PTO Nominee Supports Patent Reform

Not many presidential nominees come with the public record of David J. Kappos, President Obama's pick to serve as the next director of the U.S. Patent and Trademark Office. But Kappos, currently serving as IBM's vice president and assistant general counsel for intellectual property law, is a familiar face for Washington lawmakers.

If confirmed, as expected, Kappos will be stepping into the one of the most contentious legislative battles before Congress: patent reform. For the last six years, high-tech companies have been battling with big pharmaceuticals and traditional manufacturing over a number of patent issues, particularly over willful infringement rewards.

The technology industry favors narrowing the damages, while big pharma favors the current system, fearing diluted damages will hurt the value of patent portfolios.

In the 110th Congress, the House approved patent reform favored by tech that would limit damages in relation to the economic value of the patent's contribution to an overall product, but the legislation never gained traction in the Senate. Currently, infringement damages are based on the entire value of the product.

In the current Congress, the Senate Judiciary Committee voted 15-4 in April for a compromise bill that seeks to bridge the longstanding dispute between technology companies and the pharmaceutical industry over patent infringement damages. The bill, though, has stalled.

"A particular point of contention has been and remains the appropriate standard for reasonable royalty damages determination," Kappos testified in March before the Senate Judiciary Committee. "As with other issues with competing interests that have been resolved, IBM believes that this issue is reconcilable and a balanced solution can be achieved."

Kappos also said he supports the patent reform bill approved by the Senate Judiciary Committee.

"IBM supports [the bill's] approach to improving patent quality," Kappos said. "While progress has been made in recent years through judicial reform in areas such as obviousness, injunctions, willfulness and most recently venue in patent litigation, much remains to be done to restore balance to our patent system."