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Small firms speak out on US patent law

Small firms speak out on US patent law

On 29 March, the US small business community took the floor of the House to criticise what it regards as restrictive patent laws. Set up to examine all aspects of US law in relation to smaller enterprises, the House Small Businesses Committee dedicated the day to patent legislation, airing some trenchant views on the subject.

Key speaker Mitchell Gross – head of New York-based software firm, Mobius Management Systems – said: ‘I am here to stress the fact that the US patent system is broken and needs to be fixed,’ adding that the patent approval process is ‘too expensive, takes too long and poses too much risk [of] an overly broad patent.’

On the question of large technology firms consistently railing against laws that allow smaller competitors to sit on patents without putting them to use – aiming instead to extract licensing fees or settlements from their economic rivals – Gross took an opposing view.

He claimed that smaller technology firms had grown so fearful of the risks inherent in lawsuits with the majors – from hefty payouts to the mere perception of infringement – that their innovation processes had stagnated. ‘The system is so tilted to the patentee's advantage,’ he said, ‘that defendants are forced to settle, regardless of the merits of their defense or the weakness of the patent.’

However, Ronald Riley, Michigan-based president of the Professional Inventors Alliance, said that patent problems in the US were not down to flawed legislation, but to the continued backlog of applications at the USPTO. He claims that an extra 15,000 staff are required to clear up the backlog – but that is double the USPTO’s current figure for planned staff expansion.

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