How to kill trolls and influence Apple people: A patent solution Having decided that the patent problem is an attempt to solve a public goods problem, as we did in part 1, let's have a look at the specific ways that we put our oar into those perfect and competitive free markets. It's worth just noting that patents and copyright are not, absolutely not, the product of some fevered free …
If we pretend the curve is accurate, deleting the entire patent system keeps innovation at the same rate, but has a bunch of other advantages: the courts are not backlogged with patents cases and all the patent examiners and patents lawyers are free to to something constructive instead.
In the real world, being first to market is an advantage. If your first generation product is copied, by the time the copy reaches the market your second generation product is ready to protect your market share. If on the other hand you invest in patents instead of a second generation product, delays and legal fees will bankrupt you before you get a penny from the copycats.
Finally, the idea of the patent system was that in return for getting a monopoly, you published how your invention works. There is so much dross that an inventor is unlikely to find a relevant patent. There is no chance he will understand it because it is written in patent language, and if he gets it translated the chances are he will find the invention is not adequately described anyway. Inventors do not read patents unless they are being sued - partly for the reasons just given, but also because reading patents makes inventors liable for triple damages.
I am all for using existing laws for reducing the patent problem prior to abolishment. IANAL, but I suspect demanding licensing fees for non-infringing products is fraud, and asking for settlements scaled to the cost of defending against nuisance litigation is racketeering.
First to market is at an advantage?
That ignores global markets and the inability of any regular sized company or innovator to release even a modest product world-wide all at once.
For less modest products production is to expensive for many innovators. Consider ARM, the CPU architecture designer, they could not exist without patents.
Eliminating the patent system completely would aid only mega business.
The patent system (especially in the US) needs overhaul, but not elimination.
You are demonstrably wrong about global markets. If the Rasberry Pi Foundation had wasted money on patents, and MegaCorp had copied the Pi, the foundation would have nothing but legal bills while MegaCorp would have product revenue and could cause delays and appeals for years. Instead, the foundation did launch a modest product world-wide all at once and have sold over two million.
ARM would do fine without patents. Their designs are protected by copyrights. If the patent system disappeared, Apple and Samsung could make ARM compatible CPU's by recreating all the verilog, building a batch of CPU's, finding the bugs and repeating until they either get it right, or stop throwing money down the drain and license ARM's tested and working design.
BTW: Try downloading ARM's (or Intel's) patents and putting them into a verilog simulator. The result will be a big list of errors, not an emulated CPU. The patents do not disclose anything of value.
>>In the real world, being first to market is an advantage.
>
> Something of a myth, I fear. Far easier to learn from the mistakes of the first mover.
That's still not a problem. Progress will occur rather than everyone being stuck in a 20 year quagmire waiting for some patents to expire. The current market leaders benefit from this despite whining that others want to do likewise to them.
There is a story told here in The States to remind our manufacturers that they no longer rule the world. One of our wire manufacturing companies created a new thinner wire that required significant advances in tooling technology. They proceeded to send samples around the world to show everybody what they had done. Before they had their manufacturing line tooled and running the sample from Japan came back. It had been threaded with a smaller wire.
Being first to market is also clearly not beneficial in places like pharmaceuticals. The cost is all in the research and testing. Once you've got a sample it's fairly easy to break down and synthesize the drug. With no research and testing costs to recover, you can undercut the originator's price a hundred fold.
From watching people develop software for the last 35 years I'd say patents have a far more debilitating effect than just bringing innovation back to the point where its on par with no patents. That may have been the case with hardware but with software the cost of 'an invention' is merely a library call or two and not a whole production line. I've spent three months working on a patent application for a company where the software to implement it was written during a meeting.
I wonder how many ideas and innovations have been scraped because the cost and complications of patenting are too expensive and how many ideas and innovations have been scraped because the risks of infringing on some unknown patent are too great.
Software is protected more by copyright than patent. Frankly, in most cases I think it should be patent not copyright, both for the shorter time and the ability to challenge the protection. There are few instances in which I can see software requiring more than 15 years of protection, in fact I think 7 should be the mean. I'd be willing to flex and make it more like trademark: you can keep it so long as you are supporting it.
But that sort of change will never make it through Congress.
Wonderful article.
I only see one problem, that being the length of copyright protection is too long for what it currently covers and would also be too long for software. It has evolved evolving from 'life + 20 years' to 'life + 95 years', and there is significant lobbying to lengthen the duration even further.
Amen! Really good writing (movies, etcetera) will still be around when the copyright expires -- but everything else will have gone out of print and been forgotten. There are a lot of books that deserve better, but reprint is impossible because the copyright-holder is either unknown or unavailable.
Now imagine that happening to an algorithm.
"A patent protects what you do / copyright protects how you do it".
That analysis is too shallow to help us move forward here. A patent has to protect a specific way of doing something, even if the specificity does not go as deep as in the case of copyright.
Otherwise, I can patent the "cure for cancer", the mere idea of curing cancer, before anyone actually finds a working cure for cancer.
quote: "Otherwise, I can patent the "cure for cancer", the mere idea of curing cancer, before anyone actually finds a working cure for cancer."
You can patent a process (the method of doing something), so yes, should you feel inclined you could brainstorm a few possible generic cure vectors and then patent the process.
e.g. "A process whereby a Destructive Pathogen (A), is introduced via a Deployment Vector (B), such that it can come into contact with the tumourous cells. The Destructive Pathogen (A) is protected by a Deterministic Matrix (C) which provides a Method (D) of determining the presence of tumourous cells. When in such a presence, the Deterministic Matrix (C) releases the Destructive Pathogen (A) allowing it to target and destroy the tumourous cells."
Pad that out with enough legalese and I reckon you've successfully stifled at least one way of fixing a global problem. Go go submarine patents! :)
The problem with patents is their value is based on how useful the 'invention' is.
The aim of the patent system is to encourage invention and sharing of the resulting knowledge. To adequately encourage invention the reward needs to reflect the amount of effort and expense that went into invention not how much money can be made by exploiting it.
I suggest patents should be filed with a claimed value representing the effort and expense that went into the invention and that value may be challenged. The holder would be required to give full and transferable rights to anyone paying the claimed value.
That would get rid of silly round corner patents which couldn't claim more than a few hundred $ value while the likes of big pharma investing millions in R&D could easily claim million $ values.
I agree, and have previously proposed a similar idea. The main problem is that true innovation is hard to measure as effort and cost: If you have a flash of inspiration and find a truly ingenious solution to a problem, what is your cost and effort? Do you count all the non-productive hours where you didn't find anything of value? Do you count all the time you used to educate yourself to the level where you could understand the problem (and its solution)?
Patents have meaning in two situations: 1. Where a product has cost a fortune to develop and test but is easy to copy (such as medicine), 2. Where a simple and ingenious solution is found to a product -- something that nobody had seen before, but is obvious once you see it. Your idea works for the first kind, but fails for the second. So we should have two different ways of protecting IP: One that covers expensive development processes and one that covers ingenious ideas. The first kind could easily give exclusive rights until the documented expenses including interest rates (plus, say, 50-100%) have been earned back through profits or licensing. The second kind would need some other mechanism that is a lot harder to make fair. It could be done by making a panel of experts in the field rate the innovation of the solution and assign a value to it. Until that value is regained, the inventor keeps the rights. It should still be possible to challenge the rated value, for example by pointing to prior art.
Speaking of prior art, a major problem is that patent offices only search previous patents and not scientific literature. So patents are often granted for things that have been known in scientific communities for ages, but never been patented. These patents can be challenged, but it is far too costly to do so. Maybe patents should have a trial period: Anyone can, for a modest fee, indicate prior art. If the prior art is accepted, the fee is returned and the patent invalidated.
"Where a simple and ingenious solution is found to a product -- something that nobody had seen before, but is obvious once you see it."
I don't see that as a problem. The number of ideas which no one has ever thought of before and isn't likely to in the near future are almost zero and that is much more the case than it was a century ago. People are going to have simple ideas anyway - the lack of possibility of making a pile of money from a simple idea isn't going to stop people thinking them or cause them to forget or keep them secret.
I don't mind the assessment of claimed values being generous and reflecting effort and costs put into other bad ideas.
People seem to think if they have one good idea they deserve to get rich from it, like having ideas is some kind of lottery with a jackpot - they don't it is the flawed patent system which has produced that kind of thinking.
""Where a simple and ingenious solution is found to a product -- something that nobody had seen before, but is obvious once you see it."
I don't see that as a problem. The number of ideas which no one has ever thought of before and isn't likely to in the near future are almost zero and that is much more the case than it was a century ago. People are going to have simple ideas anyway - the lack of possibility of making a pile of money from a simple idea isn't going to stop people thinking them or cause them to forget or keep them secret."
I disagree with this reasoning with the following example.
When Jimmy Carter was running for the White House he made a comment about having been so busy running that he hadn't been able to sit back and have "an original thought" in some time. That statement caught my attention and started me thinking about whether we ever have any "original" thoughts. I came to the conclusion that, in fact, we do. The best way I can express that is to remind the writer above that the pace of intellectual (and technical, etc.) advancement has been accelerating throughout history and continues to this day. Some of that is because we have more people than ever before, but is probably better explained by more "original" thoughts or ideas, and building on the previous knowledge that has been gained throughout history. What do you think?
Equating cost and value seems unfair.
Innovation is risky. For innovators to survive, one successful product/idea/patent need to pay for n failures.
Cost is intangible. My painting of a vase of flowers is worth less than Van Goghs, even though my paint cost more and I spent longer at it. Experience, genius, and name recognition are hard to account for.
Lots of air has been spent talking about the quality of patents, and I agree, most are horribly arcane, vague, trivial, or even completely deceptive, but we need to start at the back end.
I believe a patent should require no more than 2 full pages to describe fully, with additional articles added to specify applications for it, for example: a waterwheel "invention" might specify it's function, spinning in connection with water, but then to clarify for the layman in regards to it's assertion, add an article to show it's potential use as a power/work generating device, and another article showing it's potential being a rotary paddle when the power/work is generated by something else... this is a crucial bit I'll get to below...
Now the back end argument is simple. Today, we have DJ's and remixing "artists" who have never invented a sound, and are able to produce new works of "art", they are allowed to sample, modify, and reproduce sounds to form new tracks. I know the negotiating with the various rights holders can be tricky, publishers, authors etc, but in a patent situation, this needless division wouldn't exist (or maybe it should? manufacturers patent vs scientific patent?)
So let's say patents are as they are today, complete and total rights to an idea, except that we add a compulsory licensing system, so that anyone who wishes to use a given patent in a derivative/inventive way can (ie. not directly competing). Then the "application" article appended to each patent would be critical to enforceability, every intended use would have to be spelled out to be covered (amendments could be made to add more of course), and the rights to it would stop there.
Therefore, if someone were to invent a whole new application for a patent, they could enjoy patent protection for themselves, with a mandatory licensing fee or royalties to the original patent holder (there could be a standard FRAND scale here) ....
Imagine someone named George invented a food processor, based loosely on a patented propeller designed for aircraft and boats originally, but the patent had never listed that as an application, then George could file an amendment to the original patent with his application of it. This would ensure his "invention" or "novelty" is permanently associated with the original patent, and the coverage of his rights is clear to everyone, and he would be free to assert ownership to that application of it only, provided he maintains his licensing of the original patent....
And perhaps the best part for the existing patent owner, if George's business ever defaults on his licensing scheme, or goes out of business, the original patent holder can file an amendment to assume ownership of the application.
Now how do we make this happen? :)
Horrible idea.
In remixes, the samples came from somewhere. If you have decent record-keeping, you could trace where your sample came from, because it definitely did not come from you. Or you can make your own sounds, and then nobody could assert a copyright on it.
We are deluged with low-quality patents. You can't use them to build anything. You can only invent your own thing, and then get sued by a patent troll. You can't use good record-keeping to track what inventions you're using, because they're independent inventions. And then patents that you never knew about will appear and sue you.
I'm not entirely pleased with music licensing, either, but that's a different story.
Way back when I was involved with this stuff, I recall the major shift when Examiners were told that applicants were customers and they should be customer-centric. The philosophy changed from "Why should your claims be granted?" to something much weaker. Hopefully, the old ways may be returning.
I think Tabarrok's curve is over-simplified. If the quality of patents themselves is raised I think you get more benefits from stronger protection, and if the quality is lowered it all goes to hell. (This assumes that "strength of patent law" is not another phrase for "patent quality".)
Loser pays, I think it would be nice if there was some nuance there for small entities (this appears in other parts of the patent process). You rarely go trial with certainty of victory -- if Tiny Inventor goes up against Rapacious MegaCorp, loser-pays allows RMC to intimidate TI merely by overspending on defense. A 10% chance of being on the hook for $500k is one thing, a 10% chance of being on the hook for $5M is something else (and accounting rules being what they are, RMC could easily "spend" $5M without it actually costing them $5M). Perhaps, "loser pays, not to exceed 3x own legal costs" or "one suit per year, loser does not pay", with appropriate RICO statutes used to swat down the rats' nests of LLCs that are usually constructed to game such rules.
I really do think that the issue with software patents is one of quality (disclosure: I haz some). Depending on where you set the knob for "obvious", there might be more software patents, or fewer. I don't think we need to lower the bar, but they're not all crap, and they're not all part of the "half-dozen wonderful ideas I had before breakfast". An example of a patent that I consider truly wonderul and non-obvious is Joel Bartlett's conservative-compacting garbage collector; when I heard it described, I about fell out of my chair, I was so amazed at its cleverness.
I have several software patents in my name and a bunch pending. Mainly because its what my industry does and if you don't do it you have nothing to bargain with or a competitor could create a patent before you had chance to release your product. Crap yes, but a necessary evil. Its an expensive game and it makes it incredibly difficult for small companies .
Frankly if tomorrow all software patents were destroyed, I would rejoice. I have over my career looked at untold amount of patents and I don't think any of them are really worthy of being labelled "inventions". Could be my industry I dont know. The difference between the software packages has generally been how well they were implemented rather than a true patented invention. The code is already protected by Copyright so what's the value of the patent?
Seems to me a bunch of small fixes will go a long way:
- Reduce life of a patent to 5 years
- US courts should charge the loosing party in a patent litigation case the cost of the winning side
- Remove software patents and the aesthetic design patents (eg Apple rounded iPhone case BS)
The current system sucks because as the author states, a little patent troll can cheaply file and get settlements because the cost of all the expensive lawyers a big company uses for such matters will be higher.
If there's a loser pays system, what's to stop a big company, an Apple or a Samsung, for instance, from going out of their way to rack up big legal fees to scare little companies away from suing them at all? If some little company with a net worth of a couple million tried to sue one of them in a case that might go on for a while they can bring out their $500/hr lawyers and $1000/hr expert witnesses at trial and run up $2 million pretty easily.
The fear of that outcome is as likely to keep small companies from suing as the current situation makes the big companies more likely to settle.
I'm afraid there isn't a simple solution that's fair to both parties.
quote: "If there's a loser pays system, what's to stop a big company, an Apple or a Samsung, for instance, from going out of their way to rack up big legal fees to scare little companies away from suing them at all?"
If you aren't confident of victory, then you probably shouldn't be going to court over it in the first place? Litigation with the expectation you'll likely lose is a tool of large corporations wanting to reach settlement; they aren't litigating to win, they are litigating as a bargaining tool to reach a licensing agreement. Little companies shouldn't be doing that in the first place, because as you point out, it will bite them on the arse.
If the small company are confident of victory, then they can go ahead and (over)spend on as many fancy lawyers as they like, because the megacorp will have to finance it for them. The whole point of loser-pays is that it attempts to discourage weak litigants from attempting to use "pay-to-win" tactics to bolster a weak legal position; if you lose, the amount spent fighting it in court becomes entirely your problem on top of any punitive damages you become liable for.
I'm thinking that it makes it more attractive for larger corporates to consider licensing the work of smaller companies, rather than rip them off and then have to fight them in court and possibly losing. IANAL though, so I'm probably making the mistake of applying logic to the situation rather than experience.
"Of course there's nothing wrong with the idea of Patent Assertion Entities at all."
There is a big difference between a University or other inventor setting up or hiring someone to manage their patents, and selling the patent to a troll. If you could not sell a patent only license it that will kill the worst of the trolls dead.
But that has as much chance of happening as shorter copyright lengths in the US.
Except that won't work in worlds where cars aren't powered by unicorn farts.
It's based on the erroneous assumption that the PAEs will lose most or even a decent percentage of their suites. But they won't. They already target small companies without the resources to fight them. That won't change. What will change is that the PAEs will shake down the small companies for their lawyers fees in addition to the patent damages.
We have too many low-quality patents. Just improving the rules about new patents would still leave at least 20 years of bad patents for us to sort through. Patent reformers have tried making it easier to reexamine existing patents, but these efforts have been rebuffed by lobbying from Microsoft.
If we abolish the patent system, then we can cheaply abolish all bad patents. Then we can start patenting again with a clean slate.
"One [option] is simply abolish patents because they're the invention of the free marketeers. This woefully misunderstands the economics here: the patent exists because even we free marketeers agree that the public goods problem won't be solved without government sticking its oar in."
in FOSS development the incentive to innovate is to "solve problems" not "make money" so the idea that patents are even needed is flawed in this development model and even this software makes significant money without needing to rely on patents which for computers frankly are silly, after all, programming is math and this is explicitly excluded in patent law even if lawyers disagree so they get mega bucks
A lot of the complaints coming from the USA don't apply so much in other places like Europe. In my experience the quality of patent filings and examination is a lot higher here -- I've very rarely had a patent application rejected in the USA but the EPO has very often found valid prior art, needing modification of the patent to either explain clearly why this is different, to narrow the claims, or sometimes to just withdraw the application.
We also don't have the same troll/PAE problem as the USA for the reasons stated earlier, software patents as such are not allowed, and the costs of patent lawsuits are not as stupidly high. So don't assume the system is as badly broken worldwide as it is in the USA, because it isn't.
It's still not perfect, patents get granted which shouldn't, and companies use them to stifle a market instead of energising one by leading it. But without patents there's no reward for innovation, you can spend years and millions developing something radical and new and then see it directly copied in a few months by somebody who then undercuts you (because they haven't spent loads doing the development) and takes the market away.
But the criteria of it being novel and non-obvious should be rigorously applied -- especially in the USA -- to prevent stupidities like patenting a rectangle with rounded corners and a screen on one face...
This assumes implicitly that patents and copyrights exist to reward the inventor/author. In the US Constitution it is not put quite that way at all. Rather, the purpose is to "promote the progress of Science and useful Arts." A time-limited monopoly grant to the inventor or author is merely a means to that end, the implicit quid pro quo being, in the case of patents, disclosure so that others might build upon and extend the benefits of the invention.
Granting monopolies was not thought to be a good thing, to be tolerated for an offsetting public benefit.
A good many US patents are sought by academics or others working on grants or contracts paid by the government - i. e., the people. Accordingly, those patents, if granted based on the hopefully improved novelty and non-obviousness criteria, should be assigned to the public. Similarly, journal articles reporting on government funded research should be published, along with all of the relevant data, on a public facing server for download by anyone who wishes, and their copyright licensed to the public under a Creative Commons license.
If we paid for it, we should own it, and the inventor's reward should be the income received in exchange for the work done.
Along this vein, I've never understood why a photographer who was paid to shoot a family portrait owns the photo. Freelance work, fine, but not work paid by someone. The person paying should own the photo.
And what about medical records. Why can't I get a complete copy of all of my medical records. I or my insurance have paid for them, why can't I have a complete copy?
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