Letter to David J. Kappos, Under Secretary of Commerce for Intellectual Property

Letter

Congressman Jim Sensenbrenner (R-WI) and Congresswoman Baldwin (D-WI), in a joint letter to David Kappos, Under Secretary of Commerce for Intellectual Property, urged the United States Patent and Trademark Office (USPTO) to consider small innovators and research universities in implementing expanded prior user rights as passed in recent patent reform legislation (H.R. 1249, the America Invents Act). Sensenbrenner and Baldwin strongly opposed the America Invents Act and the expansion of prior user rights under Section 5.

The America Invents Act's expansion of prior user rights gives new rights to those who have previously developed and used the same process or product, even if they never publicly divulged their innovation and never applied for a patent.

As required by the America Invents Act, the USPTO is conducting a study and collecting comments on the impact of prior user rights for small businesses, and held a public hearing on prior user rights and international patent protection this week.

"Expanding prior user rights could be disastrous for entrepreneurs, innovators and university researchers in Wisconsin and around the country," said Congresswoman Baldwin. "It rewards secrecy and creates a significant burden for small businesses and start-ups that seek to protect investments in innovation. Ultimately, I believe it will slow job creation," she added.

"The expansion of prior user rights rewards secrecy and challenges the foundation of our patent system, exclusivity," said Congressman Sensenbrenner. "As a result, investors will have no way of knowing the potential value of a patent, and research universities and small business innovators will face greater challenges to be successful. I hope the USPTO will carefully consider these stakeholders' input in order to minimize the negative impact on their ability to find capital, defend legitimate patents against litigation, and bring products to market," he said.

A full text of the letter to Under Secretary Kappos follows:

October 27, 2011

Honorable David J. Kappos
Under Secretary of Commerce for Intellectual Property
Director of the United States Patent and Trademark Office (USPTO)
P.O. Box 1450
600 Dulany Street
Arlington, VA 22313-1450

Dear Director Kappos:

We write regarding the report required from United States Patent and Trademark Office (USPTO) by Section 3(m) of the recently enacted America Invents Act (AIA) on the operation of prior user rights in selected countries in the industrialized world and on constitutional and legal issues in the United States associated with placing trade secret law in the patent law, among other purposes. We specifically request that the USPTO carry out the Section 3 study in a way that keeps the research and inventor communities involved and informed.

As you know, we opposed final passage of the AIA in part due to concerns that the expansion of prior user rights in Section 5 will undermine investor and innovator confidence and limit small business growth and job creation. We remain concerned that this change will stifle scientific progress at our leading universities -- resulting in diminished investment, fewer products being brought to market, greater threats of intellectual property theft, and increased litigation.

We were pleased to see that stakeholders had an opportunity to contribute to the Section 3 report through at least one public hearing this week, as well as a written comment period. We hope the USPTO will afford more opportunities for scientists, researchers, small inventors and those with concerns to formally provide comments on any draft study. In addition, we hope that you will generally develop the study in a manner that is transparent to the public. Indeed, innovators, researchers, and investors alike should be involved in the Section 3 study in a way that will familiarize the stakeholder community about any proposed expansion or narrowing of Section 5.

We support sound reforms to our patent system that will provide innovators and investors with greater confidence, address the inexcusable backlog of patent applications and foster small business innovation and investment. Unfortunately, we believe the expansion of prior user rights will be bad for researchers, small business innovators, and patent holders. For these reasons, we believe it all the more important to involve innovators, researchers, and investors in the study of prior user rights.

We thank you for your timely attention and look forward to hearing your thoughts regarding this request.

Sincerely,

Tammy Baldwin F. James Sensenbrenner, Jr.

Member of Congress Member of Congress

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