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More Calls for Patent Reform
ibi writes "On the heels of the PriceWaterHouseCoopers report about the threat of SoftPats to innovation, comes a book by a Harvard B School and Brandeis economics professor about how broken the patent system is in general. In short their book argues that the entire system is a (stunned silence) scam. (They actually call it 'a creator of litigation and uncertainty that threatens the innovation process itself' instead but that's cause you don't get tenure for using words like 'scam'.) Interesting to see that its gotten so bad that a professor of Investment Banking at Harvard even thinks something oughta be done."
You have a strange idea of investment bankers. Where I come from, they are generally people who invest their bank's money, usually in a business they foresee as being profitable. Asset stripping is not usually part of the process.
Does the Patent System Need an Overhaul?
By SABRA CHARTRAND
Published: September 27, 2004
SINCE 1793, the federal government has issued patents to inventors, giving them exclusive ownership of an idea as well as the right to prevent others from using it. Now some experts argue that achieving those rights stifles innovation. Two professors conclude in a new book that a couple of unrelated and seemingly innocuous administrative reforms of the patent system have caused a shift away from encouraging innovation in favor of exploiting patents largely for lawsuits. Josh Lerner and Adam B. Jaffe have written a book with a title: "Innovation and Its Discontents: How Our Broken Patent System is Endangering Innovation and Progress, and What To Do About It," to be published in November by Princeton University Press.
Mr. Lerner, a professor of investment banking at the Harvard Business School, and Mr. Jaffe, a professor of economics at Brandeis University, trace this breakdown to the early 1980's, when a single federal appeals court was established to hear patent lawsuits, replacing 12 regional courts of appeal. Then in the early 1990's, Congress changed the patent office's financing, so the agency could pay for itself with user fees. From his home outside Boston, Mr. Lerner last week described the patent system, 20 years after the reforms, as mired in "the land of unintended consequences."
"Again and again in the patent system, we see people set out to do reforms with one thing in mind, but that have quite an unintended effect," he said. "The easier it became to get patents, the more people wanted to apply for them, and that led to a situation where examiners grappled with more patents to review, which led to them being pressed to do quicker reviews and a degradation in quality of patents issued." The patent agency has often struggled to keep up with the times. In recent years, the agency has confronted entirely new areas like biotechnology, software-related inventions, financial and business methods, Internet-based inventions and other information-technology innovations. Some of the changes designed to deal with these occurred amid extensive public debate. Others got little attention because they seemed like innocuous administrative reforms - like the ones that made patents easier to get, Mr. Lerner said.
But many of those patents caused a secondary reaction, he added. "The ability to litigate and expect to get substantial award from litigation increased," Mr. Lerner said. "So as a result we've got somewhat of a vicious cycle. Once you get one firm in an industry beginning a strategy of aggressive patent enforcement, it creates an almost inevitable response - an almost arms-race dynamic - where everyone else in the industry says, 'We better be doing the same thing.' " He suggested that these changes for the worse occurred because "there's a relatively small group of people in the D.C. patent bar, and they have a very powerful influence on how patent policy gets decided. There is a powerful incentive for them to keep a patent system that is complicated, and one that involves protracted, costly litigation." Also, Mr. Lerner said, businesses often fail to understand the importance of subtle changes in patent law.
"It is perhaps because of the complexity of patent issues, and because there is no long tradition of work by economists in this area, because a lot of corporations see it as second order relative to tax policy changes, for example, which directly affect their bottom line," he explained. "Patent policy has an indirect affect." The book lays out a strategy. "Our idea is that three things will potentially make a big difference," Mr. Lerner said. "First of all, this idea which may well have made sense in 19th century of a patent examiner being able to sit and in few hours figure out what a relevant technology is, and then go out and make a decision as to whether a patent should be granted or not, that really doesn't make sense in an era like today. "Second, to see the patent revie
But will it help?
Even if the patent system is reformed, who's going to make sure a new system isn't dictated by the robber barons who own congress.
I bet the a system would favor the current corporate patent holders with large patents portfolios, while reducing the power of smaller IP-only parasites (EOLA, bellboy etc.).
- Ost
---- Sig. gone.
"Asterisk" is a little star used for notes.
Pathman, Free (as in GPL) 3D Pac Man
It has nothing to do with "technical fields", except in the TRIPs treaty (which is why the European Parliament simply stated that "data processing does not belong to a field of technology", although of course the means with which you perform data processing can).
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This morning I saw an article in the SD Tribune touting how benificial patents were to the biotech industry from the perspective of a lawyer. I wrote this reply to the author before I even saw this on slashdot .... must have been a psychic thing! :)
To: michael.kinsman@uniontrib.com
Dear Michael Kinsman,
After reading a recent article you wrote in the Union Tribune, I really think you should consider the "other side" of the Patent system. I found it ironic that the article I'm thinking about referred to a lawyer, because of all people - a lawyer is probably the least qualified to understand what's good for technology industries and what isn't. In fact, even in the article, the lawyer referred to, defended against patents in one case and imposed them in another. Lets face it, when all is said and done, the people that benefit the most from this two way milking process is lawyers and not business. I don't work in biotech, but I've worked in allot of other technology companies and this is the way I see it:
In the tech industry I know, most people get patents not because they are some glorious protection, but rather a glorious hassle that is necessary to use defensively against frivolous lawsuits. They are also used to get into cross-licensing agreements that would have otherwise made it impossible for the small innovative companies to compete against entrenched patent and lawyer filled giants. This is hardly the patent system that helps the small inventor working in his garage that everyone talks about.
In the tech industry I know, the entire industry is defined by people who defied patents. For example, the IBM compatible PC was a drastic success for the computer industry, because it was a drastic patent failure where anybody could make an IBM compatible PC even if they weren't IBM. Silicon valley, wouldn't exist without the engineers who routinely revolted against companies who wanted to patent off their innovations, and created new startups in defiance.
In the tech industry I know, the overwhelming majority of patents were issued for innovations that were incremental, and were going to happen anyhow with or without patents. The patents didn't help anything, they just got in the way time and time again. Even worse are the thousands of patents issued for things that were obvious and could be made by any competent high school programming student, like a cursor that blinks!
One time I worked for an innovative startup that got bought out by a huge global multinational corporation - whose only motive was grab some key patents and lock out competition in an important area of the market. This didn't benefit the consumer who got gouged, it didn't benefit the employees who mostly got laid off, it didn't benefit the tech industry who was cut out from using the technology, and it stopped the innovation that was going on cold in it's tracks. But, on the bright side, it did benefit greatly a large staff of lawyers on hand!
However the most revealing patent issues didn't happen in the IT industry at all. It happened when American pharmaceutical companies tried to sue the daylights out of dirt poor African nations who wanted to make generic AIDS drugs on their own. And then how pharmaceutical executives went to the papers and said how they had no incentive to make pharmaceuticals without these lawsuits, that their patents were property, and they were very generous to Africans. Of course when it was pointed out that those points were very similar to the incentive/property/generosity arguments used by plantation masters in the 1800's - they backpedaled in a hurry and got the government to put 13 billion of my tax money towards fighting AIDS in Africa instead. (buying patented pharmacutical products, of course)
So the questions you should be asking is not whether patents are beneficial to the industry or not, or whether they will secure venture capital, bu
Here's a relevent bit in the US constitution:
Unlike natural rights, people don't have exclusive rights to their "writings and discoveries" unless Congress grants it. The reason Congress grants that right is for the public good. If Congress chooses not to grant this right, it isn't taking anything away. It's just not exercising it's power to grant the right. And there's no "property" taken from the inventor in violation of the 5th ammendment.
-Dave