Patent Reform Legislation Stymied by Damages Provision

According to Sarah Stirland writing for "Intellectual Property Watch" on September 29, 2005, the biggest remaining sticking point between the information technology industry and the biotechnology and pharmaceutical industries in the latest patent reform bill is its proposal to change the way courts award damages:

In testimony submitted to the House subcommittee, BSA’s Counsel Emery Simon
said that his group opposes the coalition’s proposal to change the legal language covering damages to cover “claimed inventions” rather than “inventive contributions.”

This change could allow patent holders to claim monetary damages based on the value of an entire new product, rather than the value of an inventor’s partial contribution to a product. But “we think the law is functioning well as it exists,” said Herb Wamsley, the Intellectual Property Owners Association’s executive director. “We have not seen any legal cases that demonstrate that the law doesn’t work. The proponents of ‘inventive contribution’ are trying to change the law in a way we don’t understand, but would appear to reduce the amount of patent damages and royalties than what we would have today,” he added.

While members of the House subcommittee earlier this month tried hard to bring industry representatives closer to consensus on the issue, it was clear that negotiations are going to be tough. BSA’s Simon warned legislators during his presentation to the subcommittee that “The support of our industry for this legislation should not be taken for granted.”