Have The Courts Done Enough To Stop Patent Trolling?

from the not-yet dept

As we've noted recently, a series of Supreme Court decisions over the past decade, culminating in the big Alice v. CLS Bank ruling in July, has clearly put a serious crimp on the patent trolling business. Vague, broad, dangerous patents are falling like flies, new patent trolling lawsuits are on the decline and the US Patent Office is rejecting a lot more questionable software and business method patent applications. All good news. But is it enough?

There are some who are claiming that the courts have effectively "solved" the problem -- so no new legislation is needed. Of course, it seems interesting to me that these same individuals often appear to be those who insisted there never was a problem in the first place -- and who are also arguing that the courts have gone too far. Economist James Bessen -- who has done tremendous work in detailing the problems of patent trolls -- has an article in the Atlantic where he notes that, for all the positive advancements thanks to the Supreme Court, there's still much more to be done, as plenty of patent trolling lives on:

But don't shed too many tears for the patent trolls just yet. While these changes are a real positive step, they are also limited. While it's true that the Patent Office is granting several hundred fewer business method patents each month, it is still granting record numbers of software patents overall. Most of the litigation is over software patents, not business method patents: One study estimates that business method patents constitute only 10 percent of the patents used in lawsuits by “non-practicing entities” including patent trolls. And while the number of lawsuits has decreased, there are still over four times as many as in 1990, before the surge in software patenting began following court decisions in the mid-1990s. Furthermore, Matt Levy of the Computer and Communications Industry Association told me that in only one case has a victorious defendant recovered legal costs—thanks specifically to the April Supreme Court decisions.

It’s possible that the Supreme Court decisions will eventually have a greater impact on patent trolls than they have so far. For example, the Alice decision pertains to abstract software patents generally, not just to business method patents. It all depends on how the lower courts, particularly the Court of Appeals for the Federal Circuit, interpret and apply these decisions. But that is the very court which has allowed so many broad and vague software patents starting from the 1990s.

Indeed, the efforts by the Supreme Court have been helpful in moving things in the right direction, but so far it's only been a slight course shift, rather than really fixing the underlying problems of the patent system. Trolls are still able to get away with shaking down companies over questionable patents, because it's still ridiculously expensive to fight back -- even if there's a marginally better chance of recovering fees in truly egregious cases. Too many questionable patents are still getting through, and even if courts may finally be more willing to reject questionable "on a computer" patents, it's still a risky and expensive proposition to go to court.

Patent trolling is still a serious problem that many actual innovators face. The Supreme Court may have opened the door to fixing some of the very worst problems, but that doesn't mean all of the problems have gone away. In fact, nearly all of the problems are still there in some form.

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  1. identicon
    Editor-In-Chief, 17 Dec 2014 @ 8:27pm

    Brian and His Thirteen Questions

    To Brian,

    Do you really want answers to your questions? If not, TL;DR. If so, here we go:-

    A1. In today's fast changing and highly dynamic technological environment, patents that last for anything more than 2 to 3 years are simply a burden that cannot be sustained. In many cases, the patents that are submitted to the various Patent Offices around the world are taking longer to process than the viability of the specific patents themselves. The solutions that these patents are deigned to solve end up coming from many different locations independently of the original patent requester.

    A2. There are many, many people who have a requirement for a solution for the same problem and come up with similar solutions. The reward for them is solving their problem and getting on with their various businesses and life. It does not require a patent system to reward them for their idea and implementation. In relation to this, if a solution is thought of by two or more independent people then the idea or solution is not non-obvious and hence not deserving of a patent.

    Trying to just copy an idea has been shown to not be the best method for success. When implementing and idea there is much knowledge that goes into the why of the implementation. Many times this knowledge is not made available even when the implementation is available for copying. I have worked for a number of companies where this mattered. The problem for the companies in question is that even though they had the design manuals for their own products, the reasoning why was not documented. Early in my career, I had a project for one company that looked at why their products only covered specific ranges of properties. It turned out that the original design manuals were written so that they could have a relatively linear design criteria. The gaps turned out to have highly non-linear design criteria. this knowledge had never been written down (as far as I know).

    Companies that do keep this knowledge in-house will usually have a distinct advantage over competitors who have just copied their products.

    A3. If you cannot achieve business success from your idea or solution without a long term monopoly, then it becomes obvious that you shouldn't be (and cannot) running any business for profit. I have seen enough ideas developed wherein the money is made in the first few years. The inventors do not stand on their laurels but keep innovating to ensure that they have a reputation for being the best in the field and being ahead of the crowd. Many of them consider the time and effort in getting a patent as being wasted in relation to making their businesses succeed.

    A4. Since it actually costs a significant amount of money to obtain a new patent, I know a number of people who consider that wasted money. If you can set yourself up as a troll, then there can be a significant pay-off. But as we have seen often, it tends to be shonky lawyers who set up such businesses.

    A5. The patent system as it currently exists is totally useless to one such as myself for getting ideas and products developed. I find that what is non-obvious to one person is generally obvious to many others. I find that it is the person who thinks his/her idea is non-obvious and applies for a patent is usually the one who doesn't have enough knowledge to realise that the idea is obvious to lost of others.

    A6. Who cares?

    A7. Why should he, it is not his business?

    A8. Your question is completely unclear and nonsensical.

    A9. Again who cares?

    A10. Meaningless question - it is more appropriate to ask your local state and federal representatives these questions where it actually makes sense to ask such a question. In any case, you need to answer in full detail all such holding you have first.

    A11. Problems with your question - Cisco is only the patent holder not the inventor. Secondly, if a company cannot maintain an environment that holds onto their staff (by being better than their competitors), then that's a business problem not a problem with patents. Personally, I think that a patent should only be given to a real person and that they cannot dispose of said patent except to relinquish it. This would certainly stop the a lot of the guff that currently goes on.

    A12. Since Google is continually developing their products, even if another company were to hire Google's existing staff to build the same engine, by the time it was implemented, Google should have gone well past where they were at. If it didn't then Google would deserve to have the competition eat it pants.

    A13. As far as I am concerned, the number of patents issued in any year or decade should be very small. Maybe as low as a 1000 per year or say 5000 per decade. Most patents that I have seen are not worth a thing in terms of advancing science and technology and are completely obvious to someone skilled in the arts for their particular field.

    It has simply become another revenue source for the government bureaucracy and does not fundamentally advance anything that matters.

    If I had a dollar for the number of times I have had people say to me that I should patent my ideas, I would be a rich man. However, most if not all my ideas are based in what has gone on before me or are obvious solutions to the problems that arise. I find it far better to share my ideas and everyone gain than to try and gain at their expense. It would be immoral to use a system that is an actual abuse of society to gain an advantage because I could get a monopoly on something.

    If you are worth your salt, you will succeed. If all you have is ideas and cannot implement them because you do not have enough nous to get a good team around you then that's your problem not mine or anyone else's.

    Last point, I know of a successful businessman who has had his product (software source) stolen (he runs a software house) by others who set themselves up in competition. He is still around, they are not. They failed because they couldn't innovate. He has succeeded because he kept innovating. There are others who have been in the same boat and have still succeeded because they could innovate, whereas the competition did not and failed.

    David Oliver Graeme Samuel Offenbach

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