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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."
People like this are exactly who need to get involved for things to take a positive turn. Technical folks can bitch and moan all we want, but until the non-techincal start to understand, no, care about, the implications, things just plain won't change.
Wealth creation and true creation are two completely separate things. Creators, in the inventor sense, need to protect themselves from others who would take their ideas without recompensating the creators for the time and effort involved in the invention process.
Investment bankers know how to carve up a company into itty-bitty pieces, charge a fee for that, then move on to dooming the next bright-eyed startup company with two contracts to rub together.
So you are getting the opinion of a destroyer of wealth on how and why to dismantle the mechanism of protecting creators of wealth.
I understand we all hate patents and don't believe in IP, but this is just about the worst you can do in getting a spokesman.
Dancin Santa
This comes across as more of a litigation problem, not really a patent problem. If I invent something, I don't think it's out of like for me to expect to be compensated for it. The problem is, there are too many damn lawyers. We are a litigious society, and that's really the root of the problem here. Why else would there be a warning on the Windex bottle warning me not to spray it in my eyes?
-Arthur
Cave ne ante ullas catapultas ambules
I don't follow - wouldn't a professor of investment banking at harvard be among the first people to realize that something oughta be done?
Schools have to tear down playgrounds because of fears of lawsuits. My kids can't go on field trips without a 4 page medical release. My kids can't attend GYM CLASS without a waiver where we acknowledge that gym includes strenous physical activity.
OB GYNs can't sneeze without ending up in court. People injured in car accidents get millions in settlements.
Coffee cups have "Attention: Hot" printed down the sides of them. Radio ads include a "high speed small print" ramble at the end of them. There is an asterix and small print on everything around me. Half the price of football helmets is to pay for the companies lawsuits and insurance.
The patent system is just another example. The copyright system is just another example.
As a society we need a rework.
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
I don't think it does. Linux is not particularly innovative. Almost all of its features were previously included in another operating system. I can't think of a single thing it does that ought to be eligible for a patent, even in a world where software can be patented.
the summary. I read the article(admittedly I haven't read the book), but the following statement seems to miss the point entirely: In short their book argues that the entire system is a (stunned silence) scam.. Um, no it doesn't. What the NYT article states is that the authors see a lot of the changes made to patent law and how the patent office is funded since the 80's has only rewarded trial lawyers. /., I'm expecting too much I guess.
They don't say that patents should be done away with entirely. They recommend some serious reforms to the system such as a much stricter patent review process where 3rd parties are allowed to have input. They also say that most businesses are more worried about tax reform than they are about patent damage. These are good ideas, and a start to reform.
Gah, I really, REALLY wish people would stop putting bias into their summaries, but this is
Monstar L
There is nothing wrong with software patents, except that when the average product lifecycle is three years the patents are too long for software. I think everyone could be kept happy by limiting patents on software to some shorter term (say 5 years) ... The inventor gets a licensed monopoly for the life of the product - then it becomes public property. This seems to be the easiest way to address the patent imbalance without the costly process of changing the mechanism...
"...that's cause you don't get tenure for using words like 'scam'."
And they told me it was because I didn't have the necessary education, experience, publications, or ability.
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.
There exists a point where economic interests, given a political system which can be bribed, become so powerful that they effectively have total control of the system. As far as the downward spiral of individual liberty at the expense of corporate profit, this is the Point of No Return. Yes, on the books they don't have the power, but practical realities and what the books say are often very different things.
Realistically, the power of the people to speak louder than money is only felt if a) said people are interested in exercising that power at the expense of personal convenience and b) they are willing to think for themselves. This seldom happens, and only when things get Really Bad. I'm not talking about IP laws, I'm talking about not being able to get the basics of life. Abstract economics doesn't get people excited, because its not important enough. Tomorrow's meal or the kid's latest cold is what's important for most people.
As long as powerful economic interests are able to keep most of the people relatively comfortable, they will never have to deal with popular uprising about MP3 downloading or stupid patents. People ignore these things unless it impacts them personally, and it seldom does enough to hurt.
Beyond the Point of No Return, corporate power is able to use the statistics of democracy to run the country. Barring the crumbling of their power due to total economic collapse, they control the media and can use it to influence and placate people as they see fit.
So brace yourself geeks, because we don't have a Voice. We are without economic or political power, and we are so small a minority in the democratic whole we can be ignored no matter how loud we yell. Because most people don't care about what we care about. In a two party system, massive numbers and middle of the road are the order. We are neither.
Which doesn't mean we should just go gentle into that good night, but bear in mind the patent system being profitable to the people abusing it is more politically important than the little (relatively quiet) guy being squashed. If we fight, we need to fight smart and not charge at the problem head on. Because we might as well be a flea going head to head with a rhino.
"I object to doing things that computers can do." -- Olin Shivers, lispers.org
1) These high profile people will convince congress that the system needs change.
2) Business interests will direct the changes.
3) The system will be worse than today.
Profesors of Investment Banking have opinions just like the rest of us. One of the fircest opponents to soft patents that I know is a lawyer specializing in Intellectual Property. Interesting? Yes, but not surprising.
The thing is, having an strong opinion and announcing it loudly causes publicity. Both for the opinion itself, and fhr the one announcing it. Publicity for the one announcing it makes their other opinions noticed too, as well as their ideas, services and books.
I'm not saying that they've got the opinion because it's a means to get the public's attention, but it certainly doesn't hurt their exposure.
That much said, I applaud their stance. The patent system is totally broken and needs to be either thrown out completely or severely reworked.
Before your panties get in a twist, I'm just playing devil's advocate. I think ownership needs to be redefined in both the copyright and patent space. I just see patent reform as an uphill battle because of the simple to understand arguments against it.
The current patent system allows the holder of the patent to have a monopoly on the supply of its holdings for a period of roughly 24 years, with the ability to renew. After that the patent expires, and the information covered by the patent becomes, more or less, open source. Unfortunatly, a company can hold a monopoly on a very vauge idea, stifiling development in a field, and for roughly fifty years. This is just unacceptable.
Should the system of patents be obliterated? No. Without a patent system, industry has no point to develop a product. Now true with our system of consumerism there is brand name importance, and a loyalty to those that produce a superior product; many executives feel that innovation without a garantee of being the only suplier of a nich market is unacceptable.
What could be a simple solution?> Limit the length of a patent to seven years, with eligibility to renew for another seven if a product is developed.
Why seven years? For most products, it takes seven years for the idea of the product, or a compound for medical research, to be aproved to reach the market. With this system a company cannot hold a patent of a vauge idea for decades, hoping for someone to develop a patent in the field of the patent, and deman royalties. It would also prevent a company hindering the development of a field that would render their product obsolete.
This would give the drug companies an incentive to keep developing new products, quickly, and for other companies to patent products that they have already developed. This would also stop companies like Amazon and Microsoft from patent-whoring. Its pretty win-win, and allows more technology to eventually reach an open community, where others can innovate on the ideas, improve the product, and compete with their "better" products.
And they say Leninism is dead.../i?
3 degrees of separation from Vladimir Putin
I didn't see any recommendation for shorter terms for exclusive monopoly rights that I think would help cure this problem on many fronts.
The 17 year term might have been justifiable in the 18th century when trading ships took many weeks to cross the Atlantic, but now, overall progress would be improved if the terms were reduced to something more like 2 years.
And, while we're at IP reform, copyrights should be cut down to a shorter period as well. This 75 year mouse extension is ridiculous, especially when Disney mines fairy tales in the public domain (Snow White, Cinderella, etc.) for their cartoon movie ideas.
But, once the artificial market is created, the vested interests (owners of IP, litigators of IP) don't want to see it go away.
So just reduce terms of exclusivity gradually, a year at a time, until things become sane again.
"Provided by the management for your protection."
Nevertheless, if somebody were so inclined, they could probably get the USPTO to grant them hundreds of patents covering what Linux does. The prerequisite of novelty is not being enforced because the patent office doesn't do effective prior art searches, and the patent holder is not held accountable if their patent claims are later found to be invalid.
Investment bankers typically help perform valuations on private companies wishing to go public. They underwrite the company and sell shares back to the owners of the company. Then with the remaining shares, the company is taken public on one of the many stock exchanges.
What you are talking about are fund managers and loan officers. They are the ones who work at the bank and invest the bank's money. Investment bankers, for the most part, work at brokerage houses and do work far removed from what their title would suggest.
"In fact, medical research thrives on patent protection."
And the third world DIES because of medicine patents.
Nice call there.
"Asterisk" is a little star used for notes.
Pathman, Free (as in GPL) 3D Pac Man
One way to make a significant improvement to the system would be to reverse the way vagueness is handled. At the moment it seems that ideas described in vague and general language are considered to be covered by the patent, and the idea is considered new enough if it is not a blatant direct copy of something that has already been described (which is usually interpreted to mean patented).
If the assumptions were reversed, the vague and general patents that are close to things that have already been done should be eliminated. It seems to me that those are the ones doing the most harm, so this would be a big step in the right direction. If there was a penalty (no protection) for any part of the idea hidden in obscure language, it would make the whole process much easier to use, and harder to abuse. Clear and simple descriptions would be much easier to relate to existing ideas, so you would need real novelty in the idea rather than a novel way to create a convoluted description of the idea.
I think you have missed the point that is actually contained in what you wrote. The problem is not that patenting machines is acceptable but software bad, but that patenting genuinely new ideas is acceptable but trivial modifications is not. I think the reform would be much more likely to succeed if we managed to change the slogan from "software patents are bad" to "trivial patents are bad". If the examination process had better ways to filter out the trivial and the obvious it would go a long way towards fixing the problems.
This is not a one way trip. We are not "doomed" or "fucked." We overcame monarchy. We overcame slavery. We have dismantled patriarchal sexual customs that have 40,000 years of tenure. The progress of our civilization is highly dynamic and we are sitting on a 100 year winning streak.
This did not happen just by sleepy proletarian mobs being occasionally jolted awake by famines and wars. Our progress is the result of small groups of dedicated, intelligent individuals who overcame their own cynicism and defeatism and got their hands dirty. These are not people richer or more powerful or luckier than you that you imagine really take care of everything. This is you. Right here, right now, posting on this stupid website.
Frankly the biggest enemy you have to face after ignorance is helplessness. You are not helpless. Reading recent history is often the best cure for that feeling, and I urge you to read it.
Unhealthy intellectual property policy affects our entire society, through its economy and its quality of intellectual and artistic life. Our patent regime is especially pernicious; software patents in particular are obviously, prima facie unjustifiable.
Oh, we have hot button poltics, and bread and circuses like always. But never forget that money is what really moves politics in this country. And software patents are very, very bad for business, at all levels.
Everyone wants to make money, to push growth. The problem is the prisoner's dillemma; software patents are bad if everyone has them, but they're theoretically good for me (if I'm one giant company). All that has to happen is lining the natural opponents up and letting them work. It will take time; the community needs to develop the conventional wisdom that with software patents everybody loses.
Just be smart, and be willing to work. Once tension builds, it often takes a dramatic event to tip the balance. Say, a bunch of tiny upstarts suing Microsoft for billions over patents and any of them winning?
Want to Know How to Cheat the GPL? Read On!
Last night I attended a talk by Richard Stallman entitled The Danger of Software Patents in Luxembourg. He made a convincing case as to how the patent system when applied to software ideas was poorly executed (a legal mess, scope defined too widely, etc.) He concluded that the patents system on software ideas stifled innovation and hurt Joe Developer while making "the Mega-corporations" (his word) richer. (I won't list his arguments because I'm sure you're all familar with them.)
I accept that the patents system as it stands is far from optimal, or even fair. But could someone please clarify this for me: how could it be an alternative to abolish patents on software ideas altogether when this would remove the financial incentive for someone to protect their software invention? We'd all like to live in a world where financial gain meant less than it does, but is it really a realistic option? What IS the alternative without making the patent system even more cryptic and complex? What am I missing here?
---- scrm
Not only does USPTO not receive any tax money, since 1992 much of the money collected in fees by USPTO has not been available to it. From fiscal 1992 through fiscal 2001, more than $675 million has been diverted. Because of the economic damage cause by invalid patents, this is no way to save money. USPTO's ability to conduct meaningful examinations is already compromised. Last year, USPTO Director Q. Todd Dickinson warned of an imminent "reduction in patent quality" resulting from yet another inadequate budget.
Inadequate USPTO budgets benefit only one group of people -- those who get invalid patents. Everyone else suffers. Fund USPTO so that it can afford to attract and retain highly skilled examiners, as well as maintain a world-class library of international patents, journals, catalogs, and other information. A patent office without full funding is the economic equivalent of a fully loaded B-52 bomber with no maps, no compass, and an untrained navigator.
2. Stop and reverse patentability creep
Would the economy be better off if Bruce Springsteen were allowed to patent rhyming "back" and "Cadillac" -- and sue any other songwriter who did so, even if the new song was nothing like "Pink Cadillac?" Would the economy be better off if the Green Bay Packers were allowed to patent the best defense against a particular play, and sue any team that used that defense against them?
Would the economy be better off if a high-priced defense lawyer were able to patent the use of a legal argument, and sue any other defense lawyer who used it on behalf of his client?
Clearly, the answer to all three questions is no. We're all better off when we can hear new songs, watch good football games, and get a fair trial without getting several patent licenses a day. Unfortunately, several court decisions in the 1980s and 1990s have resulted in the patentabilty of mathematical algorithms and of business methods, which is for programmers just as ludicrous as the above three examples.
Software and business methods patents are examples of "patentabilty creep" in action. Federal judges, legislating from the bench, are expanding the scope of patentable content to not only overwhelm USPTO, but also to do grievous economic harm.
3. Fix USPTO's incentive system to reward quality, not quantity
The Department of Commerce should populate USPTO's advisory committee with members from outside the patent bar, with a view to helping USPTO work toward the economic health of the nation as a whole and not for any special interest group. Employee incentive programs within USPTO should be tied to patent quality, not quantity.
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).
Donate free food here
There are some cases in which being able to patent something is the only way a company will invest the time or resources to develop. Take as an example Esperion Pharmaceuticals, who developed a drug that will save me from all the cheeseburgers I've been eating.
Scientists have known for years that merely injecting someone with "good" cholesterol could help ease congestive heart failure, but because it's something we all produce anyway, it couldn't be patented and nobody was willing to spend the money to manufacture a low-margin commodity.
Somebody noticed, though, that residents of a small town in Italy died with baby-smooth arteries and almost never had heart attacks. A researcher found that they produced a mutant form of cholesterol that functioned like "drano for the arteries." Because it was a mutated form, it was patentable, and the researcher sold out to Esperion, which Pfizer bought within months for more than a billion dollars.
I think people on here, understandably, are coming at this from a software background. There is really no other industry, though, where innovation comes as cheaply and easily. MS et al. have definitely abused the system, but it might be a better idea to militate for software-specific patent reform than for patent reform more generally, as 20 years is not a lot of time in some industries (the airline industry comes to mind, where it takes more than a decade to produce a new passenger jet) to recover the costs of innovation. Another benefit is that the longer the patent lifespan, the longer the period a company has to amortize its R&D costs, and the less they have to charge up-front.
Always a godfather; never a god. -Gore Vidal
The US has to be careful with patent reform, perhaps because of the lesser used part of the 5th amendment. Ie.
... [No person shall] be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.
For the same reason that copyright reform may be difficult to bring about, as postulated by Mr. Lessig, Mr. Knopf, and others, it would literally cost the government a fortune to deprive owners of patents their due value, for a public purpose, as the 5th amendment guarantees them just compensation.
The lackadaisical politics is in essence digging its own grave, ensuring the continuation of a terrible intellectual property system, as the government will be unable to afford to compensate the existing privileged in the name reform for the public good.
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