How To Make The Patent System Even Worse: Make Patent Validity Incontestable

from the are-these-people-serious? dept

There are, as we've noted over the years, all sorts of serious problems with the patent system, especially in how it acts as a toll on innovation, and creates seriously backwards incentives (i.e., you're often better off not developing a product at all, but waiting for someone else to do so, so you can sue them). One of the many problems with the system is the famed "presumption of validity." The argument here is that once a patent is granted, everyone has to presume it's valid. This makes little common sense when you think about it. A patent is generally examined by someone for just a few days' worth of time before they determine whether or not the applicant deserves a multi-year monopoly on the invention. While the examiners may be quite knowledgeable, no single person can accurately understand either all of the relevant prior art on the subject or what is considered obvious to those skilled in the art. In other words, it's common for mistakes to be made. In fact, even the USPTO seems to recognize that it's pretty bad about getting patents right. If you look at the stats, you discover that 92% of re-exam requests are granted, and 3 out of every 4 such re-exams result in adjustments or total rejections. In other words, on the patents that are being asserted regularly (which are the ones where re-exams are requested), the majority of the time, the Patent Office admits it got the original patent wrong.

That would certainly suggest that it's not wise to consider a granted patent "valid."

In fact, that's much of what the current Microsoft v. i4i case -- which is on the Supreme Court docket -- is about. That lawsuit is to determine whether or not the standard used to judge patent validity is too high.

So it seems almost laughable, then, to hear a suggestion that things should move in the other direction. However, some of the patent systems loudest defenders are now proposing that patents should become incontestable after a period of five years, meaning that no one would be able to contest the validity of those patents, even if the evidence suggests the patent was granted in error. It's hard to fathom how this possibly makes sense. The only explanation given is that it would make patents more valuable -- as if they weren't valuable enough already. But, of course, that's laughable. It's based on either confusion about economics or the patent system itself. The point of the patent system is to "promote the progress." Focusing on making patents more valuable suggests these people believe the point of the patent system is to get more patents. But the two things are not the same. Making patents incontestable, especially in cases when a patent is not valid does not promote the progress. It does the opposite.

Filed Under: patents, validity

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  1. identicon
    Walt Smith, 12 Sep 2013 @ 2:47pm

    patent law

    "you're often better off not developing a product at all, but waiting for someone else to do so, so you can sue them"
    this statement describes what is commonly referred to aa a patent troll. In their case the patent is similar to a hunting license.
    I am a victim of this type of individual. We had an item on the market for two years that was already in the common market place for more than twenty years. I never bothered to think about a patent for thast reason. However, when our product became popular in the market we were servred with papers that stated we were infringing on a patent that was just granted that year.
    I called the attorney who served me and told him of my case and he simply said that his client has ordered him to protect his patent and that I should get a lawyer. After calling a few lawyers I got a very quick education in the patent system. After they told me that my case was a slam dunk (I should win easily) they then asked for a $5000,000 retainer and the case would probably cost over $1,000,000 to bring to court!
    This is where they know they have you because unless you are Microsoft it is unlikely you will pay the cost to fight the battle. In our case we rolled over and just closed the company as most do or pay royalties forever.
    however, I was told that if a patent is not used after five years after granting that it is no loner valid. Does anyone know if there is any truth to this?

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