“Views on the New (or Pending) Patent Reform Legislation”

1. “Views on the New (or Pending) Patent Reform Legislation” Gary L. Griswold President and Chief Intellectual Property Counsel 3M Innovative Properties Company Chair, Steering Committee of the Coalition for 21st Century Patent Reform AIPLA Annual Meeting October 18, 2007

2. Patent Reform Act of 2007

3. 18 Industries Represented

4. The Playbook • NAS Report (April 2004) – “A Patent System for the 21st Century” • 7 recommendations • Preserve Unitary, Flexible Patent System • Reinvigorate Non-Obviousness Standard • Institute Open Review (Post-Grant) Procedure • Strengthen USPTO Capabilities • Provide Research Exemption • Modify or Eliminate Subjective Elements of Litigation • Inequitable Conduct • Best Mode • Willful Infringement • Foster Harmonization

5. But landscape is changing… The Supreme Court, Federal Circuit and PTO Have Jumped In • Injunctions • eBay • DJ Jurisdiction • MedImmune • 271(f) • Microsoft • Obviousness Standard • KSR • Willful Infringement • Seagate • PTO Claims & Continuation Rules…

6. H.R. 1908, S. 1145 “Patent Reform Act of 2007” Introduced April 18, 2007 Sen. Leahy (D) and Rep. Berman (D), each with numerous original co-sponsors 2007: Bicameral and Bipartisan Chairman Leahy Senator Hatch Chairman Berman Congressman Smith

7. Key Provisions (NAS) (NAS) (NAS) (NAS) (NAS) (NAS) (NAS) Not Included Included Conceptually Unacceptable Amendments Needed OK

8. The Players Defense Focused • Coalition for Patent Fairness • Business Software Alliance • Generic Drug Industry • Financial Services Roundtable NAS Focused • Coalition for 21st Century Patent Reform • Innovation Alliance • Universities • PhRMA • BIO

9. Weighing In • Chief Judge Paul Michel • Administration • ABA-IPL Section • AIPLA • IPO • NAM • AFL-CIO • Communication Workers • United Steel Workers • Independent Inventors • Venture Capital • Medical Device Manufacturers Association

11. Message from Senators “I have friends on both sides and I always vote in support of my friends.” “Please work this out.”

12. Negotiations Leahy/Hatch September 24, 2007 All Issues • Coalition for 21st Century Patent Reform • Innovation Alliance • Coalition for Patent Fairness • PhRMA • BIO • Financial Services • AAU • Venture Capital • InterDigital • Cisco • GE • Intellectual Ventures • Motorola • IBM • Microsoft Specter/Feinstein Process August to Present Damages • Coalition for 21st Century Patent Reform • Innovation Alliance • Coalition for Patent Fairness • BIO • Univ. of California • Financial Services • AAU Berman Pre Mark-Up • Post-Grant

13. Key Provisions (NAS) (NAS) (NAS) (NAS) (NAS) (NAS) (NAS) Not Included Included Conceptually Unacceptable Amendments Needed OK

14. We are the stewards of the Patent System

15. Thank you

16. Post-Grant [Senate Bill] • Serial attacks for the life of the patent.

17. Inequitable Conduct Reform[Both Bills] • This is a patent quality issue. • Codifies - does not fix. • The PTO Rule Changes have made Inequitable Conduct Reform even more necessary.

18. Damages • The wrong comparison at the wrong time. [Both Bills] “Claimed Invention’s specific contribution over the prior art.” • If not marked - 2, not 6, years of past damages. [Senate Bill]

19. Venue [Senate Bill] • Takes away the right for traditional research, development and manufacturing companies to sue where they do those activities. • Allows foreign entity infringers to forum shop.

20. Applicant Responsibilities[Both Bills] • Mandatory search & analysis would add an average of more than $4200 to costs of filing a patent application (AIPLA Report of the Economic Survey 2007)