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Companies Asked to Donate Unused Patents
Radon360 writes "There are countless patents that are promising but sitting idle, stowed in the corporate file room. In fact, about 90 percent to 95 percent of all patents are idle. Countless patents sit unused when companies decide not to develop them into products. Now, not-for-profit groups and state governments are asking companies to donate dormant patents so they can be passed to local entrepreneurs who try to build businesses out of them. "
The whole goal of filing tons of patents you won't develop is to wait for someone else to do the work for you. If you donate the patent someone else will complete the work but you won't get to capitalize on their success. (as was I'm sure the original goal)
Take an old, dusty patent that isn't doing anyone any harm, and then give it to an entrepreneur who now has an incentive to sue anyone else whose product violates the patent.
The only reason it's possible to do business in the United States at all is because 90% of patents are left lying in a drawer rather than being rigorously enforced.
Bury them. Let them rest in peace.
Wouldn't it be a lot simpler to make patents only valid while the holder is actively exploiting them
Bingo!
Let's be clear about this, for the benefit of the libertarians: patents (and other forms of protected IP, i.e. trademarks and copyrights) are government interference in the market. They are a form of government-granted monopoly which interfere with the normal operations of a free-market economy. As a matter of principle as well as practicality, this should only happen when the benefits clearly and greatly outweigh the costs -- "to promote the progress of science and the useful arts," as the Constitution defines the purpose of IP law. Granting government protection to unused patents clearly does nothing toward this end.
The correlation between ignorance of statistics and using "correlation is not causation" as an argument is close to 1.
*hilariously, goes and plays a pinball machine called 'Devil's Advocate'*
Ah, those Simpsons. Anyway, problem:
Those patents gathering dust are DEFENSIVE patents. That's why they're gathering dust; they're the deterrent your company has just in case anyone starts violating the patent sharing agreements that prevail between the big players in many markets.
If you donate them to other institutions, they 1) are no longer a deterrent and 2) may no longer be covered by patent sharing agreements. Congratulations! You have plunged the world into an era of 0 technological progress, as companies find the existing patent detente is no longer enforceable.
It would be better to simply grant every company ever a patent on everything possi -- oh, wait, that is the USPTO's actual strategy.
Whence? Hence. Whither? Thither.
Patents are only rights to exclude others from doing something (namely what is claimed by the patent). "Donating" a patent to someone is therefore very unlikely to help someone build a business around it, unless that business is threatening to sue the hell out of everyone else who has ignored that patent until now (because the owner clearly decided not to enforce it). The reason is that it almost never happens that a product is only covered by a single (or even a couple of) patents, except sometimes with pharmaceuticals or so (but those patents are very unlikely to be dormant).
Donate free food here
The USPTO charges maintenance fees on patents. If you do not pony up $$$$ every few years the patent expires. Companies not being in the business of expending cash needlessly do not pay the fees on patents they own but have no interest in develeping. Ultimately this means there will be very few active but available patents to donate to such organizations. In fact the whole premise of the article is nonsense.
The patent was never perfect but the principal and general application was sound. It allowed for actual innovation, protected it temporarily, and offered some transparency in the business world to value novel ideas.
The problem with the libertarian black-or-white view of marketplaces is that humans _always_ screw it up. Not sometimes, always. I imagine the number of people that screwed this one up is relatively small, but isn't it always the few who make misery for the rest.
History shows time and again that all unregulated markets mature to monopolies. From fish mongers to real estate agents, there's rarely an exception. The libertarian view then either accepts the monopoly or performs some logical gymnastics to allow regulation.
The libertarian ideal _will_ be as abused as every other political ideal that has come before it. Please consider a more moderate approach.
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Wouldn't it be a lot simpler to make patents only valid while the holder is actively exploiting them
EXACTLY. How terribly naive to think that those companies that own many "stale patents" would donate their "valuable IP". Those who are truly interested in innovation rather than exploitation will make the effort to get the invention to market (either themselves or through actively pursuing licensing agreements with those that have the capital to do so). Those companies that are NOT interested in bringing the patented idea to market and are not evil parasites are already donating such patents to others (IBM for example).
All that are left are evil, parasitic submarine-patent holding companies. Such companies exist solely to make money without making an effort by holding innovation hostage. Such companies will not donate their IP simply by asking them politely. As you have suggested and I've advocated for quite some time, this illegitimate business model has to be outlawed in some way, and the best way to do this is to introduce the obligation to provide not only the description of the invention itself but an execution/delivery plan as well that describes the intended plan to bring the patented invention to market. The patent holder would be held to that plan, up to a maximum-allowable period of time (whichever is shorter). If the patent holder fails to deliver the patent would be permanently invalidated and the idea would be public domain.
Though much more patent reform is required, this single change would be a big step forward. Amazon may have been evil to file their stupid "one-click-online-purchase" patent but at least they actually brought the idea to reality. Submarine patents run completely counter to the spirit and purpose of patent law, are potentially damaging to the economy and global competitiveness of a nation and must be eliminated.
Maybe small companies where the CEO or CFO are signing off directly on such expenses. But in larger corporations where "legal" is nothing more than a faint blip on the accounting radar, these types of decisions have been lost in the process.
Who is going to go to all the trouble of tracking down which patents in the portfolio are actually not in use (and that would mean completely unused). In a large organization, tracking that down could be nearly impossible, especially when patents are coming from aquisitions, etc. The individual would have to have pretty good grasp of the technologies covered by the patent, the technologies used in all of the company's products (and those of its subsidiaries, etc...), have a good grasp of who in the organization "owns" the patent, the history behind its application, etc...
This would be a daunting and expensive task. It may simply be cheaper to pay the annual renewal fees rather than (a) do the legal and technical research to know that the patent is truly unused, and (b) understand the risk that someone else (e.g. a competitor) could not use the patent against the company giving up the patent.
It's a simple matter of complex programming.
Patents allow the government to prevent freeloading in the market. Millions of dollars of Research & Design money is spent for companies to create a unique product to sell. If another company can simply steal the design stamp a new label on it, and undercut prices due to the fact they didn't have to spend their money on R&D, then no company would benefit from research.
If the whole point is to do some good, why not open the patents to everybody instead of picking some small likely-to-fail company? And while they're failing, nobody else can use the ideas. Not cool.
Suuuuure they will. This should have been classified as 'its funny, laugh'.
... don't hold your breath.
Could companies be more open with them, sure, but *donate*
---- Booth was a patriot ----
Companies asked to donate unused dollars.
Like that will happen
Here will be an old abusing of God's patience and the king's English.
The maintenance fees aren't really all that enormous, though. The first 11.5 years of maintenance total $3200. Also, the fact that 90-some percent of patents lay unused suggests to me that companies will, in fact, maintain patents that they have no interest in.
If the owner of a patent hasn't started to develop it or make it available for licensing within 2 years of a patent being awarded, it should be made available for mandatory licensing with set compensation to the owner.
The inventors of the US patent system didn't envision idle or submarine patents. Their intent was to encourage the creation of useful devices that would actually be made available to the public in exchange for the temporary monopoly on profiting from that invention. Having 95% of all patents idle doesn't fit the original intent.
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