TPA Signs Coalition Letter Rejecting Calls for Extension of CBM Program

Reforming the guidelines for our Patent system in the United States is one of the key goals that Taxpayers Protection Alliance has pressed Congress on for a number of years. Right now so called ‘patent trolls’ (instances in which patents are obtained purely for the purposes of clogging up the courts and making profit off that logjam) are harming innovation and competition. There are other components of reforming the patent system that are key to encouraging more investment and innovation into the economy and one relates to the Transitional Covered Business Method (CBM) Review Program. The CBM program “was created specifically to help financial services companies challenge a wave of low-quality patents (known as business method patents) issued prior to a Supreme Court decision that essentially ended the ability to get those patents.” The program was set up as a temporary one in 2012 and is set to expire in 2020, but now there are calls for extending it. TPA rejects that idea and signed a coalition letter to leadership in the House and Senate Judiciary Committees expressing opposition to any calls in Congress to extend CBM.

Read the letter below

June 3, 2015

Dear Messrs. Chairmen and Ranking Members:

We write to thank you for your leadership in advancing the health of our nation’s patent system and to share our perspectives regarding proposals to reform the system to deter litigation abuses while maintaining incentives to innovate.

Our Constitution empowers Congress “to promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.”  By these simple terms, the Constitution both recognizes the importance of the spark of creative genius to the future of the Nation and the importance of rewarding that genius with an exclusive property right.  In today’s knowledge-based economy, patents are more important than ever.  Patent rights encourage innovation by ensuring that inventors are able to exercise their patent rights, leverage those rights to attract capital essential for job creation and growth, and enforce their rights when necessary.  The cornerstone of the US patent system – and the key to its sustained ability to foster innovation across all areas of technology and sectors of the economy – has been its “unitary,” non-discriminatory treatment of all inventions.

With this foundational goal in mind, we  urge you to reject calls to prolong the Transitional Covered Business Method (CBM) Review Program established by sec. 18 of the America Invents Act.  The CBM program was intended as a temporary program to address a category of weak business method patents.  In the three years since the program was first implemented, the Supreme Court’s Alice decision has provided clearer rules for assessing sec. 101 challenges to business method patents in district court and other administrative review mechanisms at the USPTO are providing effective tools to challenge weak patents under programs and rules that do not discriminate against software innovation.

In our view, there is no justification for extending a discriminatory review procedure that prejudices software innovators at home and stands as a tempting and harmful precedent to be followed by other governments eager to erode protection for US innovators.  We believe the transitional CBM review program should be allowed to expire in 2020, as rightly intended by the AIA.

We appreciate the opportunity to share our views and look forward to working with you as balanced, litigation-focused patent reform moves forward.

Sincerely,

Phil Kerpen
President
American Commitment

Steve Pociask
President
American Consumer Institute Center for Citizen Research

Jeffrey Mazzella
President
Center for Individual Freedom

Thomas A. Schatz
President
Citizens Against Government Waste

Charles Sauer
President
Entrepreneurs for Growth

Karen Kerrigan
President
Small Business & Entrepreneurship Council

David Williams
President
Taxpayers Protection Alliance