The Senate overwhelmingly passed legislation to overhaul the U.S. patent system, reviving a long-stalled effort and raising industry hopes that the biggest changes to patent laws in almost six decades could soon be enacted.

Almost 60 years have passed since the last revisions to the patent system, but thanks to a recent Senate decision we may be on the brink of some big changes. The trouble is that if you are an entrepreneur or are an innovative small businessman, you might be coming up short with this reform.

As MarketWatch reports, there are a number of changes introduced in the bill even if certain decisions were dropped from the original proposal. The biggest change in the Senate’s overhaul decision is a transition of patent-rights. Whereas patents have always been under a “first to invent” system, the idea is to shift over to a far less complicated “first to file” system. As one might imagine, this would eliminate a good amount of legal challenges by eliminating the need to appeal to facts outside of the patent offices. Also as one would imagine, it’s a tremendous boon to big companies that often get bogged down in patents challenges such as Caterpillar and GE, two of the companies from the Coalition for 21st Century Patent Reform that worked to push the reform bill through the Senate.

Entrepreneurs are less happy. For one thing, “first to invent” has always given the lonely entrepreneur an edge against big business. For another, entrepreneurs and small businessmen don’t have the same resources as a big company and are therefore at a disadvantage in rushing patents to the office in order to rush a product to market. Couple this problem with the possibility that patent filings might also see higher application fees (an expected result from another change that gives the Patent Office the power to set its own funding) and the possible problem only gets worse.

The Senate’s ostensible goal was to streamline the patent process in the name of global competition in the face of rising Chinese patents, but it doesn’t seem to be a good deal for small business. It’ll be an issue to watch out for if it affects you, especially since the House Judiciary Committee is expected to put forward its own proposal in the coming weeks.


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