The White House has announced it strongly opposes the current version of the Patent Reform Act, which most likely will be voted on by the Senate later this month. A letter sent Monday to Senate Judiciary Committee members stated that the Bush administration favors some aspects of the bill but opposes the bill in its entirety unless a section on damage awards in patent infringement cases is “significantly revised.”
“We believe the resulting harm to a reasonably well-functioning U.S. intellectual property system would outweigh all the bill’s useful reforms,” stated the letter from Nathaniel Wienecke, the Commerce Department’s assistant secretary for legislative and intergovernmental affairs.
The damages language in the bill “would likely lead to less than adequate compensation for many patent holders and could promote infringement,” the letter stated. “The administration does not believe it advisable to create a statutory directive to courts that requires them to rigidly apply, in all cases, only one of the several broadly accepted factors now evaluated by the courts.”
Section 4 of S. 1145 sets some specific standards for federal courts on how to determine reasonable royalties in patent infringement cases, along with permitted grounds and limitations on damages for willful infringement.
Wienecke’s letter doesn’t say whether President George W. Bush will actually veto the bill if its current language isn’t revised.
Sens. Patrick Leahy (D-Vt.), chairman of the Senate Judiciary Committee, and Orrin Hatch (R-Utah), a committee member, issued a joint statement Tuesday responding to the letter. The committee passed the Patent Reform Act with amendments last July after it was introduced last April by Leahy with nine cosponsors.
“A critical piece of the Patent Reform Act addresses how courts determine damages for patent infringement,” the response stated. “Since its passage in committee, we have been working to strike the right balance to ensure patent holders obtain appropriate compensation in infringement cases. We have worked and will continue to work with the White House as the Senate prepares to consider this important legislation.”