‘Bad Patents’ Are Just Another Big Tech False Narrative

“The mistake the ‘bad patent’ narrative makes is that a patent is less a technical instrument than it is an economic instrument. A patent is an instrument of profit, and it must be treated as such to encourage people to advance technology by filing patents.”

https://depositphotos.com/22873954/stock-photo-false-rubber-stamp.htmlOver the last 15 years, Congress, the courts and the USPTO have gutted the patent system. Fortunately, USPTO Director Andrei Iancu has been taking important steps to reverse some of the damage, with revised 101 guidance and changes in the Patent Trial and Appeal Board (PTAB). But the most important thing Iancu is doing is silencing the big tech “patent troll” narrative.

False political narratives condense complicated issues into an object and then villainize the object. Once a villain is created, its evil can be expanded to encompass anything you don’t like. When you have pushed enough bad stuff into the moniker, you can simply state its evil name, add a few campaign contributions, and Congress will magically pass laws in your favor to kill the villain.

The “patent troll” narrative has been valuable to big tech. It bought the laws they needed to perpetuate their monopolies. With Iancu silencing the “patent troll” narrative, big tech created a new one: “bad patents”.

The halls of Congress are now infested with stories explaining how “bad patents” destroy innovation. They demand that Congress preserve Supreme Court legislated exceptions to Section 101 subject matter eligibility, and that Iancu revert back to previous PTAB rules because both kill “bad patents” and this is the only way to protect us from evil “patent trolls”.

Big tech defines a “bad patent” as a “trivial variation,” an “abstract building block or technology,” or “so poorly written that it’s impossible to understand what it covers.” It is an emotional argument conjuring up feelings of anger and righteous indignation because “bad patents” are used to shake down innocent multinational corporations for something as inconsequential as patent infringement.

But what makes a “bad patent” bad?  The answer should be found through logic and reason, not emotion and righteousness. Because patents are economic instruments, there must be a net negative economic effect for a patent to be “bad.”  The reasonable question should ask if the patent creates a negative economic effect that is greater than its positive economic effect.

Fortunately, big tech gave the Senate Judiciary IP Subcommittee’s Section 101 roundtable some examples in February of “bad patents”: a method of proposing marriage, a method of swinging on a swing, and Amazon’s one-click patent.  So, let’s evaluate whether these patents have a net negative economic effect. (If you want to see more “bad patents” they are available at the Electronic Frontier Foundation, or Patent Progress, both of which are big tech lobbyists masquerading as nonprofits.)

The Positive Economic Effect of Patents

All three patents were examined by the USPTO. The method of proposing marriage was not issued, but Amazon’s one-click patent and the swinging on a swing patent were both issued.

In all three, the USPTO was paid examination fees. In two, the USPTO was paid maintenance fees. It is likely that all three hired patent professionals in the economy. All were disclosed to the public, so others were able to advance the art by inventing around or improving it. Therefore, all three have the positive economic effects of funding the USPTO, hiring patent professionals and advancing the art.

The Negative Economic Effect of Litigating Patents

Around 97% of patents are never litigated because they are either not commercially viable (not useful), thus not infringed, or not commercially valuable, thus damages are too small to return the cost of litigation. But when a patent is commercially viable and valuable, and it is litigated, both sides expend resources and experience uncertainty, which are highly disruptive to their businesses.

While both parties experience negative economic effects in litigation, in most cases the infringer is a resource-rich multinational corporation, and the patent holder is a resource-starved small entity: an independent inventor, a startup or an investor, or sometimes a non-practicing entity (NPE) acting on their behalf. Due to this resource asymmetry, the negative economic effects are by far more severe for the patent holder than for the large infringing corporation.

It is a simple fact that a patent does not cause litigation. A patent is a piece of paper. The infringer can cause it by the act of infringing, or the patent holder can cause it by asserting the patent outside its scope. However, the patent itself does nothing and therefore cannot be attributed negative economic effects.

This fact alone means that there can be no “bad patents.”  However, since many in Congress seem to have accepted the false narrative of “bad patents” running around destroying innovation, let’s investigate further.

The Infringer’s Negative Economic Effect

Many years before a patent is issued, most patent applications are published on the USPTO website. All patents are also published there. The USPTO has a search engine, as do Google and others, so anyone can find patents relevant to their business simply by searching the USPTO website or Google Patents. Patent infringement is illegal, so anyone in business has a responsibility to identify patents that they may infringe to avoid breaking the law.

That means that if a patent is litigated within the scope of its claims against an infringing product, the infringer knew (or should have known) the patent existed and that their product was infringing. Therefore, the infringer caused litigation by the act of infringing, thus the negative economic effects must be attributed to the infringer.

When a large competitor infringes a startup’s patent, the startup has no good choices. It can sue the infringer, but that means it must divert already scarce resources into litigation and away from business activities like engineering, marketing, sales, etc. Resources burned in litigation may never be recovered because loss rates for patent holders are unreasonably high.

Since eBay v MercExchange, injunctive relief is now restricted, so in the unlikely event the startup wins the infringement suit, the court will grant a compulsory license, not an injunction. The resource-starved startup will be forced to compete with the resource-rich infringer. Due to resource asymmetry and a very real risk that the infringer will use their deep pockets and existing market power to take the market and kill the startup, the startup will have difficulty attracting investment. When a startup sues an infringer, the startup may very well fail, whether it wins the infringement case or loses.

Many startups ignore infringement. They accept that they are forced to compete against a large infringer. At least they won’t have to divert resources to litigation. But for the same asymmetrical reasons, the startup will have difficulty attracting investment and is at risk of being run out of business.

The negative economic effects caused by infringement are damaging not only to the infringed startup, but also our nation’s innovation engine and our national security. When startups die and their investors lose money, investors invest their money in places where they get better protection, like China. For example, in 2017 48% of early stage funding for artificial intelligence went to startups in China—only 36% went to U.S. startups.

The “patent troll” narrative attributes all negative economic effects to the patent holder regardless of the cause of litigation even though the infringer is the sole party who can avoid the act of infringement. The patent holder cannot avoid the act of infringement. In fact, the patent holder attempted to discourage infringement by filing for patent protection. The negative economic effects of infringement must be attributed to the infringer and law should recognize this by discouraging infringement with injunctive relief, low costs and quick resolutions.

The Patent Holder’s Negative Economic Effect

If a patent is litigated outside the scope of the claims, and thereby against a non-infringing product, the patent owner caused litigation. Thus, the negative economic effects must be attributed to the patent holder.

The negative economic effects to businesses that have been wrongly sued for patent infringement have been made known, so they need not be regurgitated here. Unfortunately, the overreaction by Congress, the USPTO and courts has wiped out patent protection for small entities.

“Bad Patents” Have a Positive Economic Effect

The method of proposing marriage was never issued. It was a patent application, so it can never be litigated and therefore can’t produce a negative economic effect. This big tech example of a “bad patent” is nothing but a disingenuous attempt to sway Congress with false information.

Nobody sues anyone without a potential damages award because money spent litigating will never be returned. No damages can be calculated for a method of swinging on a swing because nobody is making any money doing it. Since there could be no damages awarded, money spent litigating would not be returned. This patent was never litigated, and the example is another disingenuous attempt to sway Congress.

But what about the “bad patents” that big tech says are too trivial to warrant patenting, like Amazon’s one-click?

Nobody can invent anything without improving what already exists, so all inventions are in some way an improvement. Sometimes, a trivial improvement becomes the primary factor differentiating the marketability of one product over another. Amazon’s one-click patent was a trivial improvement that had a significant market effect. It made the buying experience on Amazon’s site better than that of Amazon’s competitors, thereby drawing customers to Amazon’s site and away from competitors. It is one of the early reasons that Amazon got ahead of its competitors and therefore became the outrageously successful company it has become.

Amazon’s one-click patent did not affect its competitors’ products. Their customers could still use them just as they did prior to the one-click patent. Therefore, Amazon’s patent did not have a negative economic effect on any technology already on the market. But it had a significant effect on the marketability of Amazon’s products, which is an advancement of the art and a positive economic effect.

The mistake the “bad patent” narrative makes is that a patent is less a technical instrument than it is an economic instrument. Yes, a patent discloses advancements in technology, so patents are technical instruments. And yes, most of these advancements are trivial from the perspective of technology. But many are not trivial in their market effect.

Nobody does the hard work and spends money writing and filing a patent for the sheer joy of advancing technology. People do it to improve their lot in life. They do it for profit. A patent is an instrument of profit. It is an economic instrument, and it must be treated as such to encourage people to advance technology by filing patents.

The degree to which an invention improves the mountain of technology on which we live is not important for any given invention. It is the accumulation of many trivial improvements that is important, because some trivial improvements may turn out to be very important. For example, Edison’s lightbulb was a trivial improvement from a technical perspective. All he really figured out was that a carbonized thread used as a filament would last long enough to create a marketable lightbulb. But everything else in a light bulb already existed, even filaments. He just advanced it a little bit with a carbonized thread.

If we buy into the big tech “bad patent” narrative and agree that only big inventions should be worthy of patenting, there will be fewer trivial inventions. But we will never get a critical mass of trivial inventions needed for that one that matters, like a carbonized thread filament.

We will have to subjectively decide which inventions are significant enough to deserve a patent. Who can answer that question? Certainly not a patent examiner, and I don’t think we have any former Soviet central planners employed at the USPTO. Maybe we should do what we have for the last two plus centuries and let the market decide. After all, if the invention is so trivial that the market does not adopt it, there can be no litigation and therefore no negative economic effects.

Just as the false “patent troll” narrative wrongly villainized early stage investors as greedy rent seekers, the false “bad patent” narrative wrongly considers patents to be technical instruments, ignoring all positive economic effects and wrongly attributing all negative economic effects to the patent instead of to the party causing the infringement.

Both false narratives dangerously teach a fundamental misunderstanding of how patents achieve their Constitutional mandate to “promote the Progress of Science and useful Arts.”  Without correcting this misunderstanding of patents, bad public policy will continue.

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Join the Discussion

26 comments so far.

  • [Avatar for Benny]
    April 14, 2019 02:05 am

    Errors corrected:
    “The examiner shows that inventor the prior AVAILABLE to the examiner!…” — If I can find the prior art so can the examiner.
    ” it is the inventors responsibility from being familiar with the genre of what he invented to know what most existing prior art already is” — That is not a legal requirement.
    “IT IS NOT the legal responsibility of the examiner to as you are falsely claiming, to, “point out the prior art to the applicant and refuse grant”” — It is the responsibility of the examiner to refuse to grant a claim if the invention was publicly disclosed prior to the filing date, because in such case the applicant is not entitled to patent protection. (surely you knew that before, no?)
    “As if because you filled out a patent form first you thought no one would notice that that product is already in use somewhere else!” — Our competitor correctly assumed that the examiner would not notice.
    ” The judge that ruled for the legal party which your patent infringed” — The judge did NOT rule for the other party. Our patent did not infringe (patent can’t infringe other patents). Our product allegedly did.
    ” I wish I could refrain from name calling” — You can, and you should.
    “won’t listen to anyone telling you what the law is ” — We employ outside counsel
    ” We don’t say, “point out”” — This is the comments section of a blog, not a court of law. I am not restricted to using legal terminology here, I choose to use more informal language.
    ” I think the judge that ruled against your case” — did not rule against our case
    “an examiner is a judge.” — the examiner made a demonstrably wrong decision.
    “your company did not know about their said prior art” — Our company knew the prior art. I’m pretty sure the applicant did, too. The examiner didn’t.

    You obviously completely misunderstood the case here, which explains why your rant is so askew. To cut a long story short, company A went ahead with a product and didn’t file a patent application for the knurled flange bracket because they found that it had already been publicly disclosed by the bracket manufacturer. Company B obtained a patent for the knurled flange bracket despite the abundance of prior art, through a failing of the USPTO, then sued company A for infringement. Company A then had to line the pockets of several attorneys to get the patent off the books. I work for company A. Get it now?

  • [Avatar for Brent Beck]
    Brent Beck
    April 13, 2019 07:23 pm

    @PaulMorinville What do you think Paul, have we both struck “email-thread gold” here and are both now commenting here with a ceo from Apple telling us about Samsungs recent legal decision & win?

    Benny all I do when I read your comments here, is myself refer to read all existing legal writings: “c) it is the examiner’s responsibility to point out the prior art to the applicant and refuse grant.” – Benny Where in law or patent rules did you get and then proceed to commit perjury about this falsehood that you label as, “(c)”?

    You’re not from the patent office! I’d nail you legally Benny frankly because what you’re labeling as “(c)” is your own addition and is not a quote or legal writing from any such patent rule, or written regulation! I’d like you to tell me where you got that notion you have there? Who is the inventor of your company’s product? The examiner shows that inventor the prior AVAILABLE to the examiner! It is clearly written in patent law under the heading Patent Searches THAT IT IS NOT, THE PATENT OFFICES RESPONSIBILITY TO KNOW ABOUT OR FURTHER INFORM AN INVENTOR OF PRIOR ART! Rather it is the opposite, it is the inventors responsibility from being familiar with the genre of what he invented to know what most existing prior art already is!

    Now is it clear to you why your company lost all that money costing employees their jobs as you again claim etc, with you showing here, you always avoiding responsibility, from what I can deduce from what you only type above? I wonder how often in what other areas of your life you do this, seriously?

    IT IS NOT the legal responsibility of the examiner to as you are falsely claiming, to, “point out the prior art to the applicant and refuse grant.” “Point out” is not a legal adjective or legal phrase, anyone can see! Quite embarrassing. And your tenses are incorrect. Clear to you, now Benny?

    Further the fact that prior art, when already existing and maybe already in the market place makes your patent’s application weaker from it’s very on set. As if because you filled out a patent form first you thought no one would notice that that product is already in use somewhere else!

    You’re doing everything in law that I despise, you’re flouting the law, which to me is spoiled of you and frustrating to me. The judge that ruled for the legal party which your patent infringed most obviously also recognized this and acted accordingly.

    You’re also guilty of leading the witness via falsely stating in my case personally, “clearer now” with you implying that I had been wrong about what I tell you above legally. I am both very familiar with and I am very clear about what I said above and it seems, though I wish I could refrain from name calling, wish, want and hope you can realize or repent, how that, you are displaying that you have disrespect for law, disrespect for people in law, and won’t listen to anyone telling you what the law is and further you mock those who tell you.

    How you are employed, if you are in the legal department I seriously do not know, only because you ARE NOT showing in what you write above that you are familiar with law. We don’t say, “point out” in law for instance. Maybe a defendant can say that, but not an attorney.

    Also worse, it appears you are searching for legal loopholes that are disrespectful and as well as possibly illegal? I think that is what angered Mr. Morinville in his response to you above also? I think the judge that ruled against your case above also saw what I see about that which thereby frustrated him and he threw the book at your company rather than if you had otherwise said for your company to the judge, “How can we come to a resolution that fit’s all parties because it appears we are guilty of infringement?” Calling the examiner names proves you are not familiar in law. And you haven’t yet indicated to me you finally understand that an examiner is a judge.

    I am very clear, got it there? I want to be nice but you’re in law, for God sake’s. You should know better than what you’re indicating, if you didn’t like just “wing it” through any universities you may have attended.

    “” “Prior art” is entirely distinct from “my patent”. There might be an overlap but generally not.”” – Benny It can’t be both Benny as you say here, as much as in fantasy want that to be, your invention is or is not distinct, from prior not both. If it overlaps IT IS NOT DISTINCT. If there is an overlap you are an infringer and it shows you’re grasping at legal straws because you convict yourself of leaving your legal claim that your company did not know about their said prior art supposedly because an examiner did not tell you. 1. Distinct: recognizably different in nature from something else of a similar type.

    Yes, I am familiar with Patent Rules 102, simply, involving and defining Anticipation.

    Can you see the error of your actions? Or are you go on continuing to blame a patent examiner for a decision that was your fault? I hope you somehow someday hopefully sooner chose the prior option I indicate to you above.

    I guess I can only apologize to you Benny because I like to be a nice guy, but if it isn’t possible I’m only here am doing is giving the fact and written legal law. I pray you can learn to do the same eventually.

    Good luck Benny

  • [Avatar for Benny]
    April 13, 2019 01:53 pm

    Why don’t you just read 102 instead of spouting and spluttering ?
    I’ll give you the low down on it: a) You don’t get a patent if your invention has been disclosed by others before you filed; b)that means any disclosure, not necessarily by the accused infringer, and c) it is the examiner’s responsibility to point out the prior art to the applicant and refuse grant.
    In our case, (a) and (b) were true and (c) did not happen. Result: significant financial damage, mainly due the costs of righting the wrong in the proper channels. That clearer now ?
    Didn’t understand the reference to Bonn, by the way.

  • [Avatar for Brent Beck]
    Brent Beck
    April 13, 2019 01:08 pm

    Further Bonn, “because some undermotivated patent examiner was on a permanent lunch break.” – Benny

    This misspelled mockery quote from you toward a patent examiner is why you’re a loser Bonn. Anyway in patent law knows an examiner is like a judge or better a high court judge, but because you have the gall to sit in a courtroom where you’re accused of something and mock the very judge that is deciding your facts, you and your company deserved to have the book thrown at you completely and you should be released from any employment at the company you work at. Ever hear, “Show respect to a judge?”

    Don’t go to your boss there this Monday and tell him what I initially said above without quoting me, “Brent Beck,” or giving me the credit to your boss. If you weren’t living in your parents bedroom I’d suspect to see you in a soup line somewhere?

    Sensitive Adjective Response: Look Ben you obviously have no understanding or are familiar at all with Patent law to begin with? Can you tell me your credentials, that determine what you’re commenting? Common sense in life or a very minimal education in law would teach you not to mock any patent examiner which legally is equal to a very high court judge. How you do not know not to mock an examiner has resulted in your company’s financial loss. I think you would be better off not commenting on legal issues until you have studied law in some minimal form.

  • [Avatar for Brent Beck]
    Brent Beck
    April 13, 2019 12:45 pm

    Thank you Paul! All that is necessary to say.- But still I could not of expressed it better than you have here in answering, “Ben?” All of what you say Paul is spot on, entirely. A to Z.

  • [Avatar for Brent Beck]
    Brent Beck
    April 13, 2019 12:37 pm

    Benny you’re giving your opinion and you give either no legal precedent nor are you quoting anyone to prove what you say. You just want to give your opinion have me or anyone just accept it. Actually, you’re completely wrong, and it is how patent law works and how it was initially written to work. You cannot argue with written law. But apparently you’re of this generation that gives opinion as fact a new Liberal Sickness and want to say the U.S. Constitution is a outdated document, to which it is not other than electricity’s now present existence. Do not mock me with opinion, give me a legal quote or a legal precedent, because you don’t know what you’re talking about and obviously me saying so above using a bunch of sensitive adjectives you did not deserve from me I now see is true. You people like you either want to change stuff because no one is putting people like you in jail right now for trying to change law. You have no consequence for doing whatever the hell you want. Since the internet too and these idiots who say the internet changes how intellectual property works when the internet DOESN’T CHANGE HOW intellectual property works but idiots like you and everywhere else can swear so up and down all over the internet and no ones says a thing to you or attempts to halt you. The whole video SUPPOSEDLY inventing to nowhere would not have been ever published before youtube’s do it yourself ignoramus idiocy. I mean hey it is how patent law works and that’s why I told you that above. Here’s how patent law works. Because you want to argue or that have a crowd of idiots who want to argue doesn’t at all make you or them, right! Look man I wish there were consequences like jail for people like you and that would end argument. What are you going to do next, check my spelling in my comments here?! Let’s play mock. Because we’re too stupid give a decent legal reply. Are you an attorney, or a neighborhood preppy?

  • [Avatar for Benny]
    April 13, 2019 12:25 pm

    Youmay well be filthy rich enough to consider several hundred thousand dollars a “rounding error “, but in the real world I inhabit that figure means jobs on the line and employees laid off from the production floor. I don’t think someone who can’t make a mortgage payment after losing his job would agree with your definition of his wage “a rounding error”, nor would the employee be happy to learn that the job went because some undermotivated patent examiner was on a permanent lunch break.

  • [Avatar for Benny]
    April 13, 2019 02:58 am

    That is not how patent law works. “Prior art” is entirely distinct from “my patent”. There might be an overlap but generally not.

  • [Avatar for Paul Morinville]
    Paul Morinville
    April 13, 2019 02:48 am

    Benny, “In our company’s case, several hundred thousand dollars. That OK with you ? Not with me”

    Your multibillion dollar multinational corporation spent a rounding error in terms of their financial prowess. I spent at least twice that of my own money patenting my inventions, starting up a company based on them and losing it all to the false crap you peddle.

    Dont cry in your beer. Its unbecoming of a paid shill.

    I’m not alone. Thousands of us have had our shot at the American Dream taken and have been left penniless just for trying.

    Your swill has caused great damage. Far greater than your rounding error. You are also a coward hiding behind a false name and not naming the multinational corporation that feeds you.

    Why don’t you man up and tell me who you are and who you work for? Then we can accurately compare damage.

  • [Avatar for Brent Beck]
    Brent Beck
    April 12, 2019 05:47 pm

    @Benny @Paul, Holy @#$%@$%

    @Paul”for unjustly,” or, “toward justly?”

    @Benny, Hi, you state that the PTO granted a patent to a foreign company costing your company several hundred thousand dollars, is that correct? The way law works if your company doesn’t know, is, your company can take that foreign company to court if you have your prior art proving the foreign patent is an infringer, and THAT’S THE WAY the system is intentionally designed to work. Claims writers are not the final say on patent infringement, evidence is. Judges view evidence. Examiners write patent’s claims, attorneys at company’s write patent’s claims that thereby you can take your company’s patent claims to a judge saying a foreign infringer is taking our money and we want it back. I mean doesn’t your company already know this? What am I missing if not only the cost it takes your company of going to court? Is that the question here? You don’t say that your company has taken an infringer to court, only that you’re unhappy about someone else’s patent’s claims? GO TO COURT! For retail products such as for instance that the toy industry represents public perception will win a case most of the time. If someone tried to make a knockoff of Monopoly board game so to speak the public would see that, and the knockoff company would not sell many of their knock off monopoly board games because the public would recognize this and the cost of either retail board game would be the same. For things like music, I say, license and tax all the bootleggers, game over. Don’t get mad, just find a way to trace and skim the product and let them sell for you. And keep in mind all the copyright and trademark law in constitution is fifteen years where you’re supposed to re-invest that money again or else where. But part of what’s wrong is company’s want to go beyond that fifteen years and it ain’t what the law says.

    @Paul, much of what you say above is about quality of life issues, first world vs. third world. Those answers have not come in most the entire industrial revolution for two centuries, referencing the History Channel series “the men who built America.” It used to be up until about nineteen eighty five give or take ten years, white labor vs. white corporate. The Dems hiring all the third world employees of south america and the un-appreciative american worker have been the recent basis question. The demon that needs to be named is cheap labor. Do we put the factory south of the border to get cheap labor or bring these people to live in america and work for cheap for one generation until they want more luxury that they’re getting from initially being first generation migrants, legal or not legal. Until we assimilate instead of building multi-multiculturalism, as a country then we are not the country that existed. That’s what much on Facebook is about now. Only no one’s dying yet and no one has skin in the game intrinsically at this time of history with Edison preventing the existence of a nineteen thirties depression because battery’s save people’s lives. Engines, Watt, Robert Fulton what stopped slavery. Other than that, we’d still be trying to finding the strongest people to tote that barge. These are quality of life issues I’m defining, I do condone what I am defining, I am only writing a definition that makes reality very clear hopefully, that reality what you reference above as you defined, as, “national security.” I call national security, quality of life questions. I think what the main obstacle is the drug trade affecting the third world countries. Everything is a question of percentages until anything becomes epidemic in scope where a human being/s is suffering. Quality of life is a creation by the Pilgrims of which my ancestor is accused of how we supposedly wasted an already present people here and built a quality of life. The only thing that is absolute is the pleasure and pain of the human being. So where does the third world and first world meet is the question that needs to be clarified or defined.

    Further, I have two registered patents with the third a prime illustration of what an invalidate patent actually is. I invented the Velcro belt that I gave a trademark to at one point, Second Sea Belts I initially believe, but the examiner said it is anticipated or maybe not novel enough and told me to file a design patent instead. My examiner said a design patent will pass and be a registered patent, since I was not mass producing the velcro belt I did not purse said design patent. So within the last year I see advertised some kind of belt infringing my claims found on my velcro belt of incremental size variables unobvious on standard belting with peg in hole device. So first, “my patent was invalidated.” And or but my patent’s claims are being infringed. Legally there is nothing I can do, but, I could show my prior art and patent wrapper to a judge including claims to see if this new product owes me money? Anyone want to get my money for a percentage on spec if winnable? Ta. I just love saying ta. The whole patent system is very very clear and simple but people are blinded most of the time by ambition I think and do not then after that see clearly at all. Daffy dack I say it’s all I can legally think to say, Daffy dack. : )

  • [Avatar for Benny]
    April 12, 2019 04:50 pm

    “What is the true economic cost of a patent that should not have been issued?”
    In our company’s case, several hundred thousand dollars. That OK with you ? Not with me.

  • [Avatar for Paul Morinville]
    Paul Morinville
    April 12, 2019 04:29 pm

    Benny, “Paul’s article only makes sense if we are to assume that the USPTO never errs in granting patents.”

    What is the true economic cost of a patent that should not have been issued? Since there is no economic cost to a patent that has not been litigated, maybe what we can do is look at those that were invalidated. I’ll agree with your claim that the PTO errs in allowing some patents. After all nobody is perfect. But that means they can also err in invalidating patents and the courts do too.

    So we need to evaluate whether the invalidated patents are wrongly invalidated. With 64% of patents challenged under 101 invalidated in the courts, and over 80% invalidated at the PTAB, it seems there is a significant number of wrongly invalidated patents. My bet is somewhere between 75% and 90% are unjustly invalidated.

    So we should evaluate whether the invalidation was in error and remove those wrongly invalidated from our list. Once the list of justly invalidated patents is complete, we can simply add up the litigation costs to get our number.

    But to be fair and since we know that mistakes are made, we also need to take a close look at the economic costs are of wiping out the patent system in general to save whatever the economic cost is for justly invalidated patents.

    What is the economic cost of the US losing its technology engine to China? There are also even larger costs which are harder to quantify that we will need to take a stab at too. for example, the tech leaving for China is critical to our national security. What is the cost of China building a superior military? Better ships, better planes, better infantry, better bombs? What is the value of a free Taiwan and southeast Asia. What is the value to free trade routes? What is the value to privacy in the US?

    I suspect when we get done with our analysis, we will determine an economic cost of properly invalidated patents of no more than a billion or so dollars. But the cost to wiping out the patent system may be our job creation, our economy, our allies, and in the end, our freedom.

  • [Avatar for Benny]
    March 31, 2019 02:46 am

    No such thing as bad patents? Of course there are! Any patent which is invalidated, at cost to a petitioner, in face of prior art is a bad patent with negative economic consequence. This is on the premise that a)it is found that the patent should not have been granted under the USPTO’s own rules and b)there is a financial outlay in invalidating the patent.
    Paul’s article only makes sense if we are to assume that the USPTO never errs in granting patents.

  • [Avatar for Brent Beck]
    Brent Beck
    March 30, 2019 06:13 pm

    Return to #Paul Morinville, reading your comment here Mar 30 2019.

    “Copyrights are quite a bit different than patents. Yes both are intellectual property. PRIMA FACIE Copyrights do have some tension with freedom of speech. But there is no tension between freedom of speech and patents.

    There are areas where some things can be copyrighted that are not speech. For example, writing code is not speech. It is running a machine.” – Paul Morinville

    Thank you Paul, as you being the writer of this enlightening article I’m glad you’re responding to my comment.

    So I’m glad my comment does not mention the words of either Trademark, or, Copyright. My comment does mention the ability of anyone via speech to draw a picture of a Trademarked Mouse when said picture isn’t whereby used for monetary profit. The act of drawing falls under freedom of speech and is not hindered by Copyright, Trademark, or Patent or, Trade Secret.

    If I can effectively share existing law rather than trade each of our opinions?

    And actually your latter paragraph above is incorrect, via the copyright law, “words in that order” is the law. Or in the case of computer coding. “Arabic letters in that order making words in that order” And actually I’m clarifying copyright has no tension at all with freedom of speech anywhere, whereby that being my exact “point” to you. Copyright and Freedom of Speech are intrinsically like water and oil at their element because copyright is for profit as Constitution explains, but all freedom of speech has no profit. That’s why the guy lost “let’s get ready to rumble” because he cannot prevent another from saying that. Now, right now, he wised up and is popularizing his intonation of speech in the newly heard Toyota commercials being unique to himself and only under threat of losing his profit if Rich Little was still now living. I mean this sincerely and hope it is clear.

    Potentially there is stress between free speech and trade secret because trademarks involve speech that have a negative trade/economic effect if spoken.

    So now that I addressed your specific comment, may I in general summarize what the PTO is and what the PTO is not?

    The PTO is a witness for your company. The PTO is not a company, that can “make it happen” for your invention or product. Your product is a product when it’s in demand. Supply & Demand. The Constitution says you can profit for a LIMITED TIME for your, in demand product. A Patent that hangs on the wall is useless art but it’s very aesthetic, no? I am glad the new PTO Head is setting things right. He needed to do so. I saw the video Inventing To Nowhere as causing a lot to go wrong. I’ve shared this before and I’m only analyzing fact and law. Since they were children of Silicon Valley people and not PTO attorneys they got away with saying things in a video that are completely untrue and the video should be stopped by now. In the video they express themselves their bike is anticipated legally and then proceed to have the gall to talk about stopping people riding bikes in public and confiscating their bikes. The claims made in that video did not exist. They cannot exist because the law explains tangible items. Tangible items have, a law unto themselves. The law delineates ‘positive economic effect’ and ‘negative economic effect’ which you have properly phrased above and as is expressed in Constitution.

    Wish to get paid for pointing these things out? I could use it?

    Thank you

  • [Avatar for Night Writer]
    Night Writer
    March 30, 2019 04:41 pm

    @11 angry dude

    Lemley admitted in an article that through his investments and his wife who is a former executive of Google that he has made a lot of money by damaging the patent system.

  • [Avatar for angry dude]
    angry dude
    March 30, 2019 01:58 pm

    Night Writer@10

    “It is also well known that Lemley is making 100’s of millions of dollars burning down the patent system using the respect he gets from being a professor at Stanford.”

    Is that true ???

    I just don’t get it how a “renowned professor” can lecture his students about the subject (IP) he is actively destroying
    This is more than “unethical”
    I would check his sources of *corporate* funding and bring criminal charges against that dude (if I were a parent of one of those kids he lectures…)

  • [Avatar for Night Writer]
    Night Writer
    March 30, 2019 12:05 pm

    The core of what has happened is the academics. They have published papers and books that legitimize this narrative. And yet their work is not peer reviewed and there is no consequence for them acting unethically in writing the paper.

    People like Mark Lemley regularly are unethical in papers and yet they are cited by the SCOTUS. Consider that Lemley claims that software has no structure in one of his papers and does not cite to any counter opinions. It is also well known that Stanford law school does not care what Mark Lemley does. It is also well known that Lemley is making 100’s of millions of dollars burning down the patent system using the respect he gets from being a professor at Stanford.

    If you want to restore patent rights, there could be nothing more important than taking down Mark Lemley. Hold him accountable for unethical behavior. There are many academics like him. There can be no narrative about bad patents with the academics providing the backstop.

  • [Avatar for Maddness]
    March 30, 2019 10:46 am

    Big tech has gamed the system by waiting for small patent inventors to bring their product to the USPTO to get their IP patented and then Big tech takes your idea. By the time you realize your invention has been stolen Big tech is already making money off of your product. You try to fight them but all the laws like EBay, Alice the PTAB have been created to kill off inventors rights in getting paid. Big tech has paid off government to make their theft legal with the anti patent laws they lobbied into government.

    It’s hard to fight someone that has bought up all the law makers and have billions in cash because of their patent theft. Can America get it fixed? I doubt it, China is becoming the place to go to get your patents registered and protected. Bye bye U.S.A.

  • [Avatar for box7003]
    March 29, 2019 08:22 pm

    Thank you Paul for your efforts to bring back our patent system, good article. Congress and big tech effectively shut down many startups that must have patents that can be enforced. I’m thinking of selling donuts instead of tech or mechanical ideas.

  • [Avatar for Boris Truth]
    Boris Truth
    March 29, 2019 07:32 pm

    I happy Apple, Google and Anazon have found a way to cut out paying licensing fees. EBAY, ALICE PTAB are life savers. I have made a fortune owning these stocks the last 10+ yrs because of these laws and so have the representatives from Congress and the SCOTUS that also own shares in Apple, Google Facebook and Amazon. If you think for one second the special interests groups are not coming up with a new way to block Sen Coons and Sen Tilis’s new IP bill you are a fool. Its game over for the small IP holder. Silicon Valley spends 3x more then the NRA lobby..No chance IP holders will get paid. Just buy some Google stock or Amazon and forget about the inventors, the game is rigged and the elites run the system. The old saying goes if you can not beat them, join them. The politicians and the SCOTUS are already on board. Silicon Valley spends $120-$150million a year lobbying government, more then the oil industry, more then the NRA, more then any other lobbyists group in American politics. It’s all wrapped up.

  • [Avatar for Paul Morinville]
    Paul Morinville
    March 29, 2019 06:48 pm

    Brent @5. Copyrights are quite a bit different than patents. Yes both are intellectual property. Copyrights do have some tension with freedom of speech. But there is no tension between freedom of speech and patents.

    There are areas where some things can be copyrighted that are not speech. For example, writing code is not speech. It is running a machine.

  • [Avatar for Brent Beck]
    Brent Beck
    March 29, 2019 04:23 pm

    As a non-business model, whether a class of kids at school each may legally draw Mickey Mouse is addressed in your article here also? Freedom Of Speech at that point. If those kids are not selling their pictures of Mickey Mouse, then there is

    no “negative business effect”

    and actually serves as positive advertising for Walt Disney. It is only when kids or parents of kids were to sell the pictures, would there ever be cause for Disney to respond with a legal action.

    Thank you

  • [Avatar for Pro Say]
    Pro Say
    March 29, 2019 03:52 pm

    Great points Paul — thanks.

    “Bad patents?”

    No. Bad infringers.

  • [Avatar for Dave Barcelou]
    Dave Barcelou
    March 29, 2019 02:51 pm

    “The ‘Patent Troll’ narrative has been valuable to big tech. It bought the laws they needed to perpetuate their monopolies.” Really? Asking for a friend…

  • [Avatar for B]
    March 29, 2019 01:16 pm


    Great article and spot on. You especially hit the economic asymmetry issue perfectly.

  • [Avatar for concerned]
    March 29, 2019 10:32 am

    Great article and well articulated!

    I also feel the marketplace should determine the worthiness of a patent, not judges (assuming new and non-obvious). In addition, the price point on the patented item has to be right also, even with a monopoly of 20 years, which protects the consumer.

    As the author so rightly points out, if the marketplace does not like your item for whatever reason, the consumer can still use the in-place product prior to the patented invention without harm. Do not the light bulb for whatever reason, too expensive, etc.? Just continue to use candles, no harm done.

    Putting any thought behind these false patent narratives reveals their true hidden agenda.

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