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I absolutely agree that NPEs are not the problem, but I do think that obvious vs non-obvious is the problem, and we'd BETTER make some traction in that direction.

Okay, here's my wild idea of the hour:

AIUI (IANAL, and I've never been involved in a patent application), a patent contains claims and specification. I'm not sure how much this is like C declaration vs definition, but in all the patents I've seen, the claims contain no implementation details. What if, as part of a patent application, the USPTO published the claims in a public forum, and allowed the public to put forward suggested implementations. If any are filed, obviously the patent is obvious. Interested amateurs could amuse themselves by contending, but also competing businesses could protect themselves from trivial patents from their competitors, by allocating paid employee time to monitor patent claims in areas of interest. Admittedly, future market entrants wouldn't yet know they should monitor the area, so it's not perfect.

As for your specific suggestions, rayiner, I think these are similarly not-quite-the-point as the focus on NPEs. I agree that #1 is a "collateral way to attack the problem", but then again so is focussing on NPEs. (After all, how many useful NPEs are there? If the cost of eliminating the parasitic NPEs is the loss of the legitimate drug patent holding company that you describe, I could live with that.)

And as for #2, it's not at all clear to me that it'd be an improvement. Companies would double down on requiring engineers to not read patents, as some companies already do to avoid triple damages. In my ideal world, we continue to stand on the shoulders of giants.

> What if, as part of a patent application, the USPTO published the claims in a public forum, and allowed the public to put forward suggested implementations.

Interesting idea.

> After all, how many useful NPEs are there?

For all intents and purposes, the investment vehicle that funded Spaceship One is an NPE: http://en.wikipedia.org/wiki/Mojave_Aerospace_Ventures

> Companies would double down on requiring engineers to not read patents, as some companies already do to avoid triple damages. In my ideal world, we continue to stand on the shoulders of giants.

I think a lot of frustration with the patent system comes from independent inventions that nonetheless infringe on a patent. The obvious solution is to make independent invention a defense of some sort.

There is a trade-off, as you recognize. The less you can defend a patent against someone else developing the same technology, the less incentive you have to disclose anything that would help them do so. As an inventor, I don't want other people to "stand on my shoulders" unless they are required to compensate me for my contribution. You see this heavily in areas where patents are for whatever reason hard to use. E.g. Intel doesn't use patents on its process technology, it uses closely guarded trade secrets.

Another example of what to me seems like a "good" case for NPEs: Stanford's CCRMA invented a bunch of early synthesizer techniques, and licensed them to Yamaha, who brought them to market. A reasonable division of labor: CCRMA is not well equipped to manufacture and market synthesizers to the general public, but Yamaha is and was interested in their research. In turn, the licensing revenue was fed back into more research in the field. Patents provided the legal mechanism for that all to happen.

A focus on NPEs also doesn't get at the abuse perpetrated by practicing entities. For example, Intel uses its stable of patents (many of them quite questionable) to prevent startups from breaking into its markets: you can only go up against Intel if you're someone like IBM who has their own patent stable to form a credible MAD threat. The aggressive use of patents by practicing entities with strong market positions (in order to stifle competition) is imo at least as big a problem as NPEs are.

>1) Reforms on how damages are calculated. If you neither sell a product nor license IP to third parties, there is no way you're losing any revenue from an infringement. You should not be awarded even "reasonable royalty" damages if you wouldn't have received any royalties in any case.

What stops them just publishing a sham product whose sole purpose is to be for sale while infringing the patent and then show a few licenses to a couple of fishing buddies?

The real trouble with how damages are calculated for software patents is that there is no good way to determine the degree to which the patent was integral to the success of the product, and juries have had a tendency to grossly overestimate their value. Witness Apple v. Samsung.

I imagine your typical smart phone infringes probably twenty or thirty thousand software patents. Even if you assume that every penny of the device's price is attributable solely to patents (and nothing for, say, manufacturing, shipping or advertising), and the device "only" infringes 10,000 patents, the average value of one of those patents against the sale of ten million $500 devices would be $500,000. Which would hardly be even worth litigating over, given that the lawyers cost more than that. But there is no real way to prove that any given patent subscribes to the averages, and plaintiffs will naturally argue that their patent is worth more than all the other patents, and the jury who finds for them on infringement is predisposed to agree on damages as well. So we get billion dollar awards that should be sub-million dollar awards and the trolls get fully funded to buy more radiological weapons and lobby hard for their own continued existence.

>A lot of troll litigation could be shut down quickly if patent infringement functioned similarly to copyright infringement in requiring direct copying.

What standard could you use to prove that? Correct me if I'm wrong, but if I recall copyright is "similarity and access" and for published works "access" is kind of a formality (because everybody has access), which is why the degree of similarity requires a significant amount of specificity. I don't imagine you could find anyone to argue that Chrome infringes the copyright on Firefox as a result of their similarity.

But that's not going to cut it with patents. The intent of drafting a patent claim is to make it as broad as possible while still getting it through the patent office. Any non-mandatory specificity is the enemy. The only way you could give defendants any hope of actually proving that they didn't copy a patent under a standard like that would be to crank the level of specificity required in patent claims up to the point where you'll just have reinvented copyright and called it a patent.

Which is kind of the issue. Copyright works really well for software. The implementation is the hard part, and that is the part that copyright covers. Patents just don't work at all -- because there are so many ways to implement something in software that the only way a third party would ever actually infringe a software patent is to allow it to be so broad that it covers the problem itself rather than any specific solution to it (e.g. shopping cart patents), or covers any implementation that applies the mathematical formula that describes the optimized result for a specific problem dictated by information theory (e.g. encoding or encryption patents).

You make excellent points, but I have a bone to pick with your last one: "Copyright works really well for software. The implementation is the hard part, and that is the part that copyright covers."

Whether design or implementation is the hard part depends entirely what kind of software you're building. Think of something like Google's self-driving car. I can't imagine that the hard part of that is just sitting down and writing the code.

>Whether design or implementation is the hard part depends entirely what kind of software you're building. Think of something like Google's self-driving car. I can't imagine that the hard part of that is just sitting down and writing the code.

That's kind of what I'm talking about. You can't get a patent claim on "a self-driving car" -- and if you do the patent office has failed miserably. Software patents don't cover the overall product, they cover the building blocks you use to make one. And each of the individual building blocks is not the hard part, the hard part is the overall implementation -- assembling them all into a cohesive whole that accomplishes the major goal you set out to achieve.

You want someone who starts with the Google self-driving car and sets out to copy it to have a hard time of it legally, so that they decide instead to do their own independent implementation and have their own costs (and maybe advance the field themselves) so that they can't just undercut Google having done no R&D, but at the same time still make it so that they can do an independent implementation without infringing. Those are the two important criteria.

Copyright pretty well does the first one. If you can't just copy Google's code out of their car and put it in yours, you have to write some tens of millions or more lines of code yourself. And then you have to test it and stamp out the bugs, which is by far the most expensive part of producing software in practice. (I expect this goes double when the thing you're making is a car.) Patents don't really add very much on top of that -- if someone is already doing an independent implementation, having to work around a patent is a small incremental cost, especially if the issued patent is not so broad that it covers the problem itself rather than a specific solution.

Which brings us back to the trouble: In order for the patent system to do anything for software R&D, you can't just have one patent, you need thousands. Which thoroughly violates the second criteria -- now no one can do an independent implementation without accidentally stepping on some fraction of the outlandish number of issued software patents. To clear yourself you have to clear tens or hundreds of thousands of issued patents, but to sue you the plaintiffs need only find a single patent for which you failed to do so. And to shake you down they don't even need to do that, as long as the cost of proving they're full of crap in court is more than the amount they're demanding for a license. These costs vastly exceed any possible incremental benefit over copyright of having software patents at all.

> What stops them just publishing a sham product whose sole purpose is to be for sale while infringing the patent and then show a few licenses to a couple of fishing buddies?

The courts are adept at investigating those issues. For example, Enron's sham electricity sales were discovered once the files were opened.

>Reforms on how damages are calculated. If you neither sell a product nor license IP to third parties, there is no way you're losing any revenue from an infringement. You should not be awarded even "reasonable royalty" damages if you wouldn't have received any royalties in any case.

So threaten to sue a small company that doesn't want to pay for lawyers, and settle for a royalty agreement. Now you've licensed your IP to a third party, and you can sue someone else for greater damages.

Still an improvement over the current situation.

It creates a perverse incentive to threaten businesses with less ability to defend themselves.

> If you neither sell a product nor license IP to third parties, there is no way you're losing any revenue from an infringement.

Well, maybe you're shopping for licensees.

A better solution would be to oblige you to license your inventions at a public auction if you can't find a licensee after a reasonable period of time (six months to a year?)

Licensee collusion at auction should be prosecuted under anti-competitive behavior acts, but probably wouldn't need to be if the auctions were fairly open.

The owner could participate with a shell company and put in an incredibly high bid to block the process... you could discourage this by putting a significant portion of the bid in escrow until the product is actually monetized. If it's never monetized, let other bidders sue for a new auction.

> As a university, they have no business being in the medical products business.

Why? While this line of reasoning might carry some weight if Northwestern were a public university (though I'd still require some convincing), Northwestern is a private non-profit institution, with a highly ranked medical school and clinic.

Supplementing their income with drug sales instead of higher tuition seem like a perfectly logical thing to do.

Because it's a waste. Pfizer has the comparative advantage in marketing drugs, and NWU in researching them. Econ 101: both parties are better off trading.

...and how does the patent help this? It sounds you had researchers paid on a grant, and a drug company that sold the fruits of that research. I am not seeing the case for a patent here at all.

Your dislike of patents does not make NWU a better venue for drug marketing.

Here is a case for patent: a third company snoops in, replicates drugs and sells for higher profit / lower cost since they haven't invested in R&D. Sounds unfair to me and such behavior should be prevented. Patents is one solution. Do you have a better one?

So let me see if I understand you correctly: grant money pays for the research, one company swoops in and markets the drug, then a third company swoops in and markets it, and you think that is a problem?

Yes, because the first "company that swooped in and marketed the drug" paid for the privilege.

How so? Grant money comes from the government, not some private company.

I think I understand what you're saying. Yes, I agree that research funded by the public should be freely available (definitely unpatentable, and maybe uncopyrightable too). I think this is a separate issue, though.

If Northwestern did the research with its own money (which does sometimes happen, I think), then it is good that Pfizer had to pay Northwestern for the research, because this funds more research. The patent is just the legal mechanism that makes Pfizer have to pay as opposed to getting the research for free.

Not necessarily. NWU is a private university, and in general plenty of private companies fund research.

In some cases, the government funding issue is relevant. Not in all cases.

Re. your Lyrica example, is it probably true that the research that lead to the discovery of that drug would never have been done if not for the carrot/stick of a potential sale of the IP?

Perhaps the discovery would have been made regardless and the laws are set up for a few to make a buck to the detriment of society at large (playing devil's advocate here, not convinced this is the case).

Universities don't make a huge amount of money from patent licensing, but it's non-trivial: http://chronicle.com/article/University-Inventions-Earned/13.... Northwestern is particularly aggressive about pursuing patent licenses, and licensing brought in $191 million, relative to $485 million in research expenditures. But for the 155 universities in the survey, total licensing revenues was just $1.8 billion for $54 billion in research expenditures.

However, universities are a piece of a larger system that includes big corporations in capital-intensive industries, federal/state government, and scientists/engineers themselves. Would universities keep doing research if they couldn't directly make money from licenses? Probably. Would the system keep working if the pharma/petrochem/aerospace/etc industries couldn't protect inventions? Those post-docs doing research at NWU aren't doing it for their love of humanity. They're there so they can get a job at Pfizer, Exxon, Lockheed-Martin, etc. Pfizer, Exxon, etc, certainly aren't in the game for their love of humanity. Would Pfizer keep hiring post-docs if some Chinese manufacturer could flood the market with cheap clone drugs within months of Pfizer bringing a drug to market? The government would keep investing, of course, but would they have to invest more to get the same output if they couldn't dangle the patent licensing carrot in front of researchers?

"Those post-docs doing research at NWU aren't doing it for their love of humanity"

[citation needed]

In your experience, what percentage of post-docs work only for love of humanity?

If you want to propose a communitarian moneyless society, so that. Don't beat around the bust.