from the prior art.”  The section thus precludes patents for tax avoidance strategies.  It does still permit patents for inventions related solely to preparation and submission of tax returns and solely to financial management.

Best Mode

The U.S. patent system will continue to require that patents disclose the best mode for implementing the invention of which the inventor is aware.  As of September 16, 2011, however, failure to disclose the best mode is no longer a basis for holding a patent to be invalid or unenforceable.

Human Organisms

As of September 16, 2011, no patent may issue “on a claim directed to or encompassing a human organism.”  This section applies to all pending applications and later-filed applications, but does not affect issued patents.  This section does not change the current law, but merely codifies existing PTO policy.  MPEP § 2105 provides:

If the broadest reasonable interpretation of the claimed invention as a whole encompasses a human being, then a rejection under 35 U.S.C. 101 must be made indicating that the claimed invention is directed to nonstatutory subject matter.

Venue

In situations where the PTO may be sued in a civil action, such as in an interference or to obtain a patent, the Act changes where such actions must be filed.  Previously, such actions had to be filed in the District Court for the District of Columbia.  Now, they must be filed in the Eastern District of Virginia.

Track I Prioritized Examination

The AIA gives the PTO statutory authority to enact its earlier proposed Prioritized Examination plan.  Prioritized examination went into effect on September 26, 2011.  The fee for prioritized examination is $4,800 for large entities and $2,400 for small entities, in addition to the normal filing an examination fees.

More information on the effective dates of the various provisions of the Act is available here.

America Invents Act: PTO Fees

September 23, 2011

The America Invents Act signed into law last week by Pres. Obama changes a number of things about fees charged by the PTO.

15% Surcharge

First, 10 days after the Act’s effective date, certain PTO fees will by subject to a 15% surcharge.  This means that starting on Monday, September 26, many PTO fees will be increasing.  These include virtually all patent fees at the PTO other than international stage PCT-related fees.  This surcharge will remain in effect until the PTO sets fee levels pursuant to Section 10 of the Act, discussed below.

Fee-Setting Authority

Section 10 of the Act provides the PTO will fee-setting authority.  Rather than waiting for Congress to determine how much it should charge for various filings and services, the PTO will be able to use the notice-and-comment rulemaking procedure under the Administrative Procedure Act to set fees at the level that it believes is necessary to perform the services required.  The PTO will propose certain fee amounts and the public will have the opportunity to comment on the fees prior to their enactment.  The PTO will then be able to take the comments into account, or not, prior to setting the final fee amounts. 

The PTO plans to use additional fee revenue to undertake a massive hiring program for examiners and other personnel required to undertake the various aspects of the America Invents Act.

This all sounds great.  What is the downside?

Micro-Entity

First, small inventors and universities were to get some relief in the form of the new micro-entity status that will permit them to pay certain PTO fees at a 75% discount.  Unfortunately, the micro-entity provisions of the Act are contained in Section 10 which also grants the PTO fee-setting authority.  Thus, the PTO has interpreted this to mean that it cannot permit micro-entity status until it has enacted fees pursuant to this section.  This could take a number of monts to go through the required Federal Register notice-and-comment procedure.

Fee Diversion

Perhaps more importantly, Congress no longer passes a federal budget.  Instead, the government continues to operate (just barely) on short term continuing resolutions.  Despite congressional promises to the contrary during pendency of the America Invents Act, these continuing resolutions typically do not contain the promised language ending fee diversion.  They permit and sometimes encourage Congress to continue to raid PTO fees.  Thus, the 15% surcharge becomes a 15% tax on inventors to fund the government generally, rather than the PTO specifically.

The Act mandates a number of new obligations by the PTO, but doesn’t guarantee funding to pay for them.

IP Watchdog has more on this issue.

Book Review: Great Patents

September 21, 2011

Advanced Strategies for Innovative Growth Companies

Edited by David B. Orange

http://www.logos-press.com/books/great-patents.php

Great Patents is a collection of essays on patent strategy and valuation.  As Orange notes in the Introduction, there is a gap between simple patent primers, aimed at those who know little or nothing about patents, and detailed expositions of patent theory, aimed more at patent academics.  Great Patents “aims to inform executives on how best to improve their competitiveness.”  Just getting patents is not enough.  Figuring out how and when to use your patents is the key to successfully utilizing IP for a competitve advantage.

The first seven essays focus on patent strategies, while the last four focus on patent valuation.  Orange acknowledges some overlap between the two, but this seems like a good break down.

“How a Young Company can Build and Manage its Intellectual Property” is written by Lawrence Rozsnyai, Senior Director of Intellectual Property and Legal Affairs at a clinical-stage pharmaceutical startup company in the San Francisco Bay Area.  Rozsnyai’s chapter deals with many of the issues facing a young company determining how to protect its technology.  Topics that are covered include how to select IP counsel, when and how to decide to file provisional applications vs. non-provisional applications, tips for writing the first few patent applications, how to train R&D staff to properly protect the IP, and even some next steps.

Rozsnyai’s chapter contains some valuable information and strategies including how patent applications may differ depending on the goal of broad coverage vs. quick issuance, avoiding disclosing too much in patent applications about nascent technology, claim drafting, defining terms, and providing sufficient examples.  He briefly covers how R&D personnel should be trained to document and maintain IP as it is developed, how they should work with IP counsel, and how to keep notebooks and invention disclosure forms.  Finally, he provides recommendations to keep business goals in mind when crafting an IP strategy, be certain you have a freedom to operate in the area of innovation, and when and how to proceed to international patent protection.

“Present Patenting for Future Business Strategies” is written by Oscar Llorin, a patent attorney in Maryland.  Llorin’s chapter provides a bit more of a primer on the parts of a patent and the potential purposes of patents.  Next, for technology within the company’s main areas, he advises keeping patent applications pending so that it can be focused on competitors’ later-developed technology.  He also covers how post-grant proceedings, such as re-issue and re-examination applications, can be used to meet long term goals.

“The Tension Between Academic Authorship and Patent Inventorship” is written by John Evans, a patent attorney in Washington, DC.  Evans reviews the rather interesting fact pattern from a 1998 Federal Circuit case to demonstrate how authorship conventions in the scientific research community do not necessarily track actual contribution to conception of inventive concepts disclosed in the articles.  Thus, patent attorneys must investigate actual inventorship regardless of who is listed as an article’s author or risk losing the validity or ownership of the patent.

“Obtaining Patents and Trade Secrets for Health Technology Companies” is written by Kevin McCabe, an IP attorney in Washington, DC.  McCabe stresses the value of IP to a health technology company and contrasts this with the value to an electronics company, based on the number of patents covering key technology, investment timeframes, and barriers to market entry.  McCabe then spends a great deal of time providing a patent primer focusing specifically on issues that arise in the health technology field such as inherency, written description, and enablement.  Finally, he briefly addresses trade secrets and how they can be applied to health technology.

“Small Business Intellectual Property Considerations When Doing Business With the Federal Government” is written by William Bainbridge, a government contracts attorney in Washington, DC.  Bainbridge goes through the various opportunities for funding from the federal government that are available to small businesses.  He stresses the importance of preparing and understanding the contract with the government so as not to lose any rights in your property.  Finally, Bainbridge provides information on protecting technical data when transacting with the government.

“Standard Setting Organizations” is written by Marlin Blizinsky, a government relations officer near Seattle.  This chapter provides a primer on standard setting, including the purpose of standards, reasons that companies would or would not want to participate in standard setting organizations (SSOs), how SSOs operate and develop standards, and obligations of membership in SSOs.  Blizinsky gives special treatment to patent issues including licensing obligations and terms and how some SSOs seem to shun or avoid patented technology.  He provides guidance on antitrust issues within SSOs, as well as how standards are implemented and marketed by SSOs.  Blizinsky provides a great deal of information that may be helpful to an executive in deciding whether to participate in an SSO.

“A Patent Judge’s Perspective” is written by Luann Battersby, a patent attorney in Pennsylvania.  Battersby interviewed Neal Abrams who spent 17 years as an ALJ on the BPAI from 1987-2004.  Abrams provides tips on which cases to appeal, strategies for writing briefs, and best practices for oral argument before the Board.

“Patent Disputes” is written by Eric Fudo, an accountant and consultant who advises clients on economic damage issues in patent infringement matters.  Fudo provides an overview of damage calculation in patent cases, reviewing the standards for lost profits and reasonable royalty damges.  He provides a great amount of detail on what goes into such calculations and how the courts are requiring more detailed analyses from experts.  Issues regarding lost profits include calculating lost revenue and incremental expenses, and focusing not only on past profits, but also on future projected profits, taking the infringement into account.  Fudo also covers the elements of the hypothetical negotiation used to determine the reasonable royalty in patent cases.

“Developing and Evaluating Intellectual Property Assets” is written by Leo Jennings, an IP attorney in Virginia.  Jennings describes how to promote a culture within an organization that encourages innovation, such as how to encourage employees to participate in the process and how to document invention disclosures.  He covers other issues including international patenting, patent maintenance, enforcement, and how to determine whether to protect a particular invention.  Jennings then turns to monetary valuation of IP.  Various approaches are described, such as a cost approach, income approach, market approach, and hybrid methods.  Strengths and weaknesses of each method are reviewed, and he provides some advise on how to select the best method.

“Patent Sales” is written by David O’Steen, President of an IP boutique and patent brokerage firm.  O’Steen reviews ways to monetize patents, including litigation, licensing, and sales.  He focuses his chapter on how to sell a patent or patent portfolio.  He reviews how to determine what assets to sell, which assets may have potential buyers, who those buyers might be, and how to determine the value of a patent portfolio.  O’Steen reviews how a patent’s history or future potential of infringement, licensing, and litigation may affect its value and the potential buyers for the property.

O’Steen next reviews the three typical platforms for selling patents:  online, auction, or private sale.  He reviews the pros and cons of each platform, including the speed, number of buyers, and sales price potential for each, including who performs the sale.  Next, he reviews the due diligence to be performed on a patent portfolio, both by the buyer and by the seller.  This includes determining whether the patents have a clear chain of title and whether there is a potential income stream in the form of licensing revenue or infringement damages.

“Patently Ridiculous” is written by Gerry Langeler, Managing Director of a venture capital firm in Oregon.  Lengeler provides insight on whether and how venture capitalists choose to invest in patented technology.  He reveals that having a patent is less important than having the ability to execute the patent.  Lengeler provides a few stories that demonstrate why venture capitalists are hesitant to fund new endeavors:  uncertainty.  A mistake in the patent or a judge who rules in an unexpected way are several examples of such uncertainty.

Like most books that are compilations of writings, some of the essays in Great Patents are much better than others.  Some violate Orange’s statement of not providing a patent primer.  Overall, however, there is some good information and some inside or expert advise from different players in the field that are not always considered when making decisions regarding patents.  Great Patents is a worthwhile read.

America Invents Act: Prior Use Defense

September 21, 2011

One of the provisions of the America Invents Act was a newly expanded defense for prior use of an invention.  This defense applies to any patent issued on or after the Act’s effective date, September 16, 2011.

The previous version of the Patent Act contained a prior user defense, but the defense was limited to infringement of claims to business methods.  Now, the AIA has expanded the defense to all patents.

The New Statute (§ 273)

The defense applies to good faith commercial uses and arm’s length sales and commercial transfers that occurred at least one year before the earlier of (1) the effective filing date of the patent application, or (2) the inventor’s public disclosure that is an exception to prior art under the AIA’s limited grace period.  The party asserting the defense must prove the facts to establish the defense by clear and convincing evidence.

What is commercial use for purposes of the defense?  The statute does not specifically define commercial use so we won’t know exactly until the defense is tested in the courts.  The statute does provide several specific instances that would qualify as commercial use.  First, subject matter for which regulatory approval is required prior to commercial use would qualify during that period.  For example, FDA filings for drugs and medical devices would qualify as commercial uses even though not yet technically in the marketplace.

Second, use by a nonprofit research laboratory or other nonprofit entity, such as a university or hospital if the public is the intended beneficiary of the use would qualify as a commercial use.  The defense only applies to continued an noncommercial use by and in the laboratory or other nonprofit entity.  Thus, a university or hospital could not transfer the product or process to another entity that would commercially exploit the subject matter outside of the nonprofit entity.

The statute does restrict this defense to the first entity who is entitled to it.  This means the defense may not be transferred, assigned, or licensed to another entity, except as part of the good faith transfer of the entire entity or business line of the entity.  In such a case, the acquiring party may not expand use of the subject matter entitled to the defense beyond its original site.

The defense is limited to the specific claims that cover the subject matter to which it applies and not generally to the entire patent, except that changes may be made to quantity or volume, and improvements may be made to the subject matter provided that they are not specifically covered by other claims of the patent.

If the commercial activity that qualifies for the defense is abandoned, those activities that would otherwise qualify for the defense prior to the abandonment may no longer be relied upon for the defense.

Unless development of the subject matter of the patent utilized federal funding, the defense does not apply to patents that were made by, owned by, or subject to an obligation of assignment to a university or other entity of high education.

Finally, a patent may not be invalidated based on this defense and the unreasonable assertion of the defense would subject the entity raising the defense to a finding that the case was exceptional and an award of attorney’s fees to the patent owner.

Analysis

I previously covered the issues surrounding this defense, but they deserve to be reiterated here.  This defense is contrary to the purpose of the patent laws of “promoting the progress of science and the useful arts.”  The patent system promotes this progress by encouraging public disclosure of new inventions.  In exchange, the government grants the disclosing party a limited monopoly over the disclosed subject matter.  Once the patent expires, that knowledge and subject matter becomes a part of the public domain.

This defense rewards entities that keep innovations secret.  There is no longer a risk to keeping developments secret because you can always assert the prior use defense.  To be sure, trade secrets have their place, but the owner of a trade secret holds the technology in secret with the risk that it could be patented by someone else.  An expanded prior user rights defense would provide an incentive to keep new inventions secret.  Why bother with the patent system when you can simply practice your technology in secret and be shielded from liability for infringement of other parties’ patents?

I was wrong in my previous assertion that there would be a fight over this issue.  The statute does require a report on the issue, but it seems unlikely to go away.  This is another example of Congress whittling away the power of patents and the incentive to disclose new inventions to the public.

Federal Circuit Holds Internet Monetization Method is Patent-Eligible

September 15, 2011

The Federal Circuit ruled today that the claimed method of monetizing and distributing copyrighted products over the Internet is a patent eligible process in Ultramercial, LLC v. Hulu, LLC.

At issue in the case was claim 1 of U.S. Patent No. 7,346,545:

A method for distribution of products over the Internet via a facilitator, said method comprising the steps of:

a first step of receiving, from a content provider, media products that are covered by intellectual property rights protection and are available for purchase, wherein each said media product being comprised of at least one of text data, music data, and video data;

a second step of selecting a sponsor message to be associated with the media product, said sponsor message being selected from a plurality of sponsor messages, said second step including accessing an activity log to verify that the total number of times which the sponsor message has been previously presented is less than the number of transaction cycles contracted by the sponsor of the sponsor message;

a third step of providing the media product for sale at an Internet website;

a fourth step of restricting general public access to said media product;

a fifth step of offering to a consumer access to the media product without charge to the consumer on the precondition that the consumer views the sponsor message;

a sixth step of receiving from the consumer a request to view the sponsor message, wherein the consumer submits said request in response to being offered access to the media product;

a seventh step of, in response to receiving the request from the consumer, facilitating the display of a sponsor message to the consumer;

an eighth step of, if the sponsor message is not an interactive message, allowing said consumer access to said media product after said step of facilitating the display of said sponsor message;

a ninth step of, if the sponsor message is an interactive message, presenting at least one query to the consumer and allowing said consumer access to said media product after receiving a response to said at least one query;

a tenth step of recording the transaction event to the activity log, said tenth step including updating the total number of times the sponsor message has been presented; and

an eleventh step of receiving payment from the sponsor of the sponsor message displayed.

The district court had dismissed the infringement action holding that the claim was not directed to patent-eligible subject matter.  The Federal Circuit acknowledged that it has not provided a definitive rule that a claim be construed by the court prior to the patent eligibility determination, but strongly suggested that it may be helpful for courts to do so.

After once again reviewing the case law on patent eligibility from the Federal Circuit and Supreme Court, Chief Judge Rader, writing for the panel, easily found the claim to be a “process” within the meaning of the Patent Act and thus falls within a § 101 eligibility category.  The only issue is whether the claim falls within the abstract idea exception.

In its analysis of whether the claim is directed to an abstract idea, the court gave weight to the patent’s purported improvement of existing technology and that it invokes computers and applications of computer technology.  The claim does not merely recite the abstract idea that advertisement can be used as a form of currency, but relates to a practical application of this idea.  The various steps likely require intricate and complex computer programming, and specific application of the Internet and cyber-market environment.

Although the claim may not meet the other requirements for patentability under the Patent Act (novelty, non-obviousness, enablement, written description, etc.), it is not ineligible for patenting under § 101.

Enactment of Patent Reform Act

September 15, 2011

Pres. Obama plans to sign the patent reform bill on Friday, September 16.  This means that several parts of the legislation will go into effect shortly.

The PTO will be granted fee-setting authority (although not necessarily the right to keep all collected fees).  New fee amount will have to go through notice-and-comment rule-making as described below. 

The PTO will implement its previously planned Track I Accelerated Examination.  For a fee of $4,800/2,400, up to 10,000 applications during the first fiscal year will be placed on a fast track examination path having an office-wide goal of disposal within 12 months of granting accelerated status.

Micro-entity

A new fee level for a “micro-entity” should go into effect immediately upon enactment.  Micro-entities are entitled to a 75% reduction in certain PTO filing fees.  To qualify as a “micro-entity,” certain conditions must be met.

For unassigned applications, the entity must not include any inventors that have been named on 5 or more patent applications.  Thus, “micro-entities” are newer inventors.  The application must not be licensed or the inventors must not be legally obligated to license or assign the application.  Each inventor must have an income of less than 3 times the average gross income reported by the Department of Labor for the previous calendar year.

For assigned applications, the inquiry is similar.  None of the inventors must be named on 5 or more patent applications.  The application can only be assigned to an entity with 5 or fewer employees.  And the assignee must have an income of less than 3 times the average gross income for the previous calendar year.

15% Surcharge

On Sept. 26, a 15% PTO surcharge on patent fees goes into effect to aid the PTO’s funding crisis.  During a webinar yesterday sponsored by Foley & Lardner LLP, Patent Commissioner Bob Stoll announced a plan to hire 1500 additional patent examiners.  As noted by Hal Wegner, however, the PTO is currently funded by a continuing resolution of Congress that expires at the end of the current fiscal year on Sept. 30.  Because fee diversion was not ended by the new law, the agency is still at the mercy of Congress for its continued operations into FY2012.

Rule-Making

The new legislation will require significant rule-making by the PTO to implement the various sections.  The PTO must go through notice-and-comment rule-making procedures required by the Administrative Procedure Act to implement such new rules.  Thus, the PTO has set up a new website for this purpose:  http://www.uspto.gov/patents/init_events/aia_implementation.jsp.  The new rules will be published in the Federal Register and public comments are needed to promptely enact them. 

Several other aspects of the law also go into effect immediately, including the preclusion of multiple, unrelated parties in one patent suit, changes to the standard for granting reexamination requests, elimination of the best mode as a defense to infringement, preclusion of patenting of tax strategies, virtual patent marking, and the requirement of actual injury for false marking suits.

Evan Wallach Confirmation Hearing

September 12, 2011

Lost amid last week’s news surrounding passage of patent reform was the Senate Judiciary Committee’s confirmation hearing of Evan Wallach.  In July, Judge Wallach was nominated to a seat on the Federal Circuit to replace Judge Gajarsa who assumed senior status.

Judge Wallach’s hearing last week was described as a “welcoming reception” by the Committee.  He was introduced to the panel by Senate Majority Leader Harry Reid (D-NV), for whom Judge Wallach served as general counsel and advisor in 1987-88.  The Committee appeared inclined to advance his nomination, but there is still a backlog with bringing such nominations to the full Senate for a vote.  Sen. Reid said he will work to get Judge Wallach confirmed by the end of the year.

Meanwhile, the Federal Circuit works with only 10 of its 12 seats filled.  Edward DuMont has now been waiting 17 months for his hearing before the Judiciary Committee.  DuMont was nominted to the court in April 2010 to replace retiring Chief Judge Michel.

Senate Passes House Version of Patent Reform

September 9, 2011

Patent reform is a reality, as the Senate passed H.R. 1249 without amendment.  The voting on the proposed amendments was close; passage of the overall bill was not.

Senate Action

Sen. Jeff Session’s (R-AL) proposed amendment on retroactive patent term extension failed 51-47.  Sen. Maria Cantwell’s (D-WA) proposed amendment to strike the special business method reexamination procedure failed 85-13.  Sen. Tom Coburn’s (R-OK) proposed amendment to prohibit fee diverion failed 50-48; the Senate actually voted to table Sen. Coburn’s amendment, thereby killing it.

Finally, the Senate passed the unmodified bill 89-9.  Senators voting against the bill were:  Barbara Boxer (D-CA), Maria Cantwell, Tom Coburn, Jim DeMint (R-SC), Ron Johnson (R-WI), Mike Lee (R-UT), John McCain (R-AZ), Claire McCaskill (D-MO), and Rand Paul (R-KY).  The bill now proceeds to Pres. Obama for signature and enactment.

Effects of the Bill

The “effective date” of the bill will be the date it is signed by Pres. Obama and becomes law.  Most effects of the bill have been covered in detail on this site and will not be felt for some time.  These include the transition to first-to-file which takes place 18 months from the effective date (March 2013).

Some changes will take place sooner.  The “micro entity” filing status for 75% reduced fees takes place immediately, while the 15% surcharge on PTO fees and the $4,800 fee for prioritized examination take place 10 days after enactment.

A complete copy of the bill as passed is here.

Patent Reform Passage Appears Imminent

September 8, 2011

Yesterday, the Senate debated the House Patent Reform bill, H.R. 1249, and agreed to the motion to consider the bill.  Thus, the bill is now laid before the Senate.

The Senate has scheduled 5 hours of debate on the bill today beginning this morning.  Several amendments have been proposed and will be debated today.

Sen. Jeff Sessions (R-AL) has proposed an amendment that would strip a provision for retroactively lengthening the time for applying for patent term extension.  This provision was added to the bill due to lobbying efforts on behalf of a particular drug company.

Sen. Maria Cantwell (D-WA) has proposed an amendment to strip the special business method transitional reexamination program from the bill.  Alternatively, she seeks to amend this provision to clarify the definition of a business method covered by the program.

Finally, Sen. Tom Coburn (R-OK) has proposed an amendment that would prohibit Congress from diverting PTO fees.  The PTO would be permitted to spend all of the money that it collects from users.

Several other Senators have proposed political amendments, but these are the ones dealing with the merits of the bill.

At 4:00 today, the Senate will take roll call votes on the amendments.  After vote on these amendments, the Senate plans to vote on the merits of the bill. 

If any of the amendments are agreed to prior to passage, the amended bill must be returned to the House for further consideration by that body.  If all proposed amendments fail, the passage by the Senate would constitute passage of the final bill.  The bill would then proceed to Pres. Obama for signature and enactment.

Congressional action is hard to predict, but at this point it appears that passage is imminent.

House Patent Reform Bill Clears Hurdle in Senate

September 7, 2011

The Senate voted 93-5 to invoke cloture on the motion to proceed to consideration of H.R. 1249.  Only 5 Republicans voted against cloture:  Sens. Tom Coburn (OK), Jim DeMint (SC), Ron Johnson (WI), Mike Lee (UT), and Rand Paul (KY). 

Senate Rules

I am not an expert on parliamentary procedure or on the rules of the U.S. Senate, but the following is my understanding of how the debates and votes will proceed.  Please correct me if I am wrong.

The Senate has rather complex rules regarding bringing bills forward for debate, presenting amendments, and actually considering the bills on the merits.  Multiple votes are required on many bills.  While most votes on motions are simply passed by “unanimous consent,” or a voice vote, any sentor may request that an actual recorded vote take place.  The Senate rules permit unlimited debate on most motions and bills unless a vote is taken to “invoke cloture” on the debate.  Again, this vote may be dispensed with by unanimous consent, but otherwise requires 60 votes to pass.

When a bill is passed by the House, it is “referred to” the Senate.  The Senate may submit the bill to a committee or it may seek to present the bill to the entire chamber.  First, a bill must be “before the Senate” in order to be considered.  This requires a vote (or unanimous consent) of the Senate.  Once the bill is before the Senate for consideration, it may be amended and debated on its merits.

The Senate is not actually considering or voting on its own version of patent reform, S. 23, that is passed in March.  Instead, it is considering the House version of the bill, H.R. 1249, that the House passed in June.  Thus, it is necessary to get H.R. 1249 before the Senate for consideration on the merits.

Sen. Harry Reid (D-NV) made a motion in June to invoke cloture on the question of laying the bill before the Senate.  The actual vote yesterday was on Sen. Reid’s motion to  invoke cloture on the motion to proceed to consider H.R. 1249.  This is not a vote on the merits of the bill, but only on whether the Senate can move to consider the merits of the bill.  Debate on the merits of this motion will proceed today after the morning business in the Senate and requires a simple majority vote.  Once that takes place, the Senate can move to consider the bill on its merits.

While the Senate may reach agreements or unanimous consent on several of these steps, passage of the bill may not be quite as iminent as was originally thought.  The Senate may now take up to 30 hours to debate whether to consider the merits of H.R. 1249 before it actually does so.  Next, come the votes on the merits of the bill before its final passage.

Sen. Coburn’s Statement

Sen. Coburn has long been a proponent to ending fee diversion.  He proposed the amendment to S. 23 that would have ended th practice.  After yesterday’s vote, he issued a statement decrying fee diverion as a tax on innovation.  In his statement, he indicates that he will raise his amendment to end fee diversion once again.

If my amendment fails, I will do everything in my power to slow the bill and highlight this egregious tax on innovation.


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