(en) CPT on HR 400, Patent and Trademark Office Legislation

Ewald (ewald@ctaz.com)
Thu, 17 Apr 1997 01:15:52 -0700

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------- Forwarded Message Follows ------- Date: Wed, 16 Apr 1997 12:12:33 -0400 (EDT) Reply-to: love@tap.org From: James Love <love@tap.org> To: Multiple recipients of list <info-policy-notes> Subject: CPT on HR 400, Patent and Trademark Office Legislation

----------------------------------------------------------------- Info-Policy-Notes - A newsletter available from listproc@tap.org ----------------------------------------------------------------- INFORMATION POLICY NOTES April 16, 1997

This is the note we sent out today on HR 400, the bill that would turn the U.S. Patent and Trademark Office (PTO) into a government owned corporation, that would be privately funded. The bill would make a number of controverisal changes in patent laws, and the committee report on the bill contains a special interest provision for private database vendors, directing the PTO to continue its controversial policy of limiting online access to the full text of patents to a handful of fee based terminals at the PTO and selected libraries. We oppose the transfer of the PTO to the corporate entity (the privatization proposal) and the special interest provisions on access to patent information. We also oppose a section of the bill on prior user rights. James Love

Consumer Project on Technology P.O. Box 19367, Washington, DC 20036 http://www.cptech.org; 202.387.8030

Re: HR 400 Date: April 16, 1997 FMI: James Love, 202.387.8030, love@tap.org

This letter expresses our opposition to HR 400. We are opposed to the provisions regarding prior user rights, the creation of a private corporation to manage the granting of patents and trademarks, and the limitation of public access to patent data on the Internet.

Prior User Rights

Today, inventions can be protected as trade secrets or patents, but not both. There is a natural tension between the two forms of protection. The patent grants a legal monopoly on the invention, but only for a limited period, and after public disclosure. Trade secret protection can last as long as the secret is kept, but the holder of the trade secret runs the risk of independent invention, and the granting of a patent to a rival. This provides incentives for firms to seek protection under patent laws, which benefit the public interest through disclosure of the invention, and a limit on the period of the monopoly. HR 400 seeks to change existing law by granting the owners of trade secrets a royalty-free license to patents, if they can demonstrate they had used the invention in commerce, or for certain non-profit uses. This will have the predictable effect of encouraging firms to eschew patents, by reducing the risks associated with a trade secret. We oppose this change in the law, on the grounds that the public interest is better served by patents, than trade secrets.

Creation of a Private Corporation to Manage Granting of Patents and Trademarks

The federal government's authority to grant patents is found in the U.S. Constitution. The PTO's functions are a core government purpose. The PTO issues legal monopolies on a wide range of activities. Patents are issued on new life forms, surgical procedures (last year the Congress limited patent holder rights in this area), business practices (including marketing of credit cards and bond instruments), the use of human gene sequences, and many other areas of controversy. It is completely inappropriate for such decisions to be made by a private corporation. Private corporations should not create legal entitlements, and it is inappropriate for private corporations to fund specific policy initiatives for the PTO, which would increase control the agency's agenda and policy conclusions.

Provisions Limiting Public access to Patent Data on the Internet.

The Committee Report on HR 400 provides very bad language concerning the dissemination of patent information on the Internet. The PTO is directed to continue providing only a fee based system for access to the full text of patents, which is available only at the PTO and a handful of selected depository libraries. The PTO is instructed to "proceed with caution before creating any direct-to- end-user retail services because they could undercut the value of the bulk dissemination program and the value of patent information products and services now sold. This is an outrageous special interest provision, inserted by lobbyists for a coalition of commercial patent vendors (many of which are foreign owned, such West Publishing and Lexis). The purpose of the patent system is to trade a legal monopoly for disclosure of the invention to the public. At present commercial prices for these documents are so high that access to the full text of patents is largely limited to the patent bar, and large corporate entities. American students, small businesses and inventors should have free access to full text of patents on the Web. Decisions about the disclosure also should not be left to the patent holders themselves, since disclosure is a core obligation in return for receiving the legal monopoly. The public has been seeking Internet access to the full text of patents since 1991.


INFORMATION POLICY NOTES is a newsletter sponsored by the Consumer Project on Technology (CPT), a project of Ralph Nader's Center for Study of Responsive Law. The LISTPROC services are provide by Essential Information. Archives of Info-Policy-Notes are available from http://www.essential.org/listproc/info-policy-notes/ (no period). CPT's Web page is http://www.cptech.org (no period). CPT can both be reached off the net at P.O. Box 19367, Washington, DC 20036, Voice: 202/387-8030; Fax: 202/234-5176. Subscription requests to listproc@tap.org with the message: subscribe info-policy-notes Jane Doe


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