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Compromise Lets House Start Patent-Bill Debate Compromise Lets House Start Patent-Bill Debate

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Compromise Lets House Start Patent-Bill Debate

A compromise over sweeping patent-reform legislation has cleared the way for floor debate in the House on Wednesday, but the White House  expressed skepticism on Tuesday about how well the fix would work.

The bill, called the America Invents Act, has been held up because of a dispute over so-called fee diversion, in which Congress takes fees collected by the Patent and Trademark Office and allocates the money for unrelated programs.


House Judiciary Chairman Lamar Smith, R-Texas, the bill’s sponsor, offered a manager's amendment creating a fund for excess fees. Congress could use it to appropriate money back to the patent office. The amendment may be acceptable to conservative appropriators because it allows Congress to control the money while requiring the funds to go to the patent office.

House SpeakerJohn Boehner, R-Ohio, and House Majority Leader Eric Cantor, R-Va., joined some major tech companies, including IBM, in supporting Smith’s proposal. But the White House balked.

"The USPTO must be able to use all the fees it collects to serve the users who pay those fees," the Office of Management and Budget said in a statement.


"In this light, the administration is concerned that Section 22 of the manager's amendment to H.R. 1249 does not by itself ensure such access. The administration looks forward to working with Congress to provide additional direction that makes clear that the USPTO will have timely access to all of the fees collected, subject to the congressional oversight provisions in the bill."

Smith says that the proposed changes would preserve all PTO fees for the agency.

“After six years of working towards patent reform, we are near the finish line,” Smith said in a statement. “The new language negotiated by the Judiciary and Appropriations committees ends fee diversion by creating a fund for fees collected by the PTO.  The money in the fund will be reserved for and used by the PTO and only the PTO.  This maintains congressional oversight, while making sure that fees collected by the PTO can no longer be diverted to other federal programs by appropriators.” 

If the House passes the bill, differences will need to be worked out with the Senate, which passed its version of patent legislation in a 95-5 vote in March.


House Minority Whip Steny Hoyer, D-Md., expressed optimism that the compromise would gather support. “As a former appropriator, I am appreciative of the concept assuring that there is oversight of the appropriations and expenditures,” Hoyer told reporters.

The White House likes the bill otherwise.

"The bill represents a balanced and well-crafted effort to enhance the services to patent applicants and America’s innovators provided by the United States Patent and Trademark Office," OMB said.

"It does so by supporting the USPTO’s efforts to improve patent quality and reduce the backlog of patent applications, reducing domestic and global patenting costs for U.S. companies, providing greater certainty with respect to patent rights, and offering effective administrative alternatives to costly and complex litigation."

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