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Berman: Moving The Meter on IP Laws

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If you ask U.S. Congressman Howard Berman about the task of representing North Hollywood — home of The Academy of Television Arts and Sciences — on Capitol Hill, he will tell you that it’s not a “glamorous job.”

Maybe not. But few House members’ campaigns can boast repeated financial backing from the likes of Steven Spielberg, Rob Reiner and Don Henley.

The California Democrat’s 25-year career in Congress has benefited more from the entertainment industry and its stars than from any other industry. Since 1989, his top contributors have been Time Warner, Walt Disney Co. and Vivendi.

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He has received far more funding from Beverly Hills 90210 — the neighborhood, not the TV show — than from any other zip code, according to Federal Election Commission data compiled by the Center for Responsive Politics.

As chairman of the committee that oversees the Internet and intellectual property, the Democratic Berman has led the charge to radically overhaul patent and copyright laws to account for globalization and digital technology.

The stakes are huge. They touch the financial interests of numerous industries, including IT, pharmaceutical, biotechnology, manufacturing, music and movies. Berman’s entertainment industry backers have remained largely on the sidelines in the patent reform debate, but they are front and center on copyright issues, and, at times in direct opposition to high tech.

The Path to Patent Reform

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Since taking the helm of the House Judiciary Committee’s Subcommittee on Courts, the Internet and Intellectual Property when the Democrats won the House last year, Berman has accomplished more to advance patent reform legislation than any lawmaker in the past 50 years.

In a bipartisan vote in September, the House of Representatives passed a sweeping reform bill that seeks to improve the quality of patents and discourage lengthy, expensive and sometimes frivolous litigation. The legislation would make it harder to secure patents and create easier ways to challenge them.

Although the legislation looks iffy on the Senate side, all sides agree that reform is needed after the House passed a version of the bill in the fall, as InternetNews.com reported.

Major patent reform legislation has been bandied about on Capitol Hill for the past three Congresses but never made it to the House or Senate floor for a vote. Rep. Lamar Smith, R-Texas, who chaired the subcommittee when the Republicans controlled Congress, worked closely with Berman to try to move the legislation in the last Congress.

“We laid the foundation “for the patent reform bill vote]. It’s to Howard’s credit that we were able to push the bill across the line,” Smith said. “I think Howard has a very constructive approach to legislation. He would rather improve it than kill it, and I think that’s a way to influence legislation and a way to advance the interests that you have.”

Compromise is necessary to secure legislation that attracts opposing camps as powerful as those concerned about patent law. Fighting hardest for the reforms are the major IT companies, including Microsoft, Apple, Cisco, eBay, Google, Intel and Palm, which maintain that the current patent system too frequently subjects them to protracted, expensive lawsuits and discourages innovation. Opposing them are the pharmaceutical, biotechnology and manufacturing industries as well as individual inventors and some technologies companies. They argue that the changes sought would make it too easy to infringe patents without consequences.

“Howard has a very constructive approach to legislation. He would rather improve it than kill it.”

Berman is often touted as a gifted negotiator and coalition builder, but, in his view, these penchants are simply a means of getting things done.

“I think that getting the things passed I’d like to see passed and defeating the things I’d like to see defeated are more easily done when you can put together a bipartisan coalition,” he said .

Berman recalled that his interest in patent reform was first sparked when some friends who are patent lawyers in Los Angeles explained that patents were being awarded for things that didn’t merit them, including business methods and the centuries-old notion of a reverse auction.

“This was not the case of some lobbyist coming to us with a bill,” Berman said. “It was people I respected, who had no personal stake but a great deal of expertise, telling me we needed to do reform. Some of their clients hate my bill.”

Plenty of people still hate the bill, and despite Berman’s considerable achievement in seeing it through to passage by the House, patent reform appears to be mired down yet again. The Senate Committee on the Judiciary approved legislation similar to the House bill in January, but the legislation is not currently on the Senate calendar.

One of the most hotly contested provisions involves a revision to the methods used by courts to calculate monetary awards for holders of infringed patents. The bill gives judges the discretion to determine damages by assessing the value of a component within a product that was infringed, rather than the value of the full product.

Another controversial provision would give priority to the first person to file a patent rather than the first person proven to be the inventor, which small companies and the biotechnology industry argue would favor large companies with large legal departments.

A third provision under contention would make it easier to challenge patents without going to court by allowing the Patent and Trademark Office to review patents after they’ve been granted — so-called “post-grant review.”

When Berman first began working on patent reform several years ago, he was surprised at how strong the passions were for these arcane matters of “apportionment of damages,” “post-grant review,” and “defense of inequitable conduct,” he said, adding that it quickly became clear that a bipartisan effort would be needed to advance the initiative.

“These are not issues which you could keep any substantial percentage of your constituency awake to listen to, but there are very strong feelings about them,” he said. “We knew that there was a great deal of sympathy for [reform] in certain parts of the high tech community and certain parts of the financial community, and there were concerns about it from some old-line companies and pharmaceutical companies.”

Ongoing concerns may well be enough to postpone patent reform until the next Congress convenes. The House and Senate are scheduled for recess most of August, and, with the election season looming, will likely adjourn toward the end of September.

Next Page: The path to patent reform

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