I have today signed H.R. 6933, a bill which makes several major reforms in the patent and trademark system.
One of my administration's major concerns has been the role of industrial innovation in promoting this Nation's economic health. More than 2 1/2 years ago, I initiated a review of industrial innovation to identify ways in which the Federal Government could improve the innovation process. We were assisted by hundreds of individuals from private industry, organized labor, the universities, and public interest groups.
As a result of these efforts, in October of 1979 I sent to the Congress an industrial innovation message proposing initiatives in nine critical areas relevant to innovation, including legislation to strengthen our patent system. I am pleased to sign this bill, which embodies many of my proposals.
We have already taken other steps to revitalize our patent system, including the application of modern methods of management and computer technology in the Patent and Trademark Office.
The legislation I am signing today does not eliminate all the problems we identified. It does not establish a comprehensive governmentwide policy for the allocation of rights in inventions made with Federal support. This legislation leaves in place the existing, often inconsistent array of statutory and nonstatutory patent policies governing individual agencies. Also left uncovered are large business contractors who perform more than 90 percent of the government's research and development work.
I am persuaded, however, that the present package of reforms goes far toward strengthening the effectiveness of the patent incentive in stimulating innovation in the United States.
The patent reexamination procedures established by this legislation constitute the most significant improvement in our patent laws in more than a century. Under these procedures, during the life of an issued patent any interested person—for example, a patent owner, a potential licensee, or a competitor—may obtain a prompt and relatively inexpensive reevaluation of its validity by the Patent and Trademark Office. Patent reexamination will make it possible to focus extra attention on the most commercially significant patents. This legislation will improve the reliability of reexamined patents, thereby reducing the costs and uncertainties of testing patent validity in the courts. The provisions of this legislation will result in less cost to the public for patent reexamination.
This legislation also authorizes the Commissioner of Patents and Trademarks to set fees at levels that recover a greater portion of the Office's operating costs. A new system of fees for maintaining patents in force will further shift some of the burden of supporting the patent system away from the public to the commercial users of inventions. This feature will be helpful to small businesses and individual inventors by keeping initial patent fees low.
In the area of Government patent policy, this legislation enables small businesses and nonprofit organizations to obtain title to inventions made with Federal support. I hope that this measure will benefit the public in some measure by making the fruits of federally supported research and development more widely available. While I regret that it was not possible to enact comprehensive legislation, I am pleased with the progress we have made.
The enactment of this legislation promises some real benefits to the Nation's economic health by stimulating our people's innovative activity. It now becomes the responsibility of the Government and industry to work together to realize that promise.