According to the Wall Street Journal (link), President Obama has received a letter from 28 chief executives of leading US companies "urging him to support legislative efforts to overhaul the nation's patent system".
The desire to reform the US patent system is not new but it seems to be more and more critical (and desired) now that the US are in recession.
The aim of such reform would be to create better IP policies that can be used for creating (local) jobs.
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It came as no surprise that Senate Minority Whip Jon Kyl (R-AZ) (and apparently with a straight face) has recently introduced HIS Patent Reform Act (S610), a copycat of the Bill he proposed last September (S3600) in the wake of the failure of the other patent reform bill then pending in the Senate and contrary to (S515) and (HR1260) currently pending in Congress.
It again includes a "Check 21" exception (sec. 13,): "With respect to the use by a financial institution of a check collection system that constitutes an infringement under subsection (a) or (b) of section 271, the provisions of sections 281, 283, 284, and 285 shall not apply against the financial institution with respect to such a check collection system." Although a small Technology Company named Data Treasury and its patents were NOT specifically mentioned, the intent of the exception is aimed directly at Data Treasury and its ongoing litigation against the banking industry for infringing upon its "Check Collection" remote image capture technology.
Sen. Jeff Sessions originally sponsored this exception in the then pending reform bill, but he later withdrew his support expressing doubts about its legality. Kyl's proposal has one key difference from the one Sessions offered: It attempts to keep the federal government from shouldering any financial liability for blocking DataTreasury's pursuit of patent damages against the banks. Under Kyl's bill, the bank-immunity provision would be voided if a federal court found that the legislation amounted to a government "taking" of DataTreasury's patent rights. This exception, as written, pollutes a legitimate legislative effort with ex post facto and probably unconstitutional provisions having the lofty purpose of allowing banks infringing Data Treasury Patents to negate and or dramatically reduce the damages they face. So rather than face a jury, where they obviously fear losing, the banks decided to call on their friends in Congress for legal protection. So what was the purpose of his adding this exception with the Gov’t provision to the bill other than to protect the banking industry depicting a clear and crass example of who gets bought in Congress? Legislation should not be used to grant retroactive legal immunity to large corporations that willfully ignored the property rights of a small, innovative company. And no elected official who has pledged to maintain the integrity of our legal system should be a party to such a travesty. Senator Kyle by championing this exception should be made (with a clear answer devoid of spin) to explain why exactly, banks should be immune to patent law that applies to everybody else.
This is the Industry that Sen. Kyl Champions:
From: Chief executive (U.S.) 5/1/2002 –Author PRINCE, C.J.
“It’s not every CEO who freely admits to swiping other people’s ideas—although, truth be told, the vast majority of successful chief executives have probably taken the liberty. But ask Richard Kovacevich, CEO OF WELLS FARGO, whether he prefers inventing ideas or stealing them and he’s quick with his response. “Oh I would much rather steal an idea,” the 57-year old CEO says matter-of-factly. “Quite frankly, it’s much easier mentally. I have no pride about that.” Such disclosure was for the purpose of marketing new technology and while his comments may have been in another context, they clearly set a tone and standard for his senior executive’s actions over the ensuing years.
For years, DataTreasury Corp. tried to sell its technology to the banks, but instead of buying or licensing the technology, several big banks expropriated it and began using it to change the way they processed checks. DataTreasury's technology created a windfall for the banks. According to the industry's own experts, the banks save $20 to $40 billion annually because of the switch to digital processing. Of course, that switch would not have been possible without DataTreasury's technology, which was covered by patents that the banks callously ignored. Understandably, the company has sued for damages. The banks initially responded by trying to get the patents invalidated with some legal jujitsu. But the U.S. Patent and Trademark Office upheld the validity of DataTreasury's patents in their entirety. Since then, via ongoing litigation, the Data Treasury patents have withstood the best legal challenges the banks could buy, and that some of the more responsible banks have admitted the validity of the patents by licensing them. And every entity that has been sued almost surely had opportunity to negotiate a license before being sued. This exception has the backing of the Coalition for Patent Fairness, (Fairness by definition - freedom from dishonesty and injustice), a group of high-tech companies backed by (The Financial Round Table.) The Financial Round Table is an institution that represents the country's' one hundred largest banks. These banks have a serious financial problem. A finding of willful infringement, will subject them to treble damages. Are they trying to slide an, (unconstitutional) exception through in the name of (honesty and justice)?
It is abundantly clear that the Banking industry motivated by their unbridled power and greed are prepared to do whatever they believe is necessary to achieve their goals to avoid having to pay a reasonable royalty on Data treasury’s validated Patents. We are on very dangerous grounds with congressional tampering with the constitutional right of intellectual property protection. These are high-quality patents; to not enforce patent rights would be a discredit to those who fairly and lawfully use these licenses.
This letter appears to be a response to the letter sent on Feb. 10 2009 by a consortium of 135 U.S. manufacturers urging the President not to go forward with the proposed patent reform, which would in their view only benefit the major banks and hi-tech companies involved in numerous litigations(the very authors of the letter posted in the WSJ...)
You can find a copy of this letter here
I am not sure the changes made by the legislation will be a good thing. See what this article had to say: http://www.napsnet.com/articles/61068.html
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