Stepping Back from the Cliff: The Year Congress Didn’t Cave to the Anti-Patent Lobby

For a many years, the pied pipers of the anti-patent lobby whistled the patent troll melody and Congress, desperately in need of a glorious bipartisan victory, pushed and ultimately passed inventor killing legislation horribly misnamed as the America Invents Act of 2011 (AIA). To be more correct, the America Invents Act has thwarted American innovation at the grass roots level. Thanks to the creation of the Patent Trial and Appeal Board (PTAB) and three new mechanisms for efficient infringers (i.e., large companies who steal patents) to strip patents away from inventors after having toiled, struggled and suffered to finally convince a patent examiner to issue the patent after many years, perhaps decades, of back and forth negotiations. Indeed, the AIA has thrown a wet blanket on grass roots American innovation by starving inventors from capital by driving investors out to safer investments, or increasingly to innovation based start-ups in other parts of the world, such as Europe and China.

There is no doubt about it; the AIA has grass roots innovation in America on life support. What is tragic is that this was predicted, but few leaders in Washington, DC stopped long enough to look both ways before acting. It is no wonder they didn’t notice that they were standing on the edge of a cliff and about to gleefully run forward one by one like a bunch of lemmings. And this happened all in the name of bipartisanship? Why can’t patent policy be like everything else where there is hopeless gridlock between Republicans and Democrats and nothing ever gets done? That would have been a substantial improvement over the last decade compared to what we have now.

The real consequences of the damage began to emerge in 2015. But 2016 represented a sobering up of the patent reform debate as metrics on the effects of AIA created PTAB procedures and other seriously flawed court decisions laid bare the damage caused to America’s innovation engine.

The truth is innovation happens at the grass roots level because innovation happens when risk is taken and the larger a company gets the more risk averse decision-making becomes. Furthermore, as companies grow so too do bureaucratic layers of red tape, which make it more difficult to green light even the best projects. For these reasons and others, most innovation comes from small entities and individuals. That is why so many large corporations so frequently buy up much smaller competitors, because of their innovation.

But the America Invents Act has been a wholesale wipeout of small inventors and new technology startups, right at the grass roots level, which is certainly not what the good citizens of America sent them to Washington to accomplish.

So now, five short years since the America Invents Act was passed, Congress has taken off their blinders and is stopped, suspicious, and cautiously looking for solutions where there is a true industry consensus. This newfound caution slowed down the House enough to see the damage coming from the Innovation Act despite hard and aggressive anti-patent lobbying by Google and other consumer internet multinationals and retailers who benefit from weak patent protection. These technology users do not innovate, but rather they take the innovation of others and use them in commerce for their own benefit while giving the true inventor nothing in return. The House, skeptical this time around, did not mindlessly run over the cliff. They waited and watched and listened, and the total collapse of American innovation was averted by effectively killing the Innovation Act through inaction.

The Innovation Act actually died in 2015 in the House. By the end of that year, the anti-inventor lobby was already trying to disassemble it and pass it in parts. But the Senate bill, the PATENT Act, was still kicking in January of 2016.

The most salient moment of 2016 was the silence emitting from the Senate Judiciary Committee after January. In February, the PATENT Act went silent and remained silent for the rest of the year. It seems that Senator Grassley, the Chairman of the Senate Judiciary Committee, decided to pull it off the burner without really saying he had done so. It just got quiet and slipped away.

Perhaps Senator Grassley’s hand was forced when the House stopping at the curb to look both ways. Or perhaps Grassley saw the cliff and decided to take a step back. Perhaps his staff just couldn’t find Iowans affected by patent trolls despite their best efforts to locate tear-jerking stories. Maybe Grassley listened to Iowa inventors discussing the effects of patent reform at his town hall meetings and learned about how the patent system really works to drive capital to startups and create new jobs in Iowa and around the country. Whatever the case may be, the PATENT Act was not forcefully pushed in the Senate and without any press release or announcement from Capitol Hill patent reform died for the 114^th Congress.

For whatever reason, 2016 represented the year that Congress itself, or at least enough Members of Congress, got serious about considering the negative effects of pandering to the anti-patent lobby. Those effects are now clear and the stage is set to turn it back. Of course, we can anticipate there will be new pushes for patent reform in 2017 and beyond. Perhaps some of those attempts at patent reform will be from the pro-patent side, but we need to remain vigilant because the anti-patent lobby has not and will not go away.