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Policy: Technology

White House watches patent reform go from certain victory to embarrassing defeat

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Politics,White House,Brian Hughes,Barack Obama,Harry Reid,PennAve,Patrick Leahy,Law,Technology,Patent Law,Magazine

President Obama, mired in the worst political stretch of his presidency, can't even get a sure-fire win these days.

To say the White House was bullish this winter about the prospects for patent reform would be an understatement.

The Republican-controlled House gave Obama a rare victory in December when it overwhelmingly passed a bill to combat patent trolls -- companies that exist mainly to file lawsuits over infringement claims, using vague regulations to score settlements from businesses looking to avoid massive legal costs.

Obama then took the rare step of addressing the esoteric issue in his State of the Union address, calling on the Senate to pass a “patent reform bill that allows our businesses to stay focused on innovation, not costly and needless litigation.”

Armed with GOP support, that was considered a formality. Patent reform was seen as one of the few, if only, serious measures capable of passing a badly divided Congress this year.

The tech community praised Obama, with the publication Wired writing, "History will remember Obama as the great slayer of patent trolls."

Less than six months later, patent reform is dead. And Obama can thank his own party for the embarrassing defeat.

"I am furious with what happened,' Sen. Patrick Leahy, D-Vt., told his hometown paper, the Burlington Free Press, of the bill he sponsored. "We worked so hard to get a coalition. Harry Reid and a couple of others said, ‘We won't let it come to the floor.' I think that's wrong, but I'm not going to give up."

The legislation faced opposition from some universities and drug companies concerned that the reforms would put some of their patents at risk. Trial lawyers also opposed the law. The groups heavily lobbied Reid to spike the legislation, Senate staffers said.

But the legislative package counted among its supporters major tech companies, including Apple, Facebook and Google.

"Today, abusive patent litigation is killing small companies, chilling employment and growth of all companies, and stifling the economies of a wide range of industries nationwide," the tech businesses wrote in a letter to Leahy and Sen. Chuck Grassley, R-Iowa. "Instead of investing in new jobs and services, businesses must fight frivolous claims and overly broad lawsuits made by patent trolls against a range of technologies and commonplace ideas."

Senior administration officials assumed the support of big business, as well as smaller firms, would put the legislation on the fast track. The White House estimated that patent trolls cost U.S. companies nearly $30 billion in 2011 alone.

“I think that there’s no reason that there shouldn’t be that same ability to work together in the United States Senate,” then-National Economic Council Director Gene Sperling said in February. “I think this is an area where you can see a sweet spot for bipartisan compromise.”

Instead, the Democratic squabble is putting patent reform back in the headlines — and not for the reasons the White House wanted.

“The president remains committed to getting this done,” a senior administration official insisted, calling the lack of action in the Senate "regrettable."

Republicans were quick to use the liberal infighting to hit back at claims that the GOP is the lone party responsible for Washington gridlock.

“The American people, who are still asking, 'where are the jobs?' have a right to be furious, as well,” said Michael Steel, a spokesman for House Speaker John Boehner, R-Ohio.

Earlier this year, Obama issued a trio of executive orders bolstering training and resources to identify patents. But those measures were small initiatives meant to augment broader legislation.

In a ruling cheered by the White House, the Supreme Court said in June that an abstract idea by itself is not worthy of a patent -- an action long sought by reformers. But the tabled Senate legislation goes much further to prevent the types of actions decried by the president.

Now, Obama is left to lament why his own party denied him a badly needed win.

When asked of a new White House timeline for patent reform, the senior administration official replied, “That really isn’t up to us.”

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