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Patent measure causing concern among independent inventors

Legislation headed to the Senate would alter the system to favor the person first to file instead of first to create. Some fear it could lead give big firms an advantage.

July 11, 2011|By Cyndia Zwahlen
  • Minna Ha, who has applied for a patent for a cosmetic case designed to hold makeup refills, worries about how the proposed legislation would affect the process. "It does add to the anxiety, she said.
Minna Ha, who has applied for a patent for a cosmetic case designed to hold… (Glenn Koenig, Los Angeles…)

A bill making its way through Congress calls for a significant change in the way patents are awarded. It would switch the U.S. from a system that favors the first person to invent an item or process to one that would instead give preference to the first person to file for the patent.

It's a change that has independent inventors worried that it would make the process more complicated and expensive, and thus give an advantage to large firms.

"It does add to the anxiety, it does make it feel like more of a race" to the patent office, said Minna Ha of Arcadia, who has a patent application pending for a cosmetic case designed to hold makeup refills. "What will make a big difference at that point will be the resources available."

The bill, known as the Leahy-Smith America Invents Act, has passed the House and is now in the Senate for consideration. The Senate passed its own first-to-file bill earlier this year, but momentum seems to be behind the House version.

The switch would align the U.S. with patent laws in Europe and Japan, which is one of the reasons that global companies support the change. They also say it would cut down on costly legal battles over patent rights.

Some small-business executives say there are merits to the switch.

"It adds clarity to the system," said Scott Dunbar, patent counsel at Second Sight Medical Products Inc., an 89-person company in Sylmar that is developing implantable retinal prosthetics. "If things are very cut and dried it helps everybody assess the situation and reduce costs."

But George White, a licensed patent agent who prepares and files patent applications, said the first-to-invent system is a better fit for independent inventors.

"The first person to invent it should be the one to profit from it — that is kind of an American feeling, and it kind of feels like it favors the little guy," said White, who is president of the nonprofit Inventors Forum in Orange County.

The added expenses could come, in part, from multiple filings as inventors seek to protect each step of their progress. The cost — in money and time — of making many filings could discourage independent inventors from taking risks inherent in the process, said Roeben Terzian, a veteran toy inventor.

"Risk-taking is very important in our economy because it's the risk-takers that create the small businesses and the small companies," said Terzian, who is chairman of OHC Group in Westlake Village, which that designs and sells dolls. "Let's face it, Mattel at one time was a husband-and-wife team."

The first-to-file system could also make it harder for an inventor to show a product to a potential customer or investor before committing resources for a patent, said attorney Yar Chaikovsky, who specializes in patent litigation.

The inventor would have to get the person seeing the invention to sign a nondisclosure agreement, he said.

"The problem you've got is, if you don't get someone to sign, if they go use it, you're dead," said Chaikovsky, who is with the firm McDermott Will & Emery in Menlo Park.

Inventor Chris Pegula, who designs and sells diaper bags for men (his products include messenger and laptop bags) as chief executive of Diaper Dude in Los Angeles, is concerned that new regulations could add more complexity to what is already a complex process.

"It's a struggle to have enough funds to go to market," Pegula said, "My biggest thing is I just want to be able to go to market without somebody saying I am infringing on their product."

smallbiz@latimes.com

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