Pending Patent Bill Puts 'Global Harmonization' Above American Innovation

Congress is about to give multinational corporations such as IBM an even more outsized advantage over small businesses, independent inventors, and American innovators.

Hoping to rush legislation through while the public focuses elsewhere, mega-business’s water carriers are urging potentially disruptive colleagues to “trust us” on the patent bill speeding across Capitol Hill.

Conservative activists and many Tea Partiers have read every word about Washington’s budget standoff, taxpayer dollars going to abortionists at Planned Parenthood, and Obama’s involving America militarily in Libya’s internal affairs.  But who’s heard a word about “patent reform”?

Though the details of patent law make people’s eyes glaze over, how America awards patents carries serious consequences.

The danger is much closer than you think.  Senate Majority Leader Harry Reid (D.-Nev.)  recently jammed through Sen. Patrick Leahy’s S 23.  Conservatives in the Senate were asleep at the wheel, giving Obama-Leahy-Reid a 95-to-5-vote cakewalk.

Where Washington and globalist business are concerned, what you don’t know can hurt you.  In the patent arena, they’re pushing “harmonization.”  Which means we’re about to dumb down our patent system, aligning it with the rest of the world.

Why?  Because transnational companies such as IBM and Dow Chemical aren’t concerned about whether our patent laws give the United States an economic competitive advantage.  They prefer to make it easier on themselves so they can obtain patents in the same manner in one country as in another. 

It so happens that the patent model prevalent overseas favors global companies.  Chinese and Indian “pirates” can more easily steal intellectual property under those systems.

To connect some dots:  IBM is based in Leahy’s Vermont.  IBM is one of the biggest patentees.  Three-fourths of IBM’s employees work in other nations, to which IBM has shifted its research and development.

Washington is about to gut America’s successful, unique patent system.  This very system has made the United States the world leader in innovation.  The innovation the U.S. patent system has brought about has given America the world’s greatest economy—with the highest standard of living and a large, broad middle class.

Our Founders knew what they were doing when they wrote Article I Section 8 of the Constitution.  They explicitly empowered Congress to “secur[e]” “for limited times” to “inventors” “the exclusive right” to their “discoveries,” thus giving them individual property rights in their creations.

Why?  To “promote the progress of science and useful arts.”  A private property right would benefit this nation economically.

The image of the guy tinkering in his garage or laboratory and discovering a cutting-edge innovation is not make-believe.  Americans Thomas Edison, the Wright Brothers, Alexander Graham Bell, Steve Perlman (WebTV and QuickTime creator), Dr. Ray Damadian (inventor of the MRI) were all beneficiaries of our unique patent system.

From the beginning, U.S. patents have gone to the first person to invent something.  For nearly two centuries, U.S. inventors have enjoyed a grace period of at least a year to line up financing and business partnerships.  And until just the past couple of decades, U.S. patents could be challenged only in court, were kept secret before issuance, and lasted 20 years from patent issuance instead of application filing.

From First-to-Invent to First-to-File

The globalists’ misnamed “America Invents Act” adds a European-type post-grant review process.  That will make it easier to perpetrate challenges to a patent’s validity throughout the patent’s life.  Such challenges devalue the patent and add thousands of dollars to inventors’ costs.

The bill switches from a first-to-invent to a first-to-file basis for issuing patents.  Obviously, a mega-corporation can win the race to the patent office to file an application.  Independent inventors, university research spinoffs, and smaller companies get hammered by the first-to-file disadvantage.

Also, third parties—even competitors—can soon interject themselves into patent application reviews.

Cynically, there’s a gift for bailed-out banks.  The financial services industry, which has lost two previous tries, can again challenge the patent of inventor Claudio Ballard.  Bankers have repeatedly infringed Ballard’s patented electronic check transaction platform and just won’t take “pay up” for an answer.

All told, patent “reform” will in fact deform our nation’s intellectual property engine—and dull our competitive edge.

Obama administration Patent and Trademark Office Director David Kappos cut short his appearance before the House Judiciary Committee on this subject, stiffing lawmakers who had more questions.  The former IBM executive had to fly off to Europe.

Kappos gave a speech in London on patent harmonization.  The patent office director reportedly disparaged the American patent system.  He said it was “bizarre” that this country is stuck with what he called a 19th century model.

Many Diverse Opponents

In March, Kappos told an Asia-Pacific patent conference, “With the demands of a global marketplace, there is simply no excuse for our patent systems to stand as the lone remaining uncoordinated system in an otherwise highly fluid, global environment for exchange of all kinds.”

Many beg to differ.  Midsize and smaller U.S. companies, the venture capital sector, the U.S. Business and Industry Council, many universities, independent inventors, the major engineering society, Reagan Atty. Gen. Edwin Meese, a range of conservative organizations including Eagle Forum and others oppose the legislation.

In fact, most Americans may reach a conclusion different from that of the Kappos-Obama-Leahy-IBM “global harmonization” crowd.