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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.
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.
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.
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.