updated 6/8/2005 6:38:01 PM ET 2005-06-08T22:38:01

The high-tech industry calls them "patent trolls" — people who get patents for products they never plan to make, just so they can sue for infringement if a company does turn out something similar.

That is how critics describe the inventor from Great Falls, Va., whom Internet giant eBay wants to take to the Supreme Court over online selling techniques he patented.

Now Congress, urged on by a coalition of high-tech companies that includes eBay, wants protection against such people.

"I think patent trolls are abusing the system," said Rep. Lamar Smith, R-Texas, who wrote the bill.

The first major changes to patent law since 1999 are running into opposition from drug makers, fearful an overhaul could stifle their ability to bring innovative products to the market.

A bill introduced in the House on Wednesday would make it harder for patent-holders to get court orders to stop the sale of products that potentially infringe on their patents. Challenging a patent would become easier.

Also, the legislation would commit the U.S. to international standards on patent registration: The patent goes to the inventor who files first.

Smith, chairman of the House Judiciary subcommittee on intellectual property, co-sponsored the bill with the committee's top Democrat, Rep. Howard Berman, D-Calif. A hearing was set for Thursday.

The Information Technology Industry Council, which represents eBay and other high-tech companies, says patent lawsuits in federal court doubled from 1,200 to 2,400 annually from 1998 to 2001.

"The broken patent system right now, and the rise in lawsuits, has unfortunately discouraged our companies from innovating, and patent trolls are gaming the system," said Josh Ackil, the group's vice president of government relations.

The boom of the 1990s led to a rush to patent new kinds of technology, some of which was poorly understood at the time, the industry says.

Drug companies nervous
Unlike high-tech businesses, pharmaceutical companies do not have the same problems with "patent trolls" because drug formulas generally are more difficult to develop than computer technology.

"Any attempts to change or weaken current patent laws could have a profound impact on our companies' ability to create new innovative drugs and save lives," said Ken Johnson, senior vice president at the Pharmaceutical Research and Manufacturers of America.

Representatives of PhRMA, the Biotechnology Industry Organization, high-tech groups and others failed in recent meetings to reach agreement on possible changes to patent law.

A judges now can issue an order to protect patent rights. The House bill would allow orders only if the patent-holder would suffer irreparable harm without one.

High-tech companies contend that judges grant orders almost automatically, giving too much power to patent-holders.

But lawyers and small-time inventors like Tom Woolston of Virginia, who took on eBay, say court orders are not so common and that problem of patent trolls is exaggerated.

Woolston defended his five-person company, MercExchange, as a legitimate business that, before the court case with eBay, hoped to develop online sales techniques. EBay lost in a lower court and wants the Supreme Court to take the case.

The proposed legislation would favor big companies, Woolston said. "If you didn't have your owner's right of patent — which is the ability to stop somebody from using the invention — how can a small company raise money to build an invention?" he asked.

Copyright 2005 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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