Rather than the patent system being the incentive for "so much of our innovation, it has become a constraint on innovation," said Rep. Howard Berman, D-Calif., author of a sweeping patent reform bill that passed the House Judiciary Committee on July 18.
The Senate Judiciary Committee passed similar legislation the following day. The full House could take up the issue before leaving for summer recess Friday, though it's more likely to be considered in the fall.
Disputes between the high-tech industry, drug companies and other interest groups have stalled patent reform attempts in the past, and legislation introduced during the last session of Congress never made it out of committee.
Patents give holders ownership rights to their inventions for 20 years. That can mean hundreds of millions of dollars to companies, research universities and individual inventors.
Although not everyone believes the patent system needs to be changed, critics cite various problems.
There's a backlog of 750,000 patent applications at the U.S. Patent and Trademark Office, which is recovering from years of underfunding and hopes to nearly double the number of patent examiners on staff, currently about 5,300.
Patent applications have shot up in recent decades with the boom in the high-tech industry, and they have gotten more complex. There's been a corresponding increase in patent infringement lawsuits, which the tech industry blames on so-called "patent trolls" who get patents for products they never plan to make, just so they can sue for infringement if a company does turn out something similar.
That was the issue in a May Supreme Court ruling in favor of eBay Inc. in a lawsuit by a small Virginia patent-holding company, MercExchange. The ruling established that judges have flexibility in deciding whether to issue court orders barring continued use of a technology after juries find a patent violation.
Tech companies still complain that under current law, damages in patent infringement lawsuits can be wildly excessive because they can be based on the value of an entire product, not just whatever small component of that product is in dispute.
Often cited is a $1.53 billion jury verdict earlier this year in favor of Alcatel-Lucent SA in a dispute against Microsoft Corp. over two patents for MP3 encoding and decoding tools.
"The current patent litigation system is unbalanced in a way that it forces our companies to spend more time in the courtroom and less time innovating," said Josh Ackil, vice president of government relations for the Information Technology Industry Council.
