Economist Comes Out For Patent Reform

from the a-movement-is-building dept

More and more people in the business world seem to be realizing that the patent system is a complete mess. The cries have been getting louder and louder for patent reform, with the latest being the Economist who pretty much trashes the current patent system for “inhibiting, rather than encouraging, commercial innovation,” which probably sounds familiar. There’s nothing particularly new in the article, but it is good to see more press coverage of a topic that too many ignore. What they don’t mention, however, is that the real problem that keeps the patent system bogged down is that patent lawyers are too powerful, and have no interest in changing the system. To them, all of these ridiculous and innovation killing patents are wonderful, because they bring in a ton of money. Patent disputes (of which there are many) only bring in more money. The incentives are wrong, but our politicians look to the patent lawyers as “experts” on the patent system, rather than to those who actually need to do the innovating. The end result is that the patent system gets worse and worse, and moves further away from its reason for being: to promote innovation.

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Comments on “Economist Comes Out For Patent Reform”

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Jim Harper (user link) says:

Patent System Restraining Innovation

This week at the U.S. Federal Trade Commission’s workshop on e-mail authentication, it was clear that tension over the patentability of various e-mail authentication methods has hindered the development and deployment of authentication standards and thus suppressed an important tool for spam suppression. Hmmmm. Patent reform.

Dan Burns (user link) says:

There is more than one issue here

To say that lawyers are the problem is a gross over simplification. Have you ever asked a patent attorney their opinion on this issue? Many patent attorneys have years of engineering experience under their belts. Speaking for myself and my colleagues, we flatly abhor junk patents. They create frivolous and extremely expensive litigation which clogs the courts and drains vital resources from companies. As a professional, I do waste time writing patents for my clients which I feel will be found invalid down the road. My clients are savvy enough to know the difference between a good patent and a junk patent. They?re not paying me to create a worthless portfolio. Most competent patent lawyers will tell you the same.

How did we get here and how do we fix the problem? There are differing opinions. Shipping all of the patent attorneys to Siberia won?t solve the problem. (But, as my father says, ?It?s a good start.?) As I see it, there are four facets to the software patent dilemma: 1) the PTO has extremely poor quality control which means relevant prior art is overlooked and/or the Examiner fails to understand that the invention is obvious; 2) the Federal Circuit which hears all appeals of patent cases has made the standard for finding an invention obvious too easy to overcome; 3) Congress continues to drain money from the PTO year after year and has failed to mandate a new standard of obviousness for software inventions; and 4) many patent attorneys don?t understand software which results in poorly crafted, overly broad patents. I think all of these issues need to be addressed.

On a positive note, the Intellectual Property Owners Association (IPO) whose members include companies and patent law firms around the country has lobbied hard for a number of years to get Congress to stop draining money from the PTO so that patent examination quality can be improved. To date, the effort has been unsuccessful. But I think Congress is starting to listen. More meaningful dialog on the issue, in the press and in blogs like this, may eventually help get the message across.

DD says:

Re: There is more than one issue here

Hey Dan,

Its demonstrated to me how software development has been greatly encumbered by the patent threat.

With SOOO many ridiculous patents being highlighted daily, I’d be interested in seeing some examples where licensing a patent, particularly of the business method class, has greatly benefited society.


Dan Burns (user link) says:

Re: Re: There is more than one issue here

Every small business owner who has had to raise VC, fend off a spate of copycat competitors, or required leverage to avoid paying protection money to a large corporation’s licensing “program” will tell you that patents are of great benefit, even business method patents. Small businesses create jobs, pay taxes, introduce diversity into the marketplace, etc.

Business method patents are nothing more than process patents. The name derives from the fact that the subject matter is a previously known method of doing business newly implemented as software. Should these be patented? In my opinion, if there is nothing novel about the software architecture or algorithms, then probably not. However, that is not the standard for patentability in the U.S. Here, even incremental improvements can be patented — i.e., the improvements are not “obvious”. This has made getting patents easy as shooting fish in a barrel. And companies with big pockets know this and are gaming the system.

Unfortunately, once a patent issues, it’s hard to invalidate. This needs to change. Currently, an issued patent can be challenged in an administrative proceeding with the Patent Office, but it is at the Office’s discretion. The other alternative is to file for a declaratory judgment that the patent is invalid. But now we’re talking about drawn out discovery and — maybe several years down the road — litigation. And keep in mind that the standard for obviousness in the U.S. is tipped in favor of validity. As I said before, I believe the obviousness standard needs to be revisited.

I?m afraid the situation won?t improve until Congress is convinced that the system needs to be fixed.

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