Patent Bill Would Aid "Micro" Firms
The latest version of a bill designed to reform the nation's patent system includes a provision designed to aid the truly small inventor.
The bill, which is scheduled for potential changes and a vote by the Senate Judiciary Committee on Thursday morning, includes a definition for "micro entity" status. The language was added in a version of the bill submitted by panel Chairman Patrick Leahy of Vermont on June 21. It was adopted by unanimous consent.
Currently, the two statutes for patent applicants are for small and large entities, but the Patent and Trademark Office and others had expressed concern that hobbyists or tiny start-ups would be discouraged by the current patent application fee structure and related issues. Small entities, under current regulations, are businesses employing fewer than 500 employees.
The most recent version of the bill dubs a business a micro entity if it has fewer than five employees and has a gross annual income of no more than $100,000. The micro entity also cannot have been named on five or more previously filed patent applications. A firm can not consider itself a micro entity if it already has agreed to turn around and sell or license an invention to a large firm. However, the bill would enable a micro entity to turn around and sell its wares to another micro entity.
The "small business" definition, which gives a 50 percent reduction on patent fees, includes universities. Micro entities also would be able to receive the discount. By defining this category, lawmakers hope to take the "first step towards addressing the needs and concerns particular to those inventors," according to a summary of the bill from the Judiciary panel.
"There are a number of universities that are applying for hundreds of patents every year...and they may actually be bringing in more money off their patents than their athletics programs," said Jefferson Taylor, director of congressional relations at PTO. "This takes and puts the little guy -- the garage inventor -- in a different category."
Taylor said the PTO is "very happy" with the Senate bill and the PTO has "high hopes [the bill] will move on."
The PTO has been pressing that a patent modernization bill include a micro entity provision for years.
The Commerce Department, which oversees the PTO, had requested that the bill include a special category addressing very small businesses or inventors in a May 16 letter to Rep. Howard Berman, the California Democrat who chairs the House Judiciary subcommittee overseeing courts, the Internet and intellectual property issues. The House version of the patent modernization bill mirrors the Senate version.
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