How a rogue appeals court wrecked the patent system | Hacker News Reader

How a rogue appeals court wrecked the patent system

arstechnica.com

163 pointsmacchina40 comments

The second page is really good stuff. Particularly the part about Supreme Court intervention and the need for a specialized patent appeals court. I think the Supreme Court patent jurisprudence over the last several years has been extremely good, and I think the need for a specialized patent appeals court is questionable at best. People tend to think we need specialized patent judges who can understand the technology, but I think this is misguided. Judges are experts at quickly learning the 10% of any field they need to make a decision. Technology isn't any more complicated and in need of specialized judges than say a dispute involving complex insurance or securities instrument. At the same time, generalist judges would be much better at weighing the larger issues of fairness involved in a case. There is a real lack of balance in the Federal Circuit and I think that's partly because Federal Circuit judges don't field other kinds of cases.

The article talks about the idea of the Federal Circuit "overruling" the Supreme Court by gradually chipping away at the principles behind SC precedent.

Interestingly, similar charges have been made of the DC Circuit with regard to the Supreme Court's national security jurisprudence, especially Boumediene v. Bush.[1] (The US Court of Appeals for the DC Circuit has essentially become the US terrorism court — because among other things — they are the only court allowed to hear Guantanamo detainee appeals. But DC Circuit judges do hear normal cases as well.)

So it seems to me the problem with CAFC is not just in its "specialist" judges but also in allowing the law in one field to develop almost exclusively in one court. This also makes Supreme Court supervision much more difficult.

1.http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1838402

That's a very interesting point. Thanks for the article.

It seems pretty clear that something was broken with the old system, before the creation of the CAFC. Plaintiffs were only winning 20-40% of the time.

Considering that

1. the plaintiff is starting with a rebuttal presumption of patent validity,

2. it is the plaintiff who makes the decision whether or not to sue, which should weed out a lot of weak cases, and

3. this was before software patents, back when examiners actually had a deep understanding of the art in the fields whose patents they examined, so there was not a flood of bad patents being issues,

I'd expect in a fair system for plaintiffs to win the majority of cases.

Your assumption #2 is false.

According to the article, a significant fraction of patent lawsuits were being deliberately filed by competitors to challenge the validity of patents that had just been issued. The reason to do this was so that you could choose a venue that was patent unfriendly and therefore gave you better odds of overturning the patent.

Consider the fact that these lawsuits were filed preemptively (they had to be filed before the patent was used to sue you, else you would not get to choose venue), and that they would be filed on the weakest possible patents. One would expect the patent holder to lose a very large portion of these.

I would suspect that a lot of the 80% of wins right after CAFC was due to these cases reaching the CAFC, and it asserting its power over lower courts.

The long-term slide since then is undoubtably due to people pushing the envelope as fast and hard as they can on how bad patents can be, and how broadly patent law can be filed in novel areas (ie ones that Congress never meant it to be applied in).

There were obvious issues in the pre-CAFC era, but I'd prefer those issues over the current status quo.

> Plaintiffs were only winning 20-40% of the time.

They were winning 20-40% of appeals, it doesn't say how often they won overall.

It's hard to say whether 20-40% of appeals is a good number in an absolute sense (percentage of successful appeals is a more useful number) but in this case, it's only to compare with the 50-80% figure that came after the change, and I'd think that is pretty significant.

Good point. I missed that this was just appeals.

I expect exactly the opposite. The cost of litigation gives plaintiffs an unfair advantage over defendants. If a plaintiff wins it's all upside, while if a defendant wins they still lose because they had to pay millions in legal fees (plus the intangible costs of years of litigation).

Given this advantage, and the fact that defendants can always avoid court by licensing if a patent really is valid, I would expect defendants to win the majority of cases that actually make it to court (calling the plaintiff's bluff).

1. That's like saying a law against speeding is valid, so the defendant is probably guilty of speeding. That a patent is valid says absolutely nothing about whether a defendant is infringing it.

2. Sorry, all I can do is laugh. Do you actually follow the US legal system?

3. Again, whether a patent is bad or not has nothing to do with whether it's infringed in any particular case.

1. Read more carefully. I was not talking about infringement.

2. Yes. I acquired a passing familiarity with the US legal system in law school.

3. Again, read more carefully.

1. The numbers you're quoting sure are. Look at the chart and surrounding text again. And all you said was "Plaintiffs were only winning 20-40% of the time.". "Winning" in a patent case hinges on infringement. If you're not talking about infringement, what could you possibly be talking about?

2. That's not an answer to the question I asked, it's an irrelevant and evasive appeal to authority.

3. You're projecting.

1. I was talking about validity. A hint to that effect was that my sentence explicitly talked about the burden of proof of patent validity. To win a patent case, you must have a valid patent and that patent must be infringed. The plaintiff enters the case with an advantage by law on the validity issue, which was the point of #1.

I dealt with why the plaintiff has an advantage on the infringement issue in point #2.

2. You asked: "Do you actually follow the US legal system?"

I answered: "Yes". Please explain how that is not an answer to the question you asked.

You've done nothing to explain how the presumption of validity implies the plaintiff will ultimately win, nor how my analogy to the validity of a law is wrong.

If the answer were really just "Yes", you shouldn't have felt it necessary to bring academic credentials into the discussion, instead of just leaving it at "Yes".

We know from history that extremely weak cases are filed all the time, usually hopes of attempting to force a settlement, and that there have been few effective barriers to such tactics. There were even fewer barriers during the era before the Federal Circuit came to be.

Your bald assertion about "weak" cases being weeded out is contradicted by real-world observations of both the distant past and more recent history.

In most cases I disapprove of flaunting academic credentials to strengthen an argument, since that is just appeal to authority. But in this case I feel it was relevant to your question.

2. Yes. I acquired a passing familiarity with the US legal system in law school.

2. That's not an answer to the question I asked, it's an irrelevant and evasive appeal to authority.

Please stop.

In this case he wasn't arguing that people should give more weight to his answer because he went to law school. Rather, he was responding to someone that asked if he knew anything about the law. As a response to that specific question, giving a context for how much he understands based on his background seems valid.

You never know when the person you're bitching at on HN has a law degree. But now that it's clear that you don't: your objection is silly and the person you are objecting to knows more about this issue than you do.

> 2. Sorry, all I can do is laugh. Do you actually follow the US legal system?

Do you follow it deeper than the propaganda about frivolous lawsuits?

> 3. Again, whether a patent is bad or not has nothing to do with whether it's infringed in any particular case.

He's not talking about particular cases, he's talking about aggregate statistics. A system with a lot of weak patents, where people might independently come up with the same design because it's obvious, is going to have a lot more infringement than a system with only strong patents, where infringement is likely to come from only purposefully copying a design.

> propaganda about frivolous lawsuits?

Oh please. This isn't about ambulance chasers, I'm not some right-wing nut who thinks corporations need to be protected from the unwashed masses. This is about things like patent and copyright trolls.

> He's not talking about particular cases, he's talking about aggregate statistics.

Justice is not decided based on aggregate statistics.

> Justice is not decided based on aggregate statistics.

This is a total non-sequitor. He was talking about the mechanics of lawsuits, not "justice."

This is pretty interesting stuff. For example, I wasn't aware of the "jurisdiction race" that happened when new patent were issued. It puts into context some of the changes at least.

The most depressing, even alarming, part of this is:

> Instead, patent appeals are exclusively heard in DC by judges who live and breathe patent law. Unsurprisingly, this leads to insular thinking. For example, when we interviewed Paul Michel, who served as the Federal Circuit's chief judge from 2004 to 2010, he didn't seem to understand the problems facing small software companies. "If software is less dependent on patents, fine then. Let software use patents less as they choose," he said, seemingly oblivious to the fact that software companies don't have the option to opt out of patent troll lawsuits.

Seriously? The court seems to have no idea of the Pandora's Box they've opened by loosening the "obviousness" constraints.

> This is pretty interesting stuff. For example, I wasn't aware of the "jurisdiction race" that happened when new patent were issued. It puts into context some of the changes at least.

There's still plenty of drama. For example, a few years back, there was quite a fuss over a simple change to the filing date of something on the docket in East Texas:

http://thepriorart.typepad.com/the_prior_art/2009/09/troll-t...

That inventor behind all that mess was quite an interesting fellow, too:

http://thepriorart.typepad.com/the_prior_art/patent_troll_tr...

Sure they do. This Pandora's Box contains cash, for lawyers.

The cynical answer is not always the right answer. You should hear the CAFC judges speak. They genuinely think that the patent system is good for innovation. Most engineers I know, outside the software bubble, feel the same way. They think in terms of patents regulating unfair business practices in the competition between Dow Chemical and DuPont or Lockheed and Raytheon. They think it's a Bad Thing (TM) if they work on a new chemical for 10 years, getting it through expensive and time-consuming testing and regulatory approval, only to have a competitor be able to copy it the minute they release a successful product.

They don't necessarily have insight into the dynamics of how patents function in the software space, but that doesn't mean their actions are just a cynical money-grab.

So you're saying they just don't understand the software industry? I can believe that. I do see a lot of cynical money grabs though, so it's an easy thing to believe.

I think the judges are a reflection of the broader engineering community, and there are big differences in how different parts of the engineering community view the patent system. Look at the background of some of the judges. They're Chem/Bio/EE and worked at places like American Cyanamid and the Naval Surface Warfare Center. My own background is in aerospace engineering and the defense industry, and my experience has been that engineers in these industries view patents very positively. The first think that comes to these engineers' minds when talking about patents isn't Amazon's double click patent, but the patents on vulcanized rubber or HDPE.

More generally, people don't become federal judges because they want a payout. A court of appeals judge makes about $185,000, or about what a third-year law firm associate makes before bonus. And unlike many other civil service jobs, a judgeship is a capstone to a career so it's not like judges use the judgeship as a stepping-stone to a lucrative private-sector position. They are by and large people who genuinely care about overseeing a justice system that facilitates the orderly activity of the economy.

I think most engineers just don't understand how filing for a patent works. They only think in terms of "the company's lawyers are helping protect my work". That's all they know and all they care about. I don't think they are aware that the patents filed sound very silly and probably unrecognizable even to them, when it comes to describing their invention.

Doubtful. It's quite sufficient that their past careers got them into the habit of thinking of strong patents as good, and their friends (who have opinions on the matter) all feel the same way.

Clearly a bit biased but the argument that patent law should rise up through the circuits like any other branch of law is a good one. That is something actionable you could ask your representative to 'fix' (note to would be lobbiests, the best results are when you whine for something achievable, this wins on that basis it "makes sense" (which should patent law be special now) and its within their purview.

I'm glad not to be the only one saying the Federal Circuit defied Supreme Court precedent in State Street. I do think we're a long way from a Diehr/Flook/Benson standard for software patents, though. The Supreme Court is being very careful these days to say nothing beyond answers to the questions brought to them. You won't see any long rants against lower courts like in Diehr.

Uh oh. I understand Europe is planning on introducing a specialist patent court. That could go similarly badly as it is even more likely to be full of patent specialists.

I know this is (re)opening a can of worms, but the interesting part about this article is that it very clearly highlights why it would have been a terrible idea for the recent Apple vs. Samsung trial to be decided by a jury of patent specialists instead of laymen.

It seems that the trouble in Apple vs. Samsung was that one of the jurors thought he was a patent specialist instead of a layman.

Perhaps. I've heard the argument that because he was a patent holder himself, he was able to convince a significant portion of the jury that he was an expert in all things patent-related, and this swayed their decision in favor of Apple. But that's just the rumor machine. We'll see what the outcome of the appeals process is in a few years.

That part of it is not really a rumor; he gave several interviews where he explained in detail exactly how he influenced the jury. All that remains is to see whether or not those statements actually invalidate the verdict.

But in case it's not clear, I completely agree with you: a panel of patent experts would have been even worse. The problem in this case was the judge trusting this guy when he said he wouldn't let his previous experience as a patent holder color his judgement.

Patent specialists might actually have read the rules, at least.

I wouldn't want a jury of "patent specialists", I want an inquisitorial panel including professional judges, laypersons, and technical (not "patent") specialists with the power to actively seek truth out in the open, and I want it for all cases. The adversarial system has overstayed its welcome.

Yet another wonderful legacy of Ronald Reagan.

You can be sure this wasn't his idea.

Few things were.

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