The America Invents Act

The Leahy-Smith America Invents Act (AIA), which reforms the US patent system, was signed into law back in September 2011 and will bring about significant changes starting this coming March. The AIA was described by the New York Times as "a sweeping reform...that changes the system for determining priority for inventions at the patent office and provides more financing for an agency beset by application backlogs and outdated computer systems."

The White House press release identifies the following key features of the AIA:

• a fast-track option for patent processing within 12 months
• reducing the current patent backlog
• reducing litigation
• increasing patent quality
• increasing the ability of American inventors to protect their intellectual property abroad.

The verdict of The Economist on the AIA was: "Congress tweaks, but not overhauls, America's patent system". For instance, the writer points out: "Those who think that patents are granted too easily complain that the bill will still allow too many suits, especially those by “non-practising entities”, which are also known derisively as “patent trolls”." Also, the AIA didn't do away with all business-method patent applications (which seek, as the name suggests, to patent a method to do business) - only those related to finance. More worryingly, the bill doesn't seem to help with the PTO's funding situation.

John Villasenor, a UCLA professor in electrical engineering and a nonresident senior fellow at the Brookings Institution summarizes the AIA as follows:

1. Starting mid-March 2013, the "first to invent" patent system will be replaced by "first to file", which is more in line with the practice in the rest of the world. (This change has been met with some criticism, though, as it is said to put small companies at a disadvantage.)
2. A new prioritized patent examination program called Track One has been implemented, in which inventors can have their patent applications be processed within a year by paying an additional fee.
3. Companies will have more options to challenge their competitors' patents (granted or pending), from a “post-grant review”, which will allow them to challenge a patent issued within the previous nine months, to a “pre-issuance submission” option - starting in September 2012 - with which they'll be able to explain to the Patent and Trademark Office why they feel a competitor’s pending patent shouldn't be granted, among other procedures.
4. The AIA includes a defense to infringement based on prior user rights, which will help companies that were using as trade secret something later patented independently by a competitor. (Villasenor covers this topic in more depth in another post.)
5. The requirement for an inventor to disclose the "best mode" to use his patent is still in effect to obtain a patent but the sanctions that punished the failure to do so have been removed.

If you're curious about the fees the US Patent and Trademark Office charges to process patent application (you know you are!), this schedule has all the information for you. For instance, a request for prioritized examination will cost $4,800 while the most expensive item I saw on the list was the "request for inter partes reexamination", at $8,800.

According to an article in the New York Times, the new law has created strong demand for patent specialists, who typically have a dual background in engineering and law. I've seen some of my MIT doctoral classmates move on to law firms after graduation to work in intellectual property while taking evening classes toward their JD (although a JD is not required for patent law, which requires admission in front of the USPTO rather than the patent bar). It seems a very worthwhile career path that allows science and engineering PhDs to help support US innovation and entrepreneurship through the protection of intellectual property.

It's also worth reading to the remarks of the USPTO Director David Kappos at the Rensselaer Polytechnic Institute Venture Summit last April. The speech - very well-written - offers a good balance between concrete examples (including RPI's Emerging Ventures Ecosystems) and general statements about the policies of the current Administration on innovation, such as public-private partnerships, the handling of software-related inventions, and Institutes for Manufacturing Innovation.

I'll finish with an unusual example of innovation. Typically, universities are associated to the idea of innovation through their research labs, which involve mostly faculty and doctoral students. But George Washington University is injecting innovation in its own processes too, investigating ideas suggested by the GWU community, such as an increase in the number of hybrid courses - courses that combine on-campus class meetings with online learning activities - and better housing utilization to increase occupancy in the summer. GWU has showed its commitment to the experiment by identifying over $43M to be spent for Fiscal Year 2015 and each year thereafter on implementing these ideas. I find it a fascinating way to demonstrate the innovative process to students, from concept to implementation. Can't wait to see which ideas make it to real life!