Patent Reform Encourages Invention and Protects Ideas

Few issues are as important to the economic strength of the United States as our ability to create and protect intellectual property. American IP industries account for over half of all U.S. exports, represent 40 percent of the country's economic growth and employ 18 million Americans. A recent study valued U.S. intellectual property at $5 trillion dollars - or about half of the U.S. Gross Domestic Product.

Whether it's a mouse trap in your home or iPod in your hand, intellectual property plays a critical role in both our day-to-day lives and the global economy. Patents protect intellectual property and preserve the financial and competitive incentives that often drive invention.

While IP industries have soared, patent law has remained virtually unchanged since the 1950s. The Patent Reform Act of 2007 updates current law to better protect intellectual property, enhance patent quality and increase public confidence in the integrity of patents.

Specifically, the Act addresses two significant problems with the system.

First, because of the rapidly expanding fields of technology, too many patents of questionable integrity have been approved. The new law creates a post-grant opposition system to weed out bad patents.

Second, holders of these weak patents discovered a novel way to make money with their inventions -- not by commercializing and selling the products -- but by suing manufacturing companies whose operations might incorporate the patents.

The result is legalized extortion with companies forced to pay huge sums of money to use suspect patents. This new legislation eliminates legal gamesmanship from the current system that rewards lawsuit abuses over creativity.

Contrary to critics' claims, the bill does not favor the interests of certain groups over others. Rather, it corrects glaring inequities that are encouraging individuals to be less inventive and more litigious.

Patents are critical to protecting the rights of inventors and preserving the strength of the American economy. Abraham Lincoln, himself a patent owner, described the patent system as adding "the fuel of interest to the fire of genius."

The Patent Reform Act of 2007 ensures that the fires of genius that drive the American economy continue to burn bright.