Obama moves to curb software patent lawsuits
nytimes.com
nytimes.com
Yet I haven't seen it in any of the proposals/orders coming about over the years mention this sort of feature. Is there something I'm missing?
A better approach would of course be that the PTO did not 9 out of 10 times create a patent that they later will find to be incorrectly issued. That the state has an 88% error rate when issuing 20 years patents should really not be allowed in 2013.
The data is PTO's own yearly statistics, and is under the heading of issued certificate of reexamination, and one need to compare the period of 2011/09/30 -> 2012/09/30 to get the latest data. A certificate is the concluded decision after all the appeals are done. The statistics cover all types of patents, and all types of industries. Statistics for specific markets (say software) doesn't seem to exist.
The reason I don't bring up unchallenged patents, is that they are of indeterminate quality. The market values them less, and they shares many of the attributes of untested code. It might be good, it might be bad, but until the code is actually run and tested, nothing much can be said. Discussing the quality of untested code seems to me at least as exercise in futility. If we were to try asses the average quality of developed code, would we include untested code too, and if so, how?
On the positive side, patents that are used by entities that try to extract money from patent licensing do tend to get their patent contested. So the patents that are challenged, are also the patents that are in-use at patent suits and patent agreements.
Is that what you are referring to? I don't see it saying 88%
Can you clarify or provide an alternate link?
It would be interesting to make a graph of the issued certificates, and see if for the last ~5 years, the error rate have been improving or worsening.
A judge also has the power to stop a patent from going to trial if some forms of invalidity can be shown, for example if the defense turns up prior art, or if turns out the inventors failed to file within one year of first publication or sale offer.
I completely agree that the primary problem is too many patents issued for trivial, obvious or not-new technology.
http://www.thisamericanlife.org/radio-archives/episode/496/w...
http://www.newyorker.com/online/blogs/elements/2013/06/how-t...
From the article: "It is time to declare total war on patent trolls. The federal government, and the states, should do everything they can to exterminate them and to make anyone regret getting into such crooked work. The existence of trolls is entirely a product of government: they abuse a government program (the patent law), and continue to exist only thanks to government inaction."
It later continues...
"The one exception to the pattern of government inaction is Bill Sorrell, the Attorney General of Vermont, who, two weeks ago, filed lawsuits against MPHJ for exploiting Vermont businesses and nonprofits. He explained to me that Vermont is trying to attract new businesses to the state, and that scaring off trolls might help. “This is not anti-patent,” Sorrell said. “This is anti-abuse of patent rights. We don’t want people preying on Vermont’s small business.”
The Vermont story may help create a race to the top. If Vermont succeeds in scaring trolls away, it will give companies there an advantage. And as more states act, it will be relatively worse to do business in those that don’t."
It covers more than just Vermont and links to other informative resources.
On another note...
A major problem infrequently mentioned is that a lot of people, especially in parts of business far from R&D, see patents solely as a way to recoup private investment, not supposed to be balanced with public interest after limited times, and they use number of patents as a proxy for amount of innovation.
They honestly see the system as it is now as functioning great. Many see objections to patents as objections to capitalism and business. Many of these people aren't stupid, malevolent, or self-serving. They believe in a model that no longer functions, but haven't realized that model no longer applies.
Lots of people in R&D see things this way. My friends in "Big Engineering" are proud of the number of patents they have to their name.
* The original filer of the patent featured in the story was not the inventor of the idea but rather a partner in a failed startup around the idea, which was never realized, he then later patented his former partner's ideas, and made a lot of money from that patent since
* Two defendants fought the patent infringement suit and won on a technicality: the patent was filed improperly due to random mention of another contributor to the idea who was not listed as a co-inventor
* ... BUT any of the other 16 infringements defendants who had already agreed to settle their infringement claims out of court are still bound to the terms of their license agreements forever because the language of the license agreement basically asserts that they have to pay the license fees no matter if the patent in question is still valid or not. So anyone that settled out of court are trapped anyway.
* There is an entire economy and market around reselling patents to the point of the current self-proclaimed owners of a given patent can not describe its origins.
After listening to this episode I couldn't help but think that patents can be fixed if:
1. You should not be allowed to sell a patent. The intent of a patent is to give the inventor(s) enough lead time to develop the idea, not to create a market for ideas.
2. A patent should not be valid unless you can demonstrate it. You shouldn't be allowed to own ideas that are beyond your means to execute.
3. There should be very low limits on patent infringement damage claims thereby removing the financial incentive of using patents and anti-competitive and extortion weapons.
1. If you can't sell a patent, but lack capital or the desire to exploit it (perhaps you have invented something more interesting in the meantime, or alternatively you've developed a serious health condition that prevents you from working), the there's a net economic loss to society because the invention languishes undeveloped for 20 years.
2. You are already required to be able to demonstrate as far as I know. Enforcing this more strictly would allow a different kind of patent trolling by large firms that wanted to grab the inventions of smaller firms/individuals for cheap or nothing by arguing that they weren't sufficiently well resourced to develop the product.
3. If you make patent infringement into an affordable cost of doing business then you're just encouraging people to infringe and pass the minimal costs along to the consumer.
This could be fixed. One approach that comes to mind is to require a sub-20-year renewal process that, if not followed, terminates the patent. This might be due to simple non-execution (e.g. patents held by a defunct company, or entities otherwise unable/unwilling to pursue development), failure to pay renewal fees (e.g. you must pay an ongoing lease on your monopoly right), etc.
I've been thinking along the same lines as you, but (to play devils advocate and help discussion):
> 1. You should not be allowed to sell a patent. The intent of a patent is to give the inventor(s) enough lead time to develop the idea, not to create a market for ideas.
Why are ideas worth nothing? If I have a breakthrough while researching, I'm screwed unless I also manage to form a company with a production line?
> 2. A patent should not be valid unless you can demonstrate it. You shouldn't be allowed to own ideas that are beyond your means to execute.
Would a prototype be acceptable, or does it have to be viable for production? Also, between coming up with an idea and being able to show it as viable might be a reasonable amount of time
> 3. There should be very low limits on patent infringement damage claims thereby removing the financial incentive of using patents and anti-competitive and extortion weapons.
This one feels the most concerning. If the limits are low, then why would anyone bother following them? You could easily make it cheaper for big companies to copy ideas and run with them, then pay people off when they get caught.
Anything that encourages people who have a new, innovative idea to hide it to try and make money is against the original aim.
I do, in general, like the approach though. Maybe there are points along the way:
1. You have a new, awesome, innovative idea. You can get a patent for it.
2. You have to show some working, or viable prototype within a certain time period (short, a few years maybe)
3. With a real example, you can then get a longer patent.
4. You can sell it, but the original time limit still applies.
This way you're compensated for coming up with great ideas (but you or someone you sell it to has to be able to make it a reality soon) and have to release how things work into the public domain (the original intent of patents).
Ideas are worth exactly as much as you can sell them for.
> If I have a breakthrough while researching, I'm screwed unless I also manage to form a company with a production line?
You would be exactly right if you removed "screwed" because it implies that you're entitled to be rewarded for your ideas and not being paid for ideas alone is unfair to you.
You're not entitled to that.
You're not even entitled to be rewarded for actual, hard work (e.g. if you work for a year on software product that fails to sell, you worked hard but that alone doesn't mean someone will give you money because of that).
The problem with patents is that they grant 20 year monopoly on patented ideas and people finally realized that there are very lucrative ways to abuse that monopoly for financial gain, without actually creating any value i.e. if you patent an idea for making an ice cream and don't actually make an ice cream, you can still extract value by suing people who actually do make ice cream, even if they came up with the idea independently, as it usually happens, given that in U.S. alone there are 300 millions of mostly college educated people i.e. a lot of people to come up with ideas.
Another issue with your suggestions: setting arbitrary limits on damages would make patents worthless in protecting truly ground-breaking inventions, like the telephone, for instance.
Too lazy to deal with licensing isn't a good reason to eschew patent reform btw.
Usually when people say that, they mean either hiring more people or hiring better people by paying more.
Given the very low quality of granted patents, hiring more of same kind of people won't help. We'll clear backlog but since the percentage quality will remain the same, we'll just get even more bad patents.
Hiring better people seems more plausible but is also naive.
The biggest problem is that patent examiners have bad incentive: they are judged by number of patents accepted. Since a rejected patent can be re-submitted ad infinitum (after slight wording changes), their best strategy is to just accept a patent. I don't know of any negative consequence for patent examiner for just rubber-stamping bad patents (an example of that would be firing people after N patents they've accepted were found invalid by independent re-examination).
The second biggest problem is that the standard for a patent is vague and apparently very low. In theory patent should be novel and non-obvious, in practice (especially in software) they are ideas that a competent people come up with during regular work and not as a result of some year-long R&D process focused on one problem.
Finally, given the amount of patents it's absurd that anyone can actually do a fair job evaluating them. This is not something that scales by adding more bodies because in order to say whether a given patent application is novel, a patent examiner would have to do linear search of all existing patents to make sure that it's not like something that has already been patented (not to mention the prior art requirement). Even if we limit the amount of data by trying to search only on related topics, the search space is still absurdly large. It just cannot be done well, which is why it's done so poorly.
Obama made statements in February regarding the harm imposed by patent trolls: "On a Google Hangout in February, Obama said patent trolls abuse a system that was designed to protect inventions and foster innovation. "They don't actually produce anything themselves," Obama said. "They're just trying to essentially leverage and hijack somebody else's idea and see if they can extort some money out of them." (http://money.cnn.com/2013/06/04/technology/innovation/obama-...)
Also, the This American Life episode just aired last weekend. I highly doubt the executive orders were written in one business day.
http://www.npr.org/blogs/money/2013/05/31/187374157/episode-...
EFF's effort to find prior art and raise money to fight this particular troll can be found here:
Which of course ignores the possibility that a typical engineer working in this area would assume that the idea is obvious and therefore ineligible for patent. So the ethical engineer doesn't apply, but giganticorp's legal staff pesters their engineering team to patent every possible idea, obvious or not. Which they dutifully do.
Of course, how would the patent office know that the idea is non-obvious to an engineer trained in the state of the art, unless they employ engineers who are trained in the state of the art in every engineering discipline?
Being a part-time patent examiner might be a great job for a retired engineer who remembers all the "new ideas" from the last several decades.
Shit, that is a damn fine idea, friend.
By using a roster of consultants, presumably.
(I agree with the rest of your points, by the way.)
This implies that "the system's image" is the thing he's trying to protect, rather than the livelihoods of people just trying to make a living in a free-market economy. When small businesses are sued for scanning a document and emailing it[1], there's more at stake than "the system's image".
[1]http://arstechnica.com/tech-policy/2013/01/patent-trolls-wan...
As horrifying as it is, I'm actually kinda happy this nasty crap is going on. The best way to get a problem fixed is to exploit it relentlessly.
Now, you say that the issue is associating some sort of risk with people invoking the legal system, but that's a very tricky path to walk down. What if you think someone breached a contract with you, but a court disagrees? Does losing a case inexorably mean you were in the wrong for having brought it?
I personally don't think that penalizing people for invoking the legal system is the way to go. The best solution is to make it cheap to reject meritless cases. After all, anybody could file suit claiming you trespassed on their land, and they could do so maliciously or mistakenly. We don't worry about frivolous suits for trespass because the underlying property right is clear and well-defined, so that if you do get sued it's really easy to show that you did not violate that right. The ease with which a case like that can be dismissed automatically disincentives people from bringing nuisance cases.
The question of which of those will have a larger impact on the economy, and for that matter which behavior we would prefer to see encouraged, remains open and does not have a well-known or accepted answer as you've implied.
I think you mean "companies who sue over patents", not "companies who get sued over patents"; the latter are not the ones looking to prevent copying.
I'd also point out that that issue doesn't apply to software patents, since copyright already handles that issue quite effectively for software.
> Without the possibility of recouping investment, new product development would slow
Standard patent rhetoric. The corresponding anti-patent rhetoric would be that without the issue of spurious patent lawsuits and workarounds, product development would accelerate. Both claims require evidence, not just assertion.
> Which in turn would harm companies that exist solely to copy other products
Because of course the world is divided solely into companies that love patents and companies that exist solely to copy other products.
There's a large ecosystem of innovative companies that treat patents as overhead and cost rather than value.
This is not actually surprising. A patent is a monopoly. A monopoly creates an environment where you can jack up the prices without improving the product you're selling and that's why americans pay much more money for pathetic broadband speeds than majority of other countries, while cable companies are comfortably profitable. It's also why a day after Google introduces 1GB broadband in one area, Comcast or TWN suddenly announce that they also will provide such speeds in this area (but not anywhere else).
Monopoly is what devastating to economy. Patents are monopoly and they are devastating to economy.
But once you max out the return from copying existing innovations, the only way to keep growing is to generate your own innovation. Then you want to protect those innovations. So the U.S., now one of the most innovative economies in the world, has strong IP laws and fights to protect them.
It's true: killing patents would most likely cause an immediate economic burst in the U.S. It would basically be a reduction in cost for many companies, who would realize a benefit in increased profits.
But over time, without patents, there would be reduced incentive to invest in capital-intensive innovations. That is why, despite the studies you cite, every major developed nation has strong protections for IP today. It is why major innovations like broadband, pharmaceuticals, electronics, software, etc. come out of nations with strong IP protections, not nations with weak IP protections
Split discussion, both on the front page.
And what exactly has Microsoft been innovating lately?
"Vermont has one of the highest per-capita rates of issued patents in the country."
What could explain that?
Can someone with more knowledge of US politics explain?