Patents discourage innovation - eh?

Great Debates
21

[QUOTE=Walton Firm]
If I just go ahead and attempt to productise my invention, it is virtually certain that I will be sued by a large number of people who hold patents on video compression, even if there is only a little overlap between my method and theirs. So I first need to search for patents I might be unknowingly violating. Of course, patents are written by lawyers, for lawyers; they are not intended to be understood by technical people. So I’m going to have to hire a patent lawyer, explain my invention to her, and then pay her a lot of money to spend a lot of time searching through the many thousands of data compression patents and investigating every one which could plausibly be stretched to cover my invention.
[/quote]

Actually, you can hire a search firm for a relatively modest cost (at least as compared to a lawyer) to do this stage. If you find stuff that’s close, you may then need a lawyer for the next step of analyzing it, but you don’t really need a lawyer to be messing around with doing the actual patent searching.

I also question that it is really “virtually certain that you will be sued” by many others. You may get several letters inviting you to license patents, but filing suit isn’t cheap and isn’t normally done on spec just in case there might be something there. The lawyers for the other side have obligations to do claim charts and other legal analysis before they can assert the patents.

[QUOTE=Walton Firm]
Also, in the case of the GIF patent, it was actually well-known that Compuserve had a patent on the compression technique. But they never tried to enforce it, and in fact did everything to encourage the adoption of GIF as a de-facto open standard. But then after many years, Unisys, the new owner of the patent, suddenly announced that they were going to take a hard line on “protecting their intellectual property”. In other areas of civil law, I believe (but IANAL) that this is called estoppel: if you allow something to happen openly and with your tacit approval, you cannot then suddenly turn around and sue for damages. But apparently, either the rules are different in the field of patents, or maybe Unisys would have eventually lost a court case but the mere threat of legal action was enough to cause some serious headaches for everybody involved in the field of image manipulation software.
[/QUOTE]

In general, you can’t get damages for patent infringement more than seven years old. Within that time, it depends on circumstances. Even in other areas of law, the concept of estoppel is a complicated one, and whether a subsequent owner of an asset is estopped from asserting it on the basis of the prior owner’s tacit approval is not a slam-dunk for either side.

[QUOTE=Rysto]
Oh, yeah, no problem, just go read all seven million patents that the USPTO has issued and decide whether your product violates any of them.

There exist companies whose entire business model is either licensing patents they own or suing companies who break them. This is not fostering innovation.
[/quote]

Full disclosure: I work for such a company, albeit one widely seen as probably benign. I disagree that we are not fostering innovation, but again, that really goes beyond the scope of what’s appropriate in a GQ thread.

For the seven million patents, first be aware that most of them are no longer in force. Then go hire a search firm, which is not terribly expensive, as discussed above. Sure, it’s a cost, but it’s not as crippling as has been suggested here.

22

I know for a fact that I gave up on my invention (which is great) because the procedure, costs and time it took to try and get a patent was too painstaking and expensive. So now there is an absolutely brilliant invention that is shelved in my bedroom that will probably never be seen by the public because I don’t have the cash. So yes, it does discourage innovation.

23

I used a search firm once. Now I do it myself. I found that it took me the same amount of time to search the patent database using varying sets of keywords (and various company names that I knew were key to the field) as it did to explain everything to the search company and then read all of the completely inapplicable stuff they sent me.

24

One really good example of the ways in which current patent law can discourage innovation is the field of cryptography. It’s well-known that elliptic curve cryptography offers a whole host of benefits over current asymmetric encryption algorithms, but very little research is being done in that field because a bunch of patents related to the use of elliptical curves in cryptography have been granted, and elliptic curve cryptography does not see widespread use despite the huge advantages that it offers.

It’s a difficult balancing act. Research into new medicines, for example, could never be profitable without patents. But in some fields, patents can cause a lot of damage.

25

[QUOTE=Walloon]
U.S. patent law specifically requires that the invention be novel and non-obvious. A patent for an invention that is obvious and non-novel will not stand up to a legal challenge.
[/QUOTE]

That’s the way it’s supposed to be, but there have been lots of “obvious” patents issued recently. The Supreme Court has ruled in on this, hopefully swinging back to non-obvious patents: http://arstechnica.com/news.ars/post/20070430-supreme-court-ruling-makes-obvious-patents-harder-to-defend.html

26

[QUOTE=diggleblop]
I know for a fact that I gave up on my invention (which is great) because the procedure, costs and time it took to try and get a patent was too painstaking and expensive. So now there is an absolutely brilliant invention that is shelved in my bedroom that will probably never be seen by the public because I don’t have the cash. So yes, it does discourage innovation.
[/QUOTE]

There are a lot of valid criticisms of the patent system in the United States, and many of them have been alluded to here. This one, however, makes no sense. If your idea is really that good, all you need is a lawyer to draft you a good confidentiality agreement and then shop your idea around to companies in that field that can afford to get it patented. They pay you cash; they get the patent; the great idea gets commercialized. That’s the way things are supposed to work.

27

Good point, acsenray.

The total cost of getting a patent, including attorney’s fees and government fees, usually runs between $10,000 and $15,000. Commercially speaking, that’s not much.

28

Patents don’t offer any real protection if you can’t afford to enforce them. The guy who invented intermittant wipers had his ideas swiped by the car companies and sued for damages, by the time his case reached SCOTUS, he was forced to act as his own attorney because he could no longer afford one. He won, but the damages the court awarded him were less than his legal bills.

I’ve heard grumblings from folks who’ve patented an idea and before they’ve been able to bring it to market, the Chinese have come out with a knock off (some times even using the text from the patent application as part of the product description). Trying to sue a Chinese corporation is an exercise in futility. Other people have told me that the patent application process is such a PITA that they’ll never do it again.

MIT professor Eric von Hippel has some compelling arguments against rigorous enforcement of patents.

29

[QUOTE=Walton Firm]

If I just go ahead and attempt to productise my invention, it is virtually certain that I will be sued by a large number of people who hold patents on video compression, even if there is only a little overlap between my method and theirs. So I first need to search for patents I might be unknowingly violating.
[/QUOTE]

In several companies I’ve worked for searching for prior art is strongly discouraged, because the penalty for knowingly violating patent is greater than an unknowing violation.

My first two patents involved responding to the patent office on prior art. Almost all the patents filed for by people in my group involved this. The last two patents I got, ten years later just got awarded with no prior art found at all. (And I’m sure there is at least as good a case for it as the first two.) I’ve reviewed patents also, and most of them involved things that were known in the industry long before they issued - and I believe before they got filed.

So, in my experience patents do not hinder innovation if you work for a big enough company to have lots of cross-licensed patents and deep pockets. An effective patent system would fix this, but the one we have now is a mess. But the recent Supreme Court decision does help, I think.

30

[QUOTE=ENugent]
Actually, you can hire a search firm for a relatively modest cost (at least as compared to a lawyer) to do this stage. If you find stuff that’s close, you may then need a lawyer for the next step of analyzing it, but you don’t really need a lawyer to be messing around with doing the actual patent searching.

[/QUOTE]

Actually, once it gets to that stage, in my experience, the lawyer asks us, the engineers, to read the patent to see if there’s infringement, because the lawyer can’t understand it in enough detail to see the subtle differences between we we are doing and what the other company is doing. A tedious, awful part of my job but one that fortunately doesn’t come up too often.

Ed

31

[QUOTE=ENugent]
Once the idea is patented (and usually earlier if it is published), the patent is freely available for anyone to read, including those considering developing in the technology area.
[/QUOTE]
Two really huge problems with this:
[ul]
[li]Patents are unreadable: They are both in legalese, which does not map to any technical language, and they are as overbroad and deliberately vague as possible to make it more likely any lawsuit based on them will be won by the holder.[/li][li]Reading patents triples the damages you are liable for: If the prosecution can demonstrate that you knew about patents prior to ‘violating’ them (that is, developing something vaguely in the same field) the court will triple the damages levied against you. It is in your very, very best interest to not read any patents.[/li][/ul]

32

[QUOTE=Derleth]
Reading patents triples the damages you are liable for: If the prosecution can demonstrate that you knew about patents prior to ‘violating’ them (that is, developing something vaguely in the same field) the court will triple the damages levied against you.
[/QUOTE]

Nitpick: plaintiff

33

It was mentioned in the Economist this week.

They cited an early patent on the steam engine that allegedly strangled its development for 25 years. There was also mention of the US government lifting the patent protection that the Wright Brothers had in place to allow the US aviation industry to pick up pace and that again later US aviation firms pooled patents allowing Boeing to become the largest aviation firm in the world.

I’ll get some proper cites later when I’ve showered.

34

[QUOTE=Derleth]
Patents are unreadable: They are both in legalese, which does not map to any technical language, and they are as overbroad and deliberately vague as possible to make it more likely any lawsuit based on them will be won by the holder.
[/QUOTE]
Between 30 to 50 percent of patents challenged in court are found invalid.

The patent application must describe the

25 U.S.C. §112.

35

[QUOTE=Walloon]
Between 30 to 50 percent of patents challenged in court are found invalid.
[/QUOTE]

Which is great if your company can survive the legal battle. Not so great if you can’t.

36

The Patent Office in Australia’s advice to people planning on trying to obtain a Patent?

Don’t, unless you think you can make a shitload of money off whatever you’re patenting.

Not too long ago I developed a couple of firearms safety devices that might have some economic potential- not a lot, but enough to make it worthwhile to seriously consider building a couple of prototypes and see what would be involved in getting a patent.

Since it basically costs $10,000 to get a patent here, and I don’t have the resources or capital to start Martini’s Firearm Safety Widgets Co., to take advantage of my designs, it’s not economically viable for me to obtain a patent on my ideas.

As has also been mentioned- how would I enforce my patent? Let’s say I do manage to get a patent on these devices, and then Smith & Wesson decide to incorporate them into their latest batch of handguns after reverse-engineering a prototype (not that they’re likely to be interested in my designs, but this is just an illustrative example). What the hell can I do about it? I could sue them, but Smith & Wesson makes more money in an hour than I could hope to ever make off my designs in a lifetime. I wouldn’t have a snowball at the beach’s chance of winning a case against them.

I decided that it wasn’t worth the hassle and expense against the potential return on my ideas, so I didn’t take them any further than the drawing board, alas. Still, if I ever win Lotto or find myself with a spare $10,000 I might dust off the schematics and have a think about going further with it.

37

Innovation isn’t the sole domain of corporations, especially in an area such as software engineering. Any patent process that involves paying $10,000 to $15,000 in legal and government fees is a hopelessly flawed one.

38

Don’t forget that nowadays patents are useful things to have for two reasons
[ul]
[li]Financial Anal-ysts have decided that they are some sort of indicator of innovation, and therefore companies with more patents are more valuable[/li][li]Having a giant truckload of patents is handy if someone accuses you of violating one of theirs because you can threaten them with half-a-dozen semi-relevant ones which will bump their legal bills up enough to wipe out any profit from them shaking you down.[/li][/ul]
so many companies generate thousands and thousands of patents which are basically worthless but sound impressive. They serve no useful purpose (other than to bog competitors down in a sea of paper) and waste frightening amounts of man-hours. Its basically a bullshitting competion.

39

Moved from General Questions to Great Debates.

Gfactor
General Questions Moderator

40

[QUOTE=Si Amigo]
I worked for a Research Scientist for two years who had 20 patents with a major medical equipment supplier. Only two of his patents actually made money for the company (major money). When he would drink he would brag that the other 18 were “defensive” patents and say stuff like “Just think how much I’ve saved the company by stopping other people from working on this stuff!”. And he believed this was true. Just saying . . .
[/QUOTE]

He seems to use the word “defensive” in a different way than how I normally encounter the term, then. Generally, when a company pledges to use their patents for defensive purposes only, that is understood to mean that they will only sue you for violating their patents, as a retaliation for you sueing them first.

Using patents to prevent competitors from entering your market, either by actively threatening to sue, or more subtly by making sure that everybody knows that you have those patents and not promising that you won’t sue over them, would normally be considered offensive use, where I come from.