Vishal Amin, IP Czar Nominee
As Senior Counsel of the House Judiciary Committee, Vishal Amin was an architect of the Patent Trial and Appeal Board (PTAB), the administrative tribunal that has destroyed thousands of patents, destabilized the U.S. patent system, and sent venture capital and countless technology startups to China. Where does he stand now?
The Senate Must Vet Vishal Amin
US Inventor represents tens of thousands of inventors who create jobs by using U.S. patents to bring new ideas to existing companies, or to start their own. We are all suffering from the US Patent and Trademark Office (USPTO) implementation of Patent Trial & Appeal Board (PTAB) created under the America Invents Act (AIA). Vishal Amin was the primary architect of the AIA. President Trump has nominated Mr. Amin to serve as White House Intellectual Property Enforcement Coordinator, sometimes referred to as the “IP Czar”. US Inventor asks the Senate to consider the effects of the AIA in Mr. Amin’s confirmation process.
In the AIA, Congress granted the USPTO broad power in the PTAB to weed out those few patents that were granted but perhaps should not have been. However, largely due to PTAB, the U.S. patent system now ranks 10th in the world, tied with Hungary.
PTAB invalidates at least one claim in more than 95% of patents it reviews. Invalidating just one claim can destroy the patent. The cost of defending a single PTAB starts at $500,000 and burns five years of the patent’s life. Big corporations “gang tackle” inventors by filing multiple PTABs against the same patent, thus driving the cost of defending a patent into the millions of dollars. PTAB is obscenely unfair and damaging far beyond the patent’s value.
PTAB damages capitalization of our most important new technology startups – those with innovative new technologies that must be protected by patents. These are the very companies that have historically created most of our new jobs.
While we weaken our patent system, China strengthens its patent system. This is causing venture capital that once propelled startups here to move to China.  Along with that funding goes job creation and economic growth, but more importantly, the leading position in new technology creation on the world stage also goes, which is extremely damaging to our national security.
Changing PTAB rules may help for a while, but will not fix the PTAB’s systemic problems. PTAB rules will change with every new administration. While a patent’s term is 20 years, PTAB rules may very well change every four years. This leaves the patent system perpetually unstable and as such unable to drive economic growth and job creation because patents will never be able to attract investment for early stage startups.
Not surprisingly, PTAB is the most used patent litigation venue. Far more than the Eastern District of Texas. PTAB, an administrative tribunal, invalidates property rights without a jury and under completely different rules than an Article III court, which is in conflict with 220 years of black letter law, precedent and the U.S. Constitution.
Vishal Amin is an architect and the primary driver behind the AIA and the PTAB. He must explain his reasoning for the most damaging legislation to the patent system and American innovation in U.S. history. Unless he can reasonably explain his position on these issues, he must be assumed to be unqualified for the position of White House Intellectual Property Enforcement Coordinator.
Click here for PDF Vishal Amin Nomination_Final
In his first speech to Congress, President Donald J. Trump finished strong, talking about how inventors can make the American economy great again. You might expect that from a branding pioneer. His billions are built on intellectual property; the Trump Organization owns hundreds of trademarks around the world.
In fact, it’s a family legacy: his uncle John G. Trump‘s patented radar and cancer tumor laser inventions won recognition from Presidents Truman and Reagan. His son, Donald J. Trump Jr., has been a patent licensing investor and executive. Ivanka Trump has her own trademarks worldwide.
Even the Republican platform specifically states patents are private property – rights inventors rely upon to create jobs and bring new ideas to market. So, you might think a Trump White House would be as pro-patent as Trump Tower. But it’s not.
Read full article at Real Clear Politics.
Our U.S. patent system no longer encourages investment in new technologies.
Patents are now liabilities for inventors. Our USPTO discourages the creation of new technologies by enabling big corporations to crush startups and inventors.
Congress must act to stop this damage to our economic engine and the American Dream.
Eliminate the Patent Trial and Appeals Board (PTAB)
The PTAB is a tribunal within the U.S. Patent and Trademark Office (USPTO) that treats issued patents as a public right, not a property right. PTAB’s invalidate at least one claim in more than 95% of the ISSUED patents reviewed rendering most patents valueless for funding at an early stage. Invalidating just one claim can neuter the enforceability of the entire patent. Big corporations are filing multiple PTAB procedures on the same patent driving the cost of defending it into millions of dollars and scaring investors. The PTAB must be eliminated so patents can attract investment at early stages.
Eliminate the “Abstract Idea” Exception to Patentable Subject Matter
Supreme Court decisions changed the meaning of “patentable subject matter” by creating three exceptions to patentable subject matter: abstract ideas, natural phenomena, and laws of nature.
The abstract idea exception is creating chaos by failing to define what is or is not an abstract idea. Today what is patentable is completely in the eye of the beholder and often different branches of government come to different conclusions on the validity of the same patent.
Abstract idea exceptions mean patents have virtually no value in valuations of early stage startups.
Restore Injunctions and Injunctive Relief
Injunctive relief was the default judgment for infringement for over 200 years serving as a strong deterrent to patent infringement, and was the basis for projecting the future value of a patent at the earliest stages. Patents are critical to attracting investment to commercialize technology.
In 2006 a Supreme Court decision, eBay v. MercExchange effectively eliminated injunctive relief. Investors cannot project the future value of a patent, and as a result investment in patents has dropped. With the most powerful deterrent now removed, “efficient infringement” exists.
End Track I Examination in the USPTO
Track I examination was created to speed examination in exchange for additional fees. While marketed as a tool for small entities to get patent protection faster, most small entities cannot afford the higher fees. Big corporations can, and are the primary users of Track I examination.
Return to “First-to-Invent” from “First-to-File”
First-to-invent changing into a first-to-file system created the opportunity for unscrupulous people to steal inventions by filing for patent protection ahead of the actual inventor. Inventors must now file for patent protection as soon as possible before disclosing it to anyone to determine the invention’s viability, marketability or costs. This adds upfront costs for unproven inventions to the people least able to afford it. First-to-file is discouraging inventors to the point of abandoning the patent system.
While we have damaged our patent system, China has strengthened theirs. Today, China leads the world in new patent filings. Large amounts of venture capital that once fueled early stage startups in the U.S. have moved to China. As a result, startups are fleeing to China.
Congress must act to correct this damage to allow the U.S. to succeed in the modern innovative world.
(This article first appeared in IPWatchDog)
It would appear as if Obama holdover Michelle K. Lee continues to run the USPTO. More than six weeks after President Trump’s Inauguration Lee is delivering remarks at PPAC and PTAB Bar Association on March 2, 2017, appearing as a speaker at industry events (e.g. AUTM), signing notices published in the Federal Register, and signing newly issued U.S. Patents. This could be a very expensive problem for inventors as these patents end up in litigation and defense lawyers inevitably challenge the validity of any patent issued and signed by Lee because there is no clear authority for anyone to sign patents until an official announcement has been made on Lee’s statuts.
The lack of transparency surrounding Lee’s status is but one serious problem at the USPTO; there are others. Take for example the story of how the USPTO under Michelle Lee is pushing a fee increase. We first alerted the Patent Public Advisory Committee (PPAC) in an open letter outlining the problematic nature of the USPTO fee increase just ahead of the first quarterly meeting on March 2, 2017. A major issue is that fees for examination, where the USPTO creates patents, are being internally diverted to the PTAB, where the USPTO destroys patents. Yet, the USPTO wants to increase examination fees anyway, presumably so those fees can still be diverted to fund the financially failing PTAB. The PPAC accepted the letter and will soon publish it on their site.
The contents of our letter were not discussed at the most recent PPAC quarterly meeting, but it was acknowledged for receipt and it appears some PPAC members wanted to discuss it. However, during that meeting serious questions came to light about whether Lee’s USPTO is undermining President Trump ‘One-In Two-Out’ Executive Order.
President Trump’s ‘One-In Two-Out’ Order (formally Presidential Executive Order on Reducing Regulation and Controlling Regulatory Costs) mandates that whenever an executive department or agency publicly proposes for notice and comment or otherwise promulgates a new regulation, it shall identify at least two existing regulations to be repealed. Moreover, under the ‘One-In Two-Out’ Order, the costs of any new regulations must be offset by the elimination of existing costs of at least two prior regulations. The ‘One-In Two-Out’ Order broadly defines the term “regulation” or “rule” to mean “an agency statement of general or particular applicability and future effect designed to implement, interpret, or prescribe law or policy or to describe the procedure or practice requirements of an agency.”
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March 1st, 2017
US Inventor recently submitted an open letter to the Patent Public Advisory Committee (PPAC) at the USPTO. This letter is to inform PPAC of our concerns related to the proposed fee increase, USPTO transparency, and issues surrounding the PTAB including diversion of fees from examination to the PTAB.
US Inventor has signed onto a Brief in support of Petitioners Retractable Technologies, Inc. and Thomas J. Shaw.
INTERESTS OF AMICI CURIAE
Amici include nonprofit inventor clubs and individual inventors and entrepreneurs. The nonprofit inventor organizations represent over 20,000 inventors, startup owners and executives and others interested in their success. The amici have spent substantial portions of their lives inventing, building new companies and competing in new markets as well as educating and mentoring new inventors and entrepreneurs. They represent the driving force of the world’s most powerful economy. Amici’s extensive experience with the patent system, new technologies and starting up companies and the resulting ties to the health of the American economy make them well situated to explain the importance of the issues presented in this case.
Read the Brief in it’s entirety here