FTC Investigates Submarine Patents

Schnake writes: "An article on USAToday talks about how the FTC is investigating Sun Microsystems, Unocal, and Rambus to determine whether they illegally kept patents secret while helping set industry standards! And a quote from the ZDNet article: "It noted that all three companies had filed patent infringement lawsuits against firms they say owed them royalties. But the litigation backfired when those firms countersued, charging them with concealing their patents, and complained to the FTC.""

Comments

Patents not secret

[Ed Avis]

The whole point of the patent system is openness. You only get a patent monopoly in exchange for full disclosure. So it should be easy (in principle) to find out what patents cover something you are working on. But in practice the sheer volume of patents out there is too large.

I think that a legally binding 'patent challenge' might be the answer. You should be able to send a letter to Rambus or whoever saying 'I am developing the following... please disclose whether you have any patents or patent applications which cover this area'. The company receiving the letter then has to disclose what they have patented. If they lie or keep quiet, they lose the right to sue you later on. Obviously you couldn't do this for internal R&D, but for standards bodies (where the process is open anyway) this could be a useful tool to reduce threats from submarine patents. The only question is whether it places an unreasonable burden on the patentholding company.

Re:Patents not secret

[pne]

The patent office would then be charged to award the patents with the most merit

Er, I'm sure you've seen examples of some pretty weird patents having been awarded, despite the fact that some people think the thing was obvious to an expert or covered by prior art *cough*One-Click*cough*. Obviously, patent offices are already out of their depth in evaluating the merits of a patent application. What makes you think they will be able to copy with this additional level of scrutiny and evaluation that you're asking for?

Re:Patents not secret

[Asic Eng]

What makes you think they will be able to copy with this additional level of scrutiny and evaluation that you're asking for?

Fair point, but it may actually be easier this way. When you're checking a patent which seems to have low merit (e.g. one-click) you could just say "ok I give this 50 points" (of 1000 possible). It might be easier to compare it with other patents, than to make an absolute check. If you'd compare it with e.g. FM modulation it would be an easy choice to say "this one makes it, that one doesn't".

Another hope is, that companies might focus on their important stuff, and throw out the crap, because:

• the crap doesn't make it, and is therefore a waste of money
• if it makes it, it might delay their important patents

The important point for me is, that the patent office would be forced to do some quality assessment, whereas now they seem to take the easy way out, and award anything... In the worst case we'd just have less bad patents. :)

Re:Patents not secret

[mce]

As far as volume goes - maybe there should just be a cap on patents. Something like "x patents a year can be awarded".

You've got to be kidding. Such a system could mean that a company cannot patent anything between, say, July and December, only because its competitors filled up the cap with "bogus" patents during the first half of the year. How long before the latter becomes a generally applied strategy? Smells like a preprogrammed denial of service attack to me.

Re:Patents not secret

[Asic Eng]

Hmmm, I see you point, but that's not quite the implementation I was thinking of.

Using some unrealistic numbers for an example, let's say 1000 patents would be granted per year. Than at the end of the year the 1000 highest valued patents come into effect, the rest remains in the queue. Bogus patents wouldn't be rated high and never make it to the top. (Well, if they are rated correctly, that is.)

Say the scale was 0-1000 points. A patent reviewer assigns a value to a patent. A good application rates in the 900s, a bad one in the 50s. In one year the threshold might be 910 (because 1000 patents were in the queue which were rated 910 or higher) in the next it might be 850. Which means the patent you submitted last year which rated 905 was now approved, too. (It would stay in the queue with the same value.)

Submitting lots of 50s applications would just create more work for the reviewers. Probably not a big deal, since there is a fee attached.

Re:Some others worth investigating perhaps ?

[troc]

That's fairly difficult as by steering things in certain directions you run the risk of revealing your ideas before they have been patented, thus increasing the prior art out there and reducing patentability.

Patents were designed to do two things. One was to foster innovation by FORCING disclosure of invention (or runing the risk of having secrets stolen) and thus adding to the sum of knowledge. The other was to protect the inventor so they could profit from their invention. This is why patenting is relatively cheap (here in europe the initial patent fees are substantially below the cost to the office of dealing with them) but the recurrent annual maintainence fees increase almost exponentially towars the last few years the patent can be valid - to dissuade the patentee from holding the patent too long, especially if it turns out to be a pointless patent they aren't making money out of.

Hohum

Troc

PS Yes I am apatent examiner ;)
PPS Here in europe you can't patent software or business methods.....

How can a patent be secret?

[dpbsmith]

How is it possible to keep a patent "secret?" Aren't all patents part of the public record?

Re:submarine patents...

[the_ph0x`]

So, just remember, patents don't protect the inventer. Patents exist to the benefit of corporate america and the us government...

Actually I would slightly disagree with you on this matter.

Patents do a great deal to keep control of an idea/concept/plan/what-have-you for even single people. It is like all things that have come from the US so far, it started off as an excellant idea, but from there we grew as a nation and as a planet, however the systems we put in place have not. And that is the problem with not only the patent system but many other aspects of our life.

Re:patents, the US way...

[Lonath]

On a side note, monopolies are legel, abused monopolies are not. Patents grant legal monopolies, abuse of patent should be prosecutable (think of
Brazil against pharmaceutical laboratories, selling remedies 10 times their costs. If it's not an abuse of monopoly, what is?).

Sure, 10 times the cost of making that one little pill, but it costs a lot to develop the drug and then you have the interest on those costs piling up for years before any revenue comes in, and you have the other failed drugs that they try to make but that never work or kill people or whatever happens.

BUT...I do agree with you, and personally I would do something like this: Make licensing fees proportional to the average incomes of the nation the drugs are being licensed to. That way, rich nations pay a boatload, and poor nations pay very little, and it is based on their "average" ability to pay. and if the costs aren't being covered, then raise the prices on everyone so that the rich nations have to pay much more proportionally.