The Patent Eligibility Restoration Act of 2023 -- Will it make over the finish line?

Senator Thom Tillis’ Patent Eligibility Restoration Act of 2023 is moving through the U.S. Senate.  It appears to be a compromise to earlier patent eligibility reform legislation.  Here are the main provisions of the act. 

 

§ 101. Patent eligibility (a) IN GENERAL.—Whoever invents or discovers any useful process, machine, manufacture, or composition of matter, or any useful improvement thereof, may obtain a patent therefor, subject only to the exclusions in sub section (b) and to the further conditions and requirements of this title.

(b) ELIGIBILITY EXCLUSIONS.—

(1) IN GENERAL.—Subject to paragraph (2), a person may not obtain a patent for any of the following, if claimed as such: (A) A mathematical formula, apart from a useful invention or discovery. (B) A process that— (i) is a non-technological economic, financial, business, social, cultural, or artistic process; (ii) is a mental process performed solely in the human mind; or (iii) occurs in nature wholly independent of, and prior to, any human activity. (C) An unmodified human gene, as that gene exists in the human body. (D) An unmodified natural material, as that material exists in nature. 

(2) CONDITIONS.— (A) CERTAIN PROCESSES.—Notwithstanding paragraph (1)(B)(i), a person may obtain a patent for a claimed invention that is a process described in such provision if that process is embodied in a machine or manufacture, unless that machine or manufacture is recited in a patent claim without integrating, beyond merely storing and executing, the steps of the process that the machine or manufacture perform. (B) HUMAN GENES AND NATURAL MATERIALS.—For the purposes of subparagraphs (C) and (D) of paragraph (1), a human gene or natural material that is isolated, purified, enriched, or otherwise altered by human activity, or that is otherwise employed in a useful invention or discovery, shall not be considered to be unmodified. 

(c) ELIGIBILITY.—  (1) IN GENERAL.—In determining whether, under this section, a claimed invention is eligible for a patent, eligibility shall be determined—  (A) by considering the claimed invention as a whole and without discounting or disregarding any claim element; and (B) without regard to— (i) the manner in which the claimed invention was made; (ii) whether a claim element is known, conventional, routine, or naturally occurring;  (iii) the state of the applicable art, as of the date on which the claimed invention is invented; or (iv) any other consideration in section 102, 103, or 112. 

(2) INFRINGEMENT ACTION.— (A) IN GENERAL.—In an action brought for infringement under this title, the court, at any time, may determine whether an invention or discovery that is a subject of the action is eligible for a patent under this section, including on motion of a party when there are no genuine issues of material fact. (B) LIMITED DISCOVERY.—With respect to a determination described in subparagraph (A), the court may consider limited discovery relevant only to the eligibility described in that subparagraph before ruling on a motion described in that subparagraph.

Trump to Push Pharma on Drug Pricing

President Trump is continuing his push to fulfill campaign promises.  Apparently, he is meeting with pharmaceutical companies this week to negotiate lower drug prices.  This seems to be in response to his supposed Executive Order to link the drug prices that Medicare is charged to prices paid by foreign nations.  This was not an exciting development to pharmaceutical companies and they canceled a scheduled meeting with the President to discuss it.  It will be interesting to see if pharmaceutical companies will be willing to "play ball" with President Trump given the election.  For sure, part of the calculation is whether Presidential Candidate Joe Biden's administration would be better for pharmaceutical companies.  My guess is no.  However, I think the Obama Administration did not do as much as it could have on drug pricing directly--except that President Obama signed the Leahy-Smith America Invents Act into law which included rules concerning Inter-Partes Review Proceedings.  Also, pharmaceutical companies may be worried about additional Democratic appointees to the U.S. Court of Appeals for the Federal Circuit, where the battle over the scope of patent eligible subject matter is being waged (See American Axle en banc denial), and appointees to the U.S. Supreme Court.  FTC and DOJ antitrust enforcement is another issue as well as trade agreements.  Bayh-Dole Act march in rights could be an issue.  Moreover, under President Trump, pharmaceutical companies may be seeing some light at the USPTO concerning patent eligible subject matter.  Let's see if pharmaceutical companies are going to give President Trump a big win with Seniors (aka people who reliably vote). A compromise setting Medicare pricing near the most developed European countries would be interesting and an improvement.  

USPTO Report on Patent Eligible Subject Matter: Greater Certainty Achieved?

The United States Patent and Trademark Office (USPTO) has released an eleven page report titled, “Adjusting to Alice: USPTO Patent Examination Outcomes After Alice Corp. v. CLS Bank International,” on the impact of Patent Office changes on patent eligible subject matter.  U.S. patent eligible subject matter law has been described by some as a “mess,” which breeds uncertainty and may impact incentives to innovate and patent.  To address the apparently conflicting and confusing state of the law, the Patent Office has worked hard to provide guidance to examiners and applicants concerning the application of the law.  The USPTO report notes that recent guidance provided by the Patent Office has had a positive effect on predictability and certainty concerning the doctrine.  Of particular interest, the guidance provided by the Patent Office has a positive impact on Alice-effected technologies.  The full report is available, here.  The Press Release states: 

WASHINGTON - The United States Patent and Trademark Office (USPTO) today published a report authored by its Chief Economist titled, Adjusting to Alice: USPTO patent examination outcomes after Alice Corp v. CLS Bank International. The report highlights how recent actions undertaken by the USPTO have brought greater predictability and certainty to the determination of patent eligibility in the technology areas most affected by the decision.

“We have heard anecdotally from both examiners and applicants across the entire spectrum of technologies that our 2019 guidance on Section 101 greatly improved the analysis in this important area of patent law,” said Andrei Iancu, Under Secretary of Commerce for Intellectual Property and Director of the United States Patent and Trademark Office. “The Chief Economist’s report now confirms this general perception, especially with its critical finding that uncertainty decreased by a remarkable 44%.” 

The report’s analysis by the USPTO’s Office of the Chief Economist found that one year after the USPTO issued its January 2019 Revised Patent Subject Matter Eligibility Guidance (2019 PEG), the likelihood of Alice-affected technologies receiving a first office action with a rejection for patent-ineligible subject matter had decreased by 25%. Likewise, uncertainty about determinations of patent subject matter eligibility in the first action stage of patent examination for the relevant technologies decreased by 44% over the first year following publication of the 2019 PEG compared to the previous year.

“The primary economic function of the patent system is to provide an incentive for greater innovation,” according to Dr. Andrew Toole, Chief Economist of the United States Patent and Trademark Office and principal author of the report. “Using an evidence-based approach, our report highlights the significant impact of the Supreme Court’s Alice decision on patent examination outcomes and the important stabilizing role played by the USPTO. This is what innovators and investors need to confidently promote entrepreneurship, create jobs, and advance science and technology.”

Director Iancu added, “I have long said that in order to ensure that the United States remains the global leader in the technologies of the future, our patent system must move beyond the recent years of confusion and unpredictability on subject matter eligibility. It is now clear that our recent guidelines mark a significant step in that direction, and I ask all involved in our treasured patent system to come together and solve, once and for all, this fundamental issue.”

Patent Eligible Subject Matter Reform in the United States: The Pendulum Will Swing Too Far (again)?

In the United States, the law of patent eligible subject matter has become a big mess.  There are many different ways to frame how we got to this point.  One narrative tracks the concern with so-called patent trolls and the issuance of poor patents by the USPTO.  For sure, many have had concerns about the enforcement of patents and there have been a number of issued poor quality patents by the USPTO.  Part of the problem with the reform effort may have been that there were just too many proposals adopted to confront the issues.  In a perfect world, I suppose that a proposal would be enacted and then we would gather data and try to assess its impact.  We essentially made many policy changes creating perhaps an even larger mess with different problems--perhaps to the detriment of innovation.  Indeed, perhaps the changes to patent eligible subject matter law by Alice and Mayo may have gone too far—in light of other changes to the U.S. patent system designed to curb troubling enforcement and poor patent quality.  


One of the main current problems seems to be the application of the Alice/Mayo test and the failure to achieve consistency in its application.  Unfortunately, one casualty of Alice/Mayo may be collegiality amongst U.S. Court of Appeals for the Federal Circuit judges and the institution itself—the recent opinion, American Axle & Manufacturing v. Neapco Holdings, issued on October 3, 2019 is an interesting example.  Basically, Judge Moore writing the dissent is accusing Judge Dyk, author of the majority opinion, for engaging in judicial activism among other things.  I believe that most think that judges should “call it as they see it.”  However, the problem may be the test itself—it’s just too difficult to apply with consistency and that a reasonable application could result in problems, particularly if there is an underdeveloped record.  For sure, the attempt to utilize patent eligible subject matter as a way to eliminate cases early has been eroded by some panels of the Federal Circuit.  Does this mean that the main value of the test has been lost?  Should we stick to obviousness as the gatekeeper of patentability?  Can Congress actually fix this without overshooting eligibility resulting in more and different problems?  What about the concern with drug pricing?  Is the current test for patent eligible subject matter unfixable?  Do we need to think harder about different patent eligible subject matter rules for different industries?  Does it look like the Federal Circuit is properly using doctrines as policy levers across different industries?  I do think we would likely agree that keeping the Federal Circuit is a good idea (there are some that disagree).  

The Subcommittee on IP in U.S. Senate Reinstated; First Action is Patent Eligible Subject Matter Reform

Recently, several members of Congress have reinstituted the Subcommittee on Intellectual Property in the U.S. Senate.  This, in and of itself, is relatively big news.  We can expect a good amount of proposed legislation moving out of this subcommittee concerning intellectual property in the near future.  

The first document to issue from the subcommittee (and includes support from members of the House of Representatives as well as the Senate) is essentially a framework for Section 101 patent eligible subject matter reform.  Patent eligible subject matter has been a controversial topic in the United States for years, and attempts to cabin the U.S. Supreme Court Alice v. CLS Bank/Mayo v. Prometheus decisions by the United States Patent and Trademark Office and some judges of the U.S. Court of Appeals for the Federal Circuit has led to a relatively messy and some may argue contradictory set of guidelines, rules and precedent.  This may be unhelpful to promote investment and innovation. 

A Press Release from Senator Christopher Coons from Delaware sets forth the outline of the framework:

·         Keep existing statutory categories of process, machine, manufacture, or composition of matter, or any useful improvement thereof.

·         Eliminate, within the eligibility requirement, that any invention or discovery be both “new and useful.” Instead, simply require that the invention meet existing statutory utility requirements. 

·         Define, in a closed list, exclusive categories of statutory subject matter which alone should not be eligible for patent protection. The sole list of exclusions might include the following categories, for example: 

·         Fundamental scientific principles;

·         Products that exist solely and exclusively in nature;

·         Pure mathematical formulas;

·         Economic or commercial principles;

·         Mental activities. 

·         Create a “practical application” test to ensure that the statutorily ineligible subject matter is construed narrowly.

·         Ensure that simply reciting generic technical language or generic functional language does not salvage an otherwise ineligible claim.

·         Statutorily abrogate judicially created exceptions to patent eligible subject matter in favor of exclusive statutory categories of ineligible subject matter.

·         Make clear that eligibility is determined by considering each and every element of the claim as a whole and without regard to considerations properly addressed by 102, 103 and 112. 

While this list appears to serve as a list of the broad strokes of the new legislation, it clearly appears to roll back the Alice/Mayo test.  Some of the parts of the framework appear to be concessions to some groups who might be opposed to broad subject matter eligibility, such as some technology companies.  For an IP legislative wish list by the AIPLA, please see, here.  A Congressional Research Service report on patent eligibility reform by Professor Jay Thomas is available, here.  The CRS report predates some of the more recent U.S. Court of Appeals for the Federal Circuit and USPTO decisions concerning eligibility, and includes a discussion of patent eligibility reform proposals from major IP trade associations.  If patent eligibility legislation is passed along the lines of the framework, it nicely sets up the question of how we should reform nonboviousness law, which will have increased importance as the major policy lever policing patentability. 

Here are some of the statements of Congressmen supporting patent eligibility reform:

“Today, U.S. patent law discourages innovation in some of the most critical areas of technology, including artificial intelligence, medical diagnostics, and personalized medicine,” said Senator Coons. “That’s why Senator Tillis and I launched this effort to improve U.S. patent law based on input from those impacted most. I am grateful for the engagement of all stakeholders participating in our roundtables, as well as the bipartisan and collaborative efforts of colleagues in both the Senate and the House. I look forward to continuing to receive feedback as we craft a legislative solution that encourages innovation.”

“Senator Coons and I requested to re-instate the Senate Judiciary Subcommittee on IP because we saw a need to reform our nation’s complicated patent process, starting with section 101,” said Senator Tillis. “The release of this framework comes after multiple roundtables and extensive discussions with stakeholders who would be affected by reforming Section 101. Senator Coons and I look forward to receiving feedback from the release of this framework and encourage anyone who might potentially be affected to contact our office and offer us input.”

 “Upgrading the patent eligibility test is critical if we want American innovation to continue to lead worldwide,” said Rep. Collins. “Encouraging innovation in Georgia and throughout our country means restoring confidence for inventors and investors that their patent rights will be upheld in court.”

“I’m pleased to participate in this important and relevant roundtable. Many have voiced concerns about uncertainties in in this area of patent law jurisprudence, and I’m interested in hearing from all stakeholders as we continue to work towards a consensus solution,” said Congressman Hank Johnson, who serves as Chairman of the Judiciary Subcommittee on Courts, IP and the Internet. “I particularly look forward to—and welcome—feedback on the outline proposal we’re considering here today.”

“In my home state of Ohio, leaders in the fields of biologics research and diagnostics will deliver the cures of tomorrow. This is only possible if we can protect those innovations with the patent protection that rewards the risks and investment necessary to discover the next great idea,” said Rep. Stivers. “We have the opportunity to advance our society in so many exciting and unknown ways, and we need to ensure we have a patent system that encourages that kind of game-changing innovation, instead of stifling it.”

Patent Eligible Subject Matter: Bait and Switch Works Well?

The United States Patent and Trademark Office (USPTO) has released guidelines on patent eligible subject matter as well as section 112 issues concerning computer implemented inventions.  Once again, some believe there’s arguably a shift on the treatment of patent eligible subject matter at the USPTO.  It’s hard to imagine that patents may draw investment if there is a lack of certainty and stability with respect to patent rights.  On the other hand, the biotechnology industry arguably developed around many patents that were eventually invalidated—it doesn’t get much more uncertain than arguably changing the rules of the game later.  Does that mean we should look toward broader subject matter or narrow subject matter—both of which could be more certain and stable?  On the broad side, I suppose we can always dump patents later—the U.S. Supreme Court has nicely rejected reliance arguments.  If we experience problems with patents and innovation in the future, then we invalidate the patents.  As long as the capital is drawn forth for productive use based in part from the original patents, then from society’s perspective maybe all is good and the problem is avoided—as long as the industry develops and some investors receive some return (at least enough to keep playing).  Who knows what is lost from broad subject matter--particularly with new, developing technology.  Here is an excerpt from the press release:  

“These guidance documents aim to improve the clarity, consistency, and predictability of actions across the USPTO,” said Under Secretary of Commerce for Intellectual Property and Director of the USPTO Andrei Iancu. “The USPTO will provide training to examiners and administrative patent judges on both documents to ensure that guidance is being properly administered.”

The “2019 Revised Patent Subject Matter Eligibility Guidance” makes two primary changes to how patent examiners apply the first step of the U.S. Supreme Court’s Alice/Mayo test, which determines whether a claim is “directed to” a judicial exception.

• First, in accordance with judicial precedent and in an effort to improve certainty and reliability, the revised guidance extracts and synthesizes key concepts identified by the courts as abstract ideas to explain that the abstract idea exception includes certain groupings of subject matter: mathematical concepts, certain methods of organizing human activity, and mental processes.
   
• Second, the revised guidance includes a two-prong inquiry for whether a claim is “directed to” a judicial exception. In the first prong, examiners will evaluate whether the claim recites a judicial exception and if so, proceed to the second prong. In the second prong, examiners evaluate whether the claim recites additional elements that integrate the identified judicial exception into a practical application. If a claim both recites a judicial exception and fails to integrate that exception into a practical application, then the claim is “directed to” a judicial exception. In such a case, further analysis pursuant to the second step of the Alice/Mayo test is required.

The “Examining Computer-Implemented Functional Claim Limitations for Compliance with 35 U.S.C. § 112” guidance emphasizes various issues with regard to § 112 analysis, specifically as it relates to computer-implemented inventions. The guidance describes proper application of means-plus-function principles under § 112(f), definiteness under § 112(b), and written description and enablement under § 112(a).

These guidance documents have been issued concurrently to ensure consistent, predictable, and correct application of these principles across the agency. 

The USPTO is seeking public comments on the new guidance. 

Judges Lourie and Newman of the Federal Circuit Critique Alice/Mayo and Myriad

The U.S. Court of Appeals for the Federal Circuit, in AatrixSoftware, Inc. v. Green Shades Software, Inc., recently denied a rehearing en banc concerning two cases that may make it more difficult to dismiss a claim challenged for lack of patent eligible subject matter under the Alice/Mayo test because of factual issues.  This leaves intact the ability of counsel to raise factual issues which may avoid early resolution of a patent infringement action on patent eligible subject matter grounds.  Notably, Judges Lourie and Newman, both of whom have graduate degrees in technical fields and are very experienced members of the Federal Circuit, requested in a concurring opinion that the U.S. Congress revisit patent eligible subject matter, particularly in light of the Alice/Mayo test and the U.S. Supreme Court “abstract idea gloss.”  Judge Lourie states:

The case before us involves the abstract idea exception to the statute.  Abstract ideas indeed should not be subject to patent.  They are products of the mind, mental steps, not capable of being controlled by others, regardless what a statute or patent claim might say.  Gottschalk v. Benson, 409 U.S. 63, 67 (1972) (“[M]ental processes, and abstract intellectual concepts are not patentable, as they are the basic tools of scientific and technological work.”).  No one should be inhibited from thinking by a patent.  See Letter from Thomas Jefferson to Isaac McPherson (Aug. 13, 1813) (“[I]f nature has made any one thing less susceptible, than all others, of exclusive property, it is the action of the thinking power called an Idea.”).  Thus, many brilliant and unconventional ideas must be beyond patenting simply because they are “only” ideas, which cannot be monopolized.  Moreover such a patent would be unenforceable.  Who knows what people are thinking?  

But why should there be a step two in an abstract idea analysis at all?  If a method is entirely abstract, is it no less abstract because it contains an inventive step?  And, if a claim recites “something more,” an “inventive” physical or technological step, it is not an abstract idea, and can be examined under established patentability provisions such as §§ 102 and 103.  Step two’s prohibition on identifying the something more from “computer functions [that] are ‘well-understood, routine, conventional activit[ies]’ previously known to the industry,” Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 134 S. Ct. 2347, 2359 (2014) (alteration in original) (quoting Mayo, 566 U.S. at 73), is essentially a §§ 102 and 103 inquiry.  Section 101 does not need a two-step analysis to determine whether an idea is abstract.   I therefore believe that § 101 requires further authoritative treatment.  Thinking further concerning § 101, but beyond these cases, steps that utilize natural processes, as all mechanical, chemical, and biological steps do, should be patent-eligible, provided they meet the other tests of the statute, including novelty, nonobviousness, and written description.  A claim to a natural process itself should not be patentable, not least because it lacks novelty, but also because natural processes should be available to all.  But claims to using such processes should not be barred at the threshold of a patentability analysis by being considered natural laws, as a method that utilizes a natural law is not itself a natural law.

Judge Lourie also criticized the U.S. Supreme Court’s decision in Myriad Genetics:

[F]inding, isolating, and purifying such products are genuine acts of inventiveness, which should be incentivized and rewarded by patents.  We are all aware of the need for new antibiotics because bacteria have become resistant to our existing products.  Nature, including soil and plants, is a fertile possible source of new antibiotics, but there will be much scientific work to be done to find or discover, isolate, and purify any such products before they can be useful to us.  Industry should not be deprived of the incentive to develop such products that a patent creates.  But, while they are part of the same patent-eligibility problems we face, these specific issues are not in the cases before us.   Accordingly, I concur in the decision of the court not to rehear this § 101 case en banc.  Even if it was decided wrongly, which I doubt, it would not work us out of the current § 101 dilemma.  In fact, it digs the hole deeper by further complicating the § 101 analysis.  Resolution of patent-eligibility issues requires higher intervention, hopefully with ideas reflective of the best thinking that can be brought to bear on the subject.

There are numerous proposals for changing patent eligible subject matter before the U.S. Congress, for example, see the AIPLA proposal, here. 

USPTO Releases Report on Public Views on Patent Eligibility Rules

The United States Patent and Trademark Office (USPTO) has released a report titled, “PATENT ELIGIBLE SUBJECT MATTER:  REPORT ON VIEWS AND RECOMMENDATIONS FROM THEPUBLIC” (Report) concerning the comments of participants at USPTO sponsored roundtables concerning the patent eligible subject matter requirement, particularly post-Alice/Mayo.  The USPTO summary of the Report states:

Much of the feedback we received highlighted the complexities of determining the appropriate boundaries of patent subject matter eligibility. Commenters confirmed that the recent Supreme Court cases have significantly changed the standards for determining patent subject matter eligibility. Several commenters expressed concern that these decisions have created inconsistency, uncertainty, and unpredictability in the issuance and enforcement of patents, particularly in the life sciences, software, and e-commerce industries.

A diverse group of representatives from academia, industry, law firms, and legal associations proposed legislative changes aimed at reversing the recent trend in the law and restoring, in their view, a more appropriate dividing line between eligible and ineligible subject matter. In contrast, a sizable portion of representatives from the software industry argued that the Court’s two-step test provides an appropriate standard for patent subject matter eligibility. This group cautioned against legislative redress and instead recommended that the common law should be allowed to evolve.

The following is a list of the views against the new rules: “1) Decisions are Legally Flawed; 2) Exceptions are Overbroad; 3) Two Step Test is Unclear and Causes Unpredictability; 4) Preemption Conflates 101 with other Patentability Requirements; 5) Jurisprudence Stifles Innovation and Hurts Business; and 6) Consistency of U.S. Law with International Norms.” Here is a list of the views in favor of the new rules: “1) Common Law Process at Work; 2) Weeds Out Overbroad Patents; 3) Requires Claiming a Specific Way and Not a Result; 4) Litigation Tool Against Patent Assertion Entities; and 5) May Give U.S. Entities an Advantage.” 

On the point in favor of the new rules based on May Give U.S. Entities an Advantage, the Report states:

Even if the Supreme Court’s new eligibility standard differs from standards abroad, a few commentators projected that the difference could actually operate to the benefit of the United States. For example, one commentator argued that because foreign entities have an increasing stake in the U.S. patent system, “[g]eopolitical considerations . . . weigh heavily in favor of” the Supreme Court’s Mayo and Alice decisions.246 In fact, she cautioned that if the U.S. were to adopt an overly expansive patentability standard, then not only would “American inventors, American companies, American investors, and the American public” benefit, but an “equal or greater benefit [would] inure to foreign inventors, foreign companies, and, in some cases foreign governments.”247 Another participant asserted that “if a company is innovating because it can get patents in Germany or Europe but it may not be able to get as much protection in the U.S., that innovation is still happening.” 248 And, she added, “if our consumers can benefit from the additional competition that a lack of patent [protection] provides and pay lower prices here” and “the innovator can still get their investments recouped by getting monopoly profits elsewhere” that may not be a bad deal for our consumers.249

Members of the life sciences community were relatively united in their critique of the new patent eligible subject matter rules.  The computer/related technologies community was apparently less united on whether the patent eligible subject matter rules were a good thing or not. 

There are also several legislative proposals for change, including: Replace the current test with a technological arts or useful arts test; Expressly define exceptions to eligibility; Distinguish eligibility from other patentability requirements; and Establish a research exemption to infringement. 

The text concerning the research exemption states, in relevant part:

Several commentators proposed a legislative amendment to recognize a research exemption from patent infringement for experimentation conducted to better understand or improve a claimed invention.427 According to these commentators, such an amendment would address the Supreme Court’s preemption concerns, i.e., concerns that patents on foundational technological tools may stifle scientific progress by tying up the basic building blocks of human ingenuity.428 One commentator suggested that the exemption could be tailored such that “patents on research tools would be unaffected, but research on a patented invention itself would not be subject to infringement allegations.”429  

The USPTO should be applauded for its hard work in trying to make the patent eligible subject matter rules and their application accessible, and obtaining the public’s viewpoint. 

Trump Administration Suspends Program for Visas for Entrepreneurs

The Trump Administration suspended an Obama Administration program about to go in effect that would provide visas to entrepreneur immigrants.  According to the Wharton School of Business, the program would help create jobs in the United States and had little downside.  The program is apparently similar to others created in Canada, France and Argentina.  Notably, the Trump Administration is supporting new legislation to radically reform the immigration system in the United States by moving to a supposed “merit” based system designed to reduce immigration by 50%.  The Wharton School of Business states:

Immigrants make up about 12% of the U.S. working population, [Hsu] added. Among STEM (science, technology, engineering and math) workers, immigrants make up 24% of bachelors and 47% of doctorates, he continued. “So [immigrant entrepreneurs] are punching above their weight in the talent pool for the workforce that we desire in the U.S.,” he said. He pointed to one much-cited statistic: foreign-born entrepreneurs make up about half the founders in the so-called “billion dollar club” of startups that are worth at least a billion dollars each. 

In an Op-Ed in Crain’s New York Business, Orin Herskowitz, the Senior Vice President of Intellectual Property and Technology Transfer of Columbia University and President of Columbia Technology Ventures, states that:

The rule, one of President Barack Obama’s final acts in office, provides so-called “startup visas” long sought by Silicon Valley. It is narrow, allowing foreign entrepreneurs to live in the United States for 30 months while building their companies. To qualify, applicants must show that they have reputable investment in their company of no less than $250,000 and the potential for a positive impact on economic growth and job creation. The rule has now been delayed until next March, and the Department of Homeland Security has given notice that the administration will propose rescinding the program before then. . . .

There are other storm clouds on the horizon. The president’s proposed budget reduces funding for basic science. And the legal playing field is beginning to tilt against innovators, most dramatically through a retreat from the respect for patent protection recognized by our Constitution more than two centuries ago as a bulwark of our economy. The former director of the U.S. Patent and Trademark Office, David Kappos, points out that a series of court decisions have rendered many biotech and software inventions un-patentable or at best uncertain in the U.S., causing the abandonment of promising research, or the repositioning of that research overseas to China, where affirmative steps have been taken to strengthen patent protection.

[Hat tip to Technology Transfer Central for the lead to the articles.]