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How Patent Trolls Destroy Innovation
walterbyrd sends this story from Vox:
Everyone agrees that there's been an explosion of patent litigation in recent years, and that lawsuits from non-practicing entities (NPEs) — known to critics as patent trolls — are a major factor. But there's a big debate about whether trolls are creating a drag on innovation — and if so, how big the problem is. A new study (PDF) by researchers at Harvard and the University of Texas provides some insight on this question. Drawing from data on litigation, R&D spending, and patent citations, the researchers find that firms that are forced to pay NPEs (either because they lost a lawsuit or settled out of court) dramatically reduce R&D spending: losing firms spent $211 million less on R&D, on average, than firms that won a lawsuit against a troll. "After losing to NPEs, firms significantly reduce R&D spending — both projects inside the firm and acquiring innovative R&D outside the firm," the authors write. "Our evidence suggests that it really is the NPE litigation event that causes this decrease in innovation."
Fixed that for you.
"Patent trolls" is a propaganda term. It implies that there's a right and wrong way to own patents. In reality it's just that: Owning patents. Patents are a monopoly on ideas. That's the problem.
you need to fix your history line so it should correctly read, under Bush Jr the economy tanked then Obama got into power. I don't support Obama but I do hate it when people try to re-write history.
Patents are supposed to protect specific implementations, not vague ideas. If I patent a widget making machine, someone else can build a different machine that makes widgets in a different way and that's fine. Software patents are the equivalent of patenting the idea of a machine that makes widgets.
Patents are not inherently evil. If I get the idea for a new valve design that uses some obscure property of gasoline to make direct injection engines five percent more efficient then I deserve to be rewarded for that. But do I deserve a reward for taking something we already do and adding "via electronic transmission" without even detailing how exactly that transmission would work? Do I deserve a reward for taking the concepts of HTTP redirects and credit card processing and coming up with a redirect to a credit card processing software?
We have a few problems right now that need fundamental changes to how patents work in order to be resolved:
Firstly, there is a flood of patents far too great to allow patent examiners to examine each patent in detail. We can't solve this by adding more examiners; there's no money for that. We can't solve this by allowing an arbitrary backlog; sooner or later we'd get to a point where you'd spend longer for your application to be processed than the patent would last once approved, which would hurt legitimately useful applications. The current solution, just doing less work per patent, just means that more junk patents come through.
Additionally, we don't have enough experts. A patent on "storing a word processor document in a single XML file" (real patent) might not sound obvious to a patent examiner who doesn't have a deep understanding of IT but to an IT professional it's blindingly obvious; after all XML is a universal format and we store all sorts of other documents in XML form already. Still, a patent has been granted for this "innovation", most likely because the patent office can't afford enough IT experts to properly evaluate every IT patent. (Admittedly, the patent is specific enough that one can, with effort, create a non-infringing XML text document format. But it's still obvious.)
Of course it doesn't help that some granted patents are overly generic. Many patents just declare dominion over an idea, sometimes even without providing technical information on how to make the idea actually work. This can be hard to see for the examiner because of the relative dearth of domain experts.
Compounding that is the fact that willful infringement nets harsher punishment. However, if I actually do the research to make sure I don't violate certain patents it becomes reasonable to assume that I know about all relevant patents in the field. If I overlooked some and end up infringing them it becomes difficult to prove that I didn't know about them, costing me more money. Thus, the safest course of action is to never read any patents at all so I can at least claim ignorance. This keeps me open to surprise litigation, of course, and it also perverts the entire point of the patent system: Patents are not there so that someone can control an idea, they are there so that someone provides his idea and technical work to everyone else in exchange for some royalties.
Fixing this mess won't be easy. We need far more experts, more time per patent and fewer patent applications. The former two aren't going to happen because nobody's willing to pay that much money and the latter isn't going to happen as long as obtaining patents is as lucrative as it is today. While I don't think that killing off the entire patent system is the way to go it's easy to see how people come up with the idea.
USE HOT GRITS WITH STATUE OF NATALIE PORTMAN (NAKED AND PETRIFIED)
A good litmus test for patents would then be: If someone is infringing a patent, but has not read the patent, then the patent is probably much too broad or the invention is too simple and obvious. "First to file" vs "first to invent" becomes irrelevant if patents are required to be highly specific.
If I get the idea for a new valve design that uses some obscure property of gasoline to make direct injection engines five percent more efficient then I deserve to be rewarded for that
No you don't, and that's not what the patent system is for.
If you get the idea for a new valve design, and then go on to develop the valve in a way suitable for mass production, and then start a business selling those valves, then you deserve not to be undercut by rivals who just copy your design and go straight to market without having first paid the R&D costs. That's all you deserve. You don't automatically deserve for your business to succeed regardless of other commercial factors, and you certainly don't deserve money just for having an idea. Ideas are cheap, it's R&D that costs money.
And that is how the patent system is broken, because it directly rewards ideas and not development effort. The positive outcome of the system is just a side-effect of how the system works. The whole system needs refactoring so that it directly achieves the goals above within an ethical framework that acknowledges the value of straightforward hard work over simple ideas. This would mean that a patent troll with nothing more than an idea can't walk all over a company that had the same idea and then spend $10m developing it into a commercial product.
Hm, I don't quite agree. I think a 'use it or lose it' condition on patent claims would be both protective and productive. Oh, and I'd like to see that ideal applied to cybersquatters and their ilk, too.
No, no sig. Really.
ThePromenader
Why should I start a business when at any time a troll could come by with some vague patent, and sue me? Fuck this country, and fuck the government.
> The original purpose of Patents to create a period of exclusivity to regain the expense of research, tooling (and other capital risks), are good.
That benefit can often, not always, be retained by simply keeping a trade secret. The corresponding social benefit of limited patents is that they expire, and the invention is then available to the public.
Unfortunately, the patent office, and the patent system itself, is overwhelmed by software patents. These are by their nature nebulous, aggressive, and often overlapping in complex ways. They also open the doors for, yes, patent trolls, who do no innovation and produce no actual goods or services to the general public. They exist purely as legal entities to file lawsuits based on patents they've purchased, and have no history or intention of using themselves.
The ideal solution is to discard software patents altogether. They are a horrific drain on software design and productivity, not merely due to patent troll losses, but because they force companies to invest thousands or millions of dollars in patent suites to protect from potential patent litigation. And they directly interfere with software authors publishing their work as open source or freeware. The corporate lawyers, and the expense of patent review, cause many companies to refuse to publish even patches to open source, or freeware. There are good reasons the GPLv3 has tried to deal with software patents harshly. They've been a real problem with open source and freeware.
> Fixing this mess won't be easy.
Fixing the mess is at least straightforward. Discard software patents. Their legality has always been questionable, for sound technical and legal reasons, and they're one of the greatest drains on the patent office. They also have profound, demonstrable adverse effects on industry and on innovation in practice.
Implementing that legal and policy change will not be easy, I agree.
Dear Sir:
I apologize for replying 20 minutes late, but I have discovered prior art from ancient Egypt. You can expect Mr. Boundary's counsel to bring this up at trial.
Sincerely,
Damian Yerrick
Owner and Lead Developer, Pin Eight
This example gets trumpeted out in every discussion on patents. First of all, I think most of us here are interested in software patents and maybe to a lesser extent patents on electronic or mechanical devices.
Second... WHY does it take so much money to develop a drug. Is it really necessary? Or is this just the result of the system which people in industry and government have created? This is an industry where the customer MUST buy the product. To not do so is to be sick or maybe dead. That hardly gives the companies involved a lot of incentive to save money. Likewise having seen drugs taken off the market which had been helping me with my own issues better than any other just becasue 1 in 300k people had a bad reaction I suspect regulators are doing little to help matters.
I have a friend who is a nurse, he argues adamantly for the drug companies any time this subject comes up. He talks about multii-million dollar lab equipment he has seen during his schooling which are somehow used in drug research. I wonder why any piece of equipment is so expensive. Is it the materials? Our TVs and cellphones are full of rare earth minerals. Is it the labor? Look at all the labor that goes into all sorts of consumer products. I suspect it's the fact that it is only large drug corporations and universities ever buy such equipment. They expect it to be expensive. they only trust expensive equipment. They have deep pockets. Not many companies make such things and the manufacturers know all of this. I am not a part of the health industry and I don't claim to be an expert in these matters. I only have my suspicions and I freely admit I could be wrong. The more I read about DIY biologists and the lab equipment they make however the more I think I might be right.