Karl Herchenroeder

Bipartisan legislation scheduled for House Judiciary Committee markup Wednesday would upend centuries of U.S. antitrust law and harm consumers, industry groups said this week. Antitrust Subcommittee ranking member Ken Buck, R-Colo., urged Republicans to come together and hold Big Tech accountable. Senate Antitrust Subcommittee ranking member Mike Lee, R-Utah, accused House progressives of taking advantage of conservatives’ “justified anger” against Silicon Valley.

Senate Intellectual Property Subcommittee Chairman Patrick Leahy, D-Vt., expressed confidence in the Patent and Trademark Office and the Patent Trial and Appeal Board at a subcommittee hearing Tuesday, a day after a key Supreme Court decision (see 2106210036). Leahy said he respects the U.S. v. Arthrex ruling and has confidence the PTO and PTAB will carry out their duties for the Leahy-Smith America Invents Act. The law shifted the U.S. from a first-to-invent system to a first-to-file system. Leahy said Congress must continue to address patent quality issues on the front end. A strong patent system that protects American inventions is critical to economic success, job creation and global competitiveness, said ranking member Thom Tillis, R-N.C. Tillis suggested Congress should consider creating a “gold-plated” patent with a more rigorous, more costly examination process to ensure patents are truly innovative and the innovation is “virtually impossible” to challenge. To improve patent quality, University of Utah law professor Jorge Contreras suggested Congress increase PTO “vigilance to detect potentially inoperable inventions,” heighten examination requirements, allow more public input and increase penalties for fraud. “Strong patents encourage and protect innovation, and are critical to our overall economy,” said Acushnet Company Vice President-Patents Troy Lester. “Overly broad patents, in contrast, are detrimental to U.S. manufacturing companies, often stifling innovation.” Instead of wasting “resources of our nation’s industries on low quality patents, we need to implement ways to improve patent quality on the front end,” said Cree Chief IP Counsel Julio Garceran.

Patent Trial and Appeal Board judges are unconstitutionally appointed, and granting the Patent and Trademark Office director more discretion to review PTAB decisions would cure the problem, the Supreme Court ruled Monday in U.S. v. Arthrex (19-1434). The Constitution “forbids the enforcement of statutory restrictions on the Director that insulate the decisions of [administrative patent judges] APJs from his direction and supervision,” Chief Justice John Roberts wrote for the majority. “To be clear, the Director need not review every decision of the PTAB. What matters is that the Director have the discretion to review decisions rendered by APJs.” Justices Samuel Alito, Neil Gorsuch, Brett Kavanaugh and Amy Coney Barrett joined Roberts in the majority opinion on parts I and II. Alito, Kavanaugh and Barrett joined Roberts for an opinion on part III. Justices Stephen Breyer, Sonia Sotomayor, Elena Kagan, Clarence Thomas and Gorsuch dissented to varying degrees. Gorsuch filed an opinion concurring in part and dissenting in part. Breyer filed an opinion concurring in the judgment in part and dissenting in part, with Sotomayor and Kagan joining. Thomas filed a dissenting opinion with Breyer, Sotomayor and Kagan joining for parts I and II. The high court ruled the appointments unconstitutional on the question of whether the authority of APJs to “issue decisions on behalf of the Executive Branch is consistent with the Appointments Clause of the Constitution.” Arthrex argued “APJs were principal officers who must be appointed by the President with the advice and consent of the Senate, and that their appointment by the Secretary of Commerce was therefore unconstitutional,” according to the filing. Computer & Communications Industry Association Patent Counsel Josh Landau disagreed that “PTAB judges were not already subject to sufficient supervision by the Director” but welcomed the court’s “simple, common-sense revision that provides for Director review.” DOJ and an attorney for the company didn’t comment.

Senate Commerce Committee Chair Maria Cantwell, D-Wash., and ranking member Roger Wicker, R-Miss., are having staff-level discussions about a legislative response to the Supreme Court striking down FTC Act Section 13(b) authority (see 2104260065), they told us. Cantwell previously said she wants to move quickly on legislation to bolster the agency’s authority. The committee has bill language, but “I don’t know when we’re rolling it out,” Cantwell told us. Wicker confirmed the staff discussions.

Senate Commerce Committee ranking member Roger Wicker, R-Miss., plans to introduce legislation to regulate online platforms like common carriers, he told us Monday. Citing a recent opinion from Supreme Court Justice Clarence Thomas advocating for such (see 2104090046), Wicker hoped to introduce the bill this week.

The Senate plans to vote Tuesday on final passage of the Endless Frontier Act (see 2105270082) and several potential amendments, an aide for Senate Majority Leader Chuck Schumer, D-N.Y., told us Friday. The Senate could consider a manager’s amendment, which might open the door to a host of additional provisions, per an aide for co-sponsor Sen. Todd Young, R-Ind. Some 30 senators are attempting to attach provisions to the manager’s package, lobbyists said.

The National Institute of Standards and Technology should tread lightly in defining “critical software” and avoid disincentivizing innovation, officials from Microsoft, Linux, BSA|The Software Alliance and cloud providers told NIST Wednesday. President Joe Biden’s cybersecurity executive order directs NIST to publish a definition by June 26.

Congress should enact federal privacy legislation that would give internet users the right to access and delete personal information, FTC acting Chairwoman Rebecca Kelly Slaughter wrote in a recent letter to Sen. Amy Klobuchar, D-Minn. An aide for Klobuchar, who supports access and deletion rights, said Tuesday the Senate Antitrust Subcommittee chair will continue pushing for such legislation.

Fully autonomous vehicles are at least five years from deployment, potentially much longer, a Carnegie Mellon University professor told the House Consumer Protection Subcommittee Tuesday. Members of both parties cited the need to develop a road map for AVs so China doesn’t take the lead on future deployment.

The Chips for America Act will help the U.S. develop manufacturing needed to compete with China and other adversaries, Sen. Joni Ernst, R-Iowa, said Monday. Debate within Congress is growing about appropriating $50 billion for domestic chip manufacturing incentives and research initiatives (see 2105110065) related to the Endless Frontier Act (S-1260). The legislation goes as far as possible now in pushing semiconductor development, but Congress is still incrementally educating its leaders, Ernst told a Brookings virtual event.