Patent Durability: Building a Better Fence

“Patent durability incentivizes inventors to be efficient in constructing their patent protection….By requiring inventors to invest in their own protection via patent durability, a higher level of credence will be given to the value of an invention.”

White vinyl fence by green lawn

At the very end of the movie “The Current War,” Benedict Cumberbatch, the actor who played Thomas Edison, bumps into Michael Shannon, the actor who played George Westinghouse. The two had battled for years over implementations of their respective electric current systems into society, with Westinghouse winning in the end. This particular meeting probably never took place, but the conversation in the movie was rather interesting. After some small talk, Edison, one of the greatest inventors in American history, turned to Westinghouse and said, “Don’t you think a fence is a unique creation? Your neighbor puts one up, and suddenly one becomes two. You also have a fence. There’s only one problem. You see, one person on one side of the fence designed it, one person on one side built it, and one person paid for it, and yet the other person received a fine free fence.” After Edison made these comments, Westinghouse paused, and calmly said, “I didn’t take your ideas.” A few moments later, Westinghouse substantively wrapped up the encounter by stating, “You know, I think the solution is to divide the cost of the fence, to where you could not build a fence at all. Your garden would be twice as big. Wouldn’t it, Tom?”

A patent is a fence, in a sense. When an inventor procures a patent, he or she has put up a fence, making it more difficult for a thief to take what is inside. It would be lovely if we did not need fences, but human nature tells us that we do. It’s the same reason most people choose to lock their doors at night. Now, when it comes to the cost of the fence, this is where Westinghouse has a point.

Many inventors either cannot afford the costs associated with procuring patents, or do not have faith in the patent system to justly compensate them when they disclose their technology. In these situations, they most often choose to do one of two things: a) tell people about their inventions but do so without any protection; or b) keep their inventions a secret. These are bleak options. If the inventor tells people about the invention without any protection, and the invention is worthwhile enough, people will steal it, thus jading his or her spirit for invention. For an inventor whose spirit might otherwise have been ferocious enough to attempt something 10,000 times in order to discover today’s incandescent light bulb, he or she might give up, robbing society of what could have been something truly great. Regarding secrecy, many of the inventors who choose secrecy often believe that in order to receive just compensation for their discoveries, they have no other choice, both because the patent system cannot be relied upon, and trade secret protections are recognized for certain types of inventions. However, if they end up going to the grave without telling anyone how their inventions work, society will miss out on a great opportunity. Alternatively, if these inventors knew that the patent system could offer them just compensation for their discoveries, they would flock toward public disclosure in droves.

Enter, ‘Patent Durability’

The solution to these problems is to enact legislation that factors a new variable into the calculus, one coined “patent durability.” Patent durability is a newly created and legally binding proposed aspect of a patent that comprises a plurality of components related to patent procurement and patent enforcement that each have a composition proscribed by an inventor on the filing date. Example components of patent durability may be: a) a cap on future damages; b) a cap on future patent assertions; c) an increased amount required to be paid by future defendants to institute Inter Partes Review (IPR); d) a variable patent term; and e) restrictions on amount of claims in an application (e.g., a utility patent application that is limited to one independent claim and one dependent claim on the filing date). When these five components (and there could be more – different (e.g., relaxed) 35 U.S.C. § 101/103 standards, should the mandates of these statutes ever become clearer) are proscribed on the filing date, a patent durability calculator would yield a cost schedule, via an actuarial process, as done in the insurance industry.

Costs in the cost schedule would be based on maintenance fees and filing fees, which would now be different for each patent. One example of how a patent durability calculator might work would be if an inventor wants to proscribe on the filing date that damages associated with a given patent will be capped at $20 million in the future (e.g., a less durable patent), resulting maintenance fees and filing fees on that patent would be cut in half, all else being the same. Claim restricted applications (which would take less time to draft), caps on future patent assertions, and reductions in patent term would also result in a reduction in maintenance fees and filing fees, all else being the same. Another example might be if an inventor wants to proscribe on the filing date that a future defendant will have to pay twice as much to institute IPR (e.g., a more durable patent), resulting maintenance fees and filing fees on that patent would be doubled (and might require more drafting time), all else being the same. It follows that patent durability makes the overall costs of procuring a patent and the strength of a patent much more variable. It also allows inventors to more easily recoup costs from those who use their inventions and would provide society with disclosures of inventions that would otherwise not be disclosed.

The Advantages

In operation, patent durability gives more power to inventors by allowing them to tailor their patent protection to the value of the invention, as opposed to today’s approach which is one size fits all. When inventors proscribe patent durability on the filing date, they are forced to make an investment on the future value of their invention. As it stands now, the value of the patent is determined at a point far in the future, with an insignificant amount of input from the inventors. Unfortunately, when this is done, the securities surrounding money become greatly reduced, causing its exchange to dirty the hands of those involved. Patent durability at least partially remedies this by tightening those securities, thus allowing the hands of those involved to remain cleaner. Specifically, it makes the protection provided to the inventor more proportionate to its value than is done presently.

Patent durability more justly compensates inventors for their efforts to invent. It does this by taking into account what protection inventors believe the invention calls for, what their financial position is, as well as what they would be willing to sacrifice to procure the patent. When a patent application is filed, having the inventor proscribe patent durability fuses these considerations with the patent, giving it a measure of net present value. This value is born from the inventor’s desire to solve a problem and is thus a measure of the magnitude of the problem being solved. When it comes to the problem solved by an invention, the inventor takes a back seat to no one in understanding it.

The Trade-Offs

Additionally, while some inventors may believe that their inventions are worth a great deal more than they actually are, the only way for them to get robust protection is to pay a great deal more than they need to. When the inventions of these inventors turn out to not be as valuable as they initially thought, they will have an overly durable patent protecting them, one which they spent more on than was necessary. In other words, patent durability incentivizes inventors to be efficient in constructing their patent protection. Furthermore, while some inventors may have a valuable invention and not be able to afford the protection that the invention truly merits, patent durability will allow them to get a great deal more protection than the current system provides. Specifically, they can spend significantly less on attorney and U.S. Patent and Trademark Office fees for less durable patents, as well as receive a nontrivial amount of patent protection. Moreover, by requiring inventors to invest in their own protection via patent durability, a higher level of credence will be given to the value of an invention. Policing infringement will thus be streamlined because it will be easier to determine whether this value and what the plaintiffs are seeking correspond to one another.

A Future with Patent Durability Would Be More Flowery

What would patent durability mean for our gardens, to stick with the language from “The Current War”? It would mean that there would be many more flowers in each of them, flowers that would be much prettier to look at, and ones that would have been planted with cleaner hands. Allowing the durability of a fence’s makeup to be a variable element of its construction will cause the flow of money between those who invent and those who benefit from inventors to be more secure. For example, though less expensive and less durable fences will not be all that difficult to scale, they will still deter many people who might otherwise steal and will force those people to pay more than a nominal amount for what is inside. For more expensive and durable fences, they will be very difficult to scale and will do a more thorough job of forcing malevolent actors on the outside to pay for what is inside instead of stealing. Additionally, because patents are published, and because they expire after a set time, the whole world will be able to see and pay for what is inside, as well as take what is inside free of charge once the patent expires. Moreover, because the inventor will have been more justly compensated, his or her spirit for invention will not have been jaded as a result of any disclosure. Does this not promote the progress of science and useful arts?

Image Source: Deposit Photos
Image ID: 12277191
Author: cfarmer

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8 comments so far. Add my comment.

  • [Avatar for Anon]
    Anon
    December 14, 2022 09:49 am

    on’t we owe it to them to give this some consideration?

    Absolutely – and exactly why the substantive patent right must NOT be made a function of who owns that right.

    Good intentions will simply not suffice, and attempts to make substantive patent rights to be a function of who owns the right will end badly.

  • [Avatar for John Powers]
    John Powers
    December 13, 2022 08:18 am

    Thank you so much for taking the time to read my article.  I’m really grateful for all of your feedback.  A lot of what has been said in the comments I wholeheartedly agree with.  For example, of course what I am proposing will dramatically change the landscape (e.g., the MPEP, international treaties, the PTO / court infrastructures).  This would be an enormous paradigm shift, one that would take many years to implement.  As such, it is my first attempt to articulate a solution for what I have experienced as a huge problem for my clients. Specifically, I have different types of clients – some who have inventions that they believe could bring $400k into their business, and some who have inventions that they believe could bring $4 billion into their business.  The current system gives them no CHOICE in how they protect themselves.  Both clients have to pay the same fees for the same protection (e.g., the system is one size fits all). Further yet, they have to risk winding up in litigation that might otherwise be streamlined if they were given the ability to tailor their patent up front.  I’ve talked to both types of clients, and they have told me that they would appreciate bargaining power in protecting themselves.  Don’t we owe it to them to give this some consideration? 

  • [Avatar for George]
    George
    December 10, 2022 12:40 am

    @ David Lewis

    Good points! Not what’s required. What’s required is adoption of a patent system that works fairly for all Americans (and even for Europeans and others), and rewards all inventors independent of class, income or entity size. That would obviously require repeal of the totally unfair and biased AIA.

    We basically have to return to the original intent of the Founders and the Constitution, which WASN’T the AIA! What we have now can’t be farther from that original intent (and that’s exactly WHY large corporations & monopolies wanted the AIA). They wanted to be able to steal IP with impunity and get away with it. They also wanted to make sure the USPTO never again issued any ‘broad patents’ (unless such patents could easily be invalidated or defended against, if somehow they were ‘accidentally’ issued by the PTO).

    Yes, it’s true, no more ‘broad patents’ are allowed under our current patent system (even though not prohibited by law). This is a new and ‘secret policy’, apparently adopted by the PTO in the last 20-30 years, without consultation with, or even knowledge of Congress or the courts. This secret policy is not officially a part of the AIA but needs to now be exposed as an ‘unofficial’ part of it.

    It was never the intent of the Founders to simply DENY broad patent protections (even those meeting all statutory requirements and tests, ‘multiple times’, OVER MANY YEARS of examination). Indeed this would have been the exact opposite of what they intended (which clearly was to reward inventors of ‘significant’, ‘breakthrough’, ‘broadly useful’ and ‘broadly valuable’ new discoveries and products, that would encourage as much innovation and economic growth as possible in a new country and in order to prevent such innovations from simply being stolen and used without fair compensation to those responsible for them (i.e. fair ‘profit sharing’). We no longer have ‘fair profit sharing’ for things made possible by new innovations and ideas. Those who exploit those new ideas, are the only ones who profit now. That’s unacceptable.

  • [Avatar for David Lewis]
    David Lewis
    December 8, 2022 05:41 pm

    I am glad I am not the only one that thinks this a terrible idea. It would not work out well for poorly funded inventors who have no idea what their invention is really worth. Requiring people to put a value on their invention long before getting a patent would not be very fair. Even if they knew the value of the invention at the time of filing, it could change radically by the time it is litigated.

  • [Avatar for George]
    George
    December 7, 2022 11:28 pm

    Have you ever invented anything and gotten a patent on it, John? Did it have any value in the end? Also, did you have to file 10, 20, or 100 patents on the same invention, to get the same level of protection a SINGLE patent did 100 or 150 years ago? How many patents would Bell, Edison, Tesla and Wright brothers have had to get TODAY to get the same ‘broad’ protections back then. I would think Bell would have needed at least 100 (if not 1000) and Edison would have needed at least 20-30 on his light bulb (and actually it might never have gotten a ‘good’ and ‘enforceable’ patent today, since it wasn’t even a ‘new idea’ and since it only involved a ‘material change’ that any POSITA at the time could also have reasonably come up with – maybe with much less ‘trial & error’ than Edison had to expend, b/c he WAS NOT a scientist who understood the property of materials (he just ‘guessed’). NONE of the people we call ‘famous inventors’ would likely have been able to get a SINGLE ‘broad’ patent today (with the possible exception of Tesla), b/c our legal system has now made that impossible (to the great advantage of lawyers everywhere). That’s a shame, don’t you think? That ‘correlates’ with the absence of any ‘famous inventors’ today, as well, don’t you agree? Where are they all? We should at least have 10x as many now (since the population is that much greater and much more is available to work with, including knowledge). So, where are they and who’s to blame for their absence? The inventors themselves? A system that works to intentionally ‘exterminate’ them, as though they were just cockroaches, rather than valuable resources? Where are all our women & minority inventors? They can’t invent? They can be highly paid doctors, lawyers, bankers and CEOs but not inventors? They don’t have what it takes (i.e. they’re not willing to ‘suffer’ and ‘starve’ like that, to make lawyers rich?)

  • [Avatar for George]
    George
    December 7, 2022 11:11 pm

    The above is absurdly complex and unworkable. A proposed better solution . . . much better solution (and much closer to what we once had):

    1. Allow inventors to get ‘broad’ patent protections AGAIN (as they could
    100+ years ago – as exemplified by Edison, Tesla, Bell, and 100’s of other ‘famous’ inventors, which we no longer have).

    2. Have all issued patents fully ‘backed’ by the government that issues them and have them be deemed 100% ‘valid’ on issuance! If later they should be found not to be valid, the inventor would be refunded all fees paid to the PTO as well as all legal fees expended. Because allowance of later determined invalid patents should almost never occur in a ‘properly run’ patent system and should happen less than 1% of the time. It would cost the PTO very little to refund any such ‘wasted’ monies & that could be easily covered by insurance created for that purpose (paid for by taxpayers, not filers). Examiners & their SPEs would then also get a strike on their record and after 3 such strikes, they perhaps would be shown the door (but examiners should also get almost unlimited time to examine each application, as in the past, because examinations would be paid for by the government/taxpayers as well)!

    3. Along with (2) above, the number of patents allowed to issue each year should also be reduced by at least 90%, so ‘once again’ there would be very little if any overlap between ‘broader claims’ and patents, and so far less duplicative and ‘insignificant’ follow-on inventions would be allowed (which only causes needless ownership disputes and confusions and, again, ONLY financially benefits lawyers). In this way inventions should have to pass a ‘significance’ test (scientific and/or commercial) FIRST, before examination even gets very far. In addition, any cited prior art should also be subject to this same test to determine if it truly has any merits that can justify its preventing newer inventions from superseding them (especially if an earlier invention may never have been privately or commercially used, been deemed useful or scientifically significant, or if it had been simply abandoned). Prior inventions which have never ‘lead to anything’, had any commercial or scientific utility or worth, or had never been deemed scientifically significant by ‘outside experts’ in the field (rather than examiners who are not), would no longer count against a newer invention that could be commercially or scientifically of value and therefore contribute to society and/or the economy (as intended by the Founders and the Constitution). Art which is deemed to NOT have been useful or significant in the past, should therefore not be allowed to invalidate newer inventions which could be. Indeed, when actual models and prototypes of inventions were often required to be submitted to the patent office, in order for examiners to be able to test them and thereby determine if they ‘worked as claimed’, this essentially served the same purpose as the ‘significance’ and ‘functionality’ test described above. If these models & prototypes failed to actually work as claimed (such as a perpetual motion machine), then a patent would not be granted. It served as a check on both veracity and quality, which we have now dispensed with to the great detriment of patent quality and value. To implement such restrictions on the use of prior art arguments against new inventions, such references would have to be recognized by the scientific community or had at least been been privately or commercially used at some prior time, so as to clearly demonstrate a ‘value to society’ (so as to eliminate the citation and combination of ‘dead-end’, DOA or abandoned inventions that never resulted in anything of use or value).

    4. Domestic inventors successfully obtaining patents complying with (1) – (3) above (proving they have disclosed a potentially significant, useful and valuable invention), should have their application fees refunded and not be assessed any other fees for the life of their patent (even in the case of re-examination or court challenges). In other words, their patents should be fully backed by the government, with their fees reimbursed and any defense costs covered as well (say by means of a tax credit). This is because ‘good’ and high quality inventions would obviously be of great benefit to society and the government, and likely result in new tax revenues and create new jobs for Americans, more than paying for any such credits.

    However, the ‘perverse incentive structure’ that now exists in America does the exact opposite of the above, since it rewards those who steal inventions much more than it does inventors, who mostly just get ‘ripped off’ with HELP from their own PTO, while ‘invention thieves’ behave like carefree pirates who never have to face much justice at all (much less have to walk ‘the plank’ of justice) and who can greatly profit even if they rarely do get caught in the act (and that is not often)!

    No one ever goes to jail for ‘invention theft’ or plagiarism in America and this needs to change in the information and technology age, since soon there will be little else of any real value, EXCEPT new and creative ‘ideas’. Everything else will be able to be done by computers (including law), so that ‘invention’ and art will soon be the ONLY THINGS that computers will still have difficulty in mastering, because they’ll likely never become human and so will never know what humans really need or want (or would be willing to pay for). Therefore IP and patents could (once again) become one of the ‘most valuable currencies’ of the future, provided our patent system gets totally revamped, re-written from scratch and finally starts working again as it was ‘originally intended’ to work!

  • [Avatar for Anon]
    Anon
    December 7, 2022 09:35 pm

    Any “durability” is supposed to already be there courtesy of paying through the prosecution steps.

    Any attempt to merely want “inventors to pay more” runs the very real risk of making this a Game of Kings.

    The author here is going about this the wrong way.

  • [Avatar for Pro Say]
    Pro Say
    December 7, 2022 05:06 pm

    Respectfully, this is gobbledygook.

    Gone wild.

    So many patent/ing options and variables would do nothing but open a pandora’s box of new, intractable problems.

    For all stakeholders.

    As just one example, the MPEP would explode by at least 25%.

    With one result being Examiners (and CAFC “judges”) would quit en masse.

    As another example, infringers and other patent attackers would have a field day challenging issued patents on a slew of new bases.

    Meaning the courts — including the CAFC — would be buried in new actions and motions.

    To say nothing of the fact that a number of these changes are contrary to international treaty agreements.

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