WASHINGTON (5/16/12)--The Credit Union National Association, the Financial Services Roundtable, and other financial services groups are largely supportive of the U.S. Patent Office's proposed patent law changes, but the patent proposal could also use some additional tweaks, Eliot D. Williams of Baker Botts L.L.P., will tell members of the U.S. Congress today.
Williams is scheduled to testify at a House Judiciary Committee hearing on implementation of the America Invents Act. U.S. Patent and Trademark Office Director David Kappos, Eli Lilly and Company General Counsel Robert Armitage, General Electric Chief Intellectual Property Counsel Carl Horton, 3M Chief Intellectual Property Counsel Kevin Rhodes, University of Michigan Associate General Counsel Richard Brandon, and Business Software Alliance Director of Government Relations Timothy Molino are also slated to testify.
The America Invents aims to protect businesses, including credit unions, from outside claims on some of their specific customer service, payment and marketing practices. It was signed into law by last September.
Outside patent claims, which are often brought by non-practicing entities, can become expensive for credit unions and others if they are end up in court.
In his testimony, Williams is expected to address section 18 of the new law, which creates a transitional program for review of business method patents.
"The importance of the transitional review program cannot be overstated," as the review program "offers a less-costly and more efficient alternative to litigation, so that businesses acting in good faith do not have to spend the millions of dollars it costs to litigate a business method patent of questionable validity," Williams' prepared testimony says. The review process allows the patentholder and patent challenger to make their own arguments, it adds.
However, Williams will suggest fees associated with the business method review program could be revised to ensure the program is "broadly accessible" to both large and small entities against whom covered business method patents are asserted. Accordingly, the fee should be reduced in instances where the petition is filed by a small (or micro) entity.
The current fee structure "may enable owners of business method patents to extract settlements from small entities using a settlement value based on avoiding the cost of filing a business method review which, in the case of patents with numerous claims, may exceed $100,000 -- even if the review is not ultimately granted," Williams will warn.
Williams will recommend that a staged fee structure could be used, imposing an initial fee due at the filing of a petition for business method review, and a subsequent fee due if the review is instituted.
Williams' testimonyt also represents the American Bankers Association (ABA), the American Insurance Association (AIA), the Independent Community Bankers of America (ICBA), NACHA – The Electronic Payments Association, and the National Association of Federal Credit Unions are also noted in his testimony.
Williams also suggested some technical changes and changes to definitions in the rule be added.
For more on the hearing, use the resource link.
WASHINGTON (5/16/12)--The National Flood Insurance Program (NFIP) would be extended until June 30 under legislation that is expected to be offered by Rep. Judy Biggert (R-Ill.) today.
The NFIP is scheduled to lapse on May 31.
In the past the program has lapsed for brief periods--three times in 2010, and CUNA has noted that these lapses have caused significant disruption in the mortgage underwriting process for thousands of prospective homeowners.
The Credit Union National Association (CUNA) has urged members of the U.S. Congress to extend the NFIP or reform the program, as credit unions and other lenders cannot write certain mortgages without NFIP coverage. CUNA also recently joined a coalition of associations representing homebuilders, the insurance industry, other financial institutions, brokers, and others to ask Congress to act on NFIP issues.
Comprehensive NFIP reform has not been agreed to in the House or Senate, but many Democrats and Republicans have said the NFIP is in need of reform, and other bills that would extend the NFIP and make some changes have been offered.
On the Senate side, S. 2344, which would extend the NFIP through the end of this year, was introduced recently by Sen. David Vitter (R-La.). Vitter has said he would offer the bill as a potential floor amendment.
Legislation that would extend the NFIP for five years has also been approved in the House and by the Senate Banking Committee.