Clause 8: U.S. Chamber Resetting the Narrative on IP Rights in America

UC Berkley Law Professor Colleen Chien recently shared the following advice with The Hustle –  the self-proclaimed “5-minute newsletter keeping 2.5M+ innovators in the loop”:

“The basic rule of thumb is, if you can keep it secret, keep it secret. But if you can’t — because when you sell the product, it reveals how the product works or shows your design — think about patent protection.”

In other words, obtaining patent protection is the worst possible option for innovators in America besides possibly not doing anything to protect your innovations.

Startling, arguably solid practical advice for the average entrepreneur from a law professor.

However, Chien isn’t just a law professor: she was listed as part of the U.S. Patent and Trademark Office (USPTO) Director’s leadership team until at least last week and previously served on Biden’s transition team and as an IP policy advisor in the Obama White House. So, coming from her, that advice is also a particularly revealing analysis about the state of IP rights in America.

How did America get to this point? Is that the patent system America wants or needs? A patent system that discourages collaboration and sharing of knowledge? A patent system that innovators should think twice before relying upon?

America’s COVID-19 vaccine miracles and leadership in the mobile phone revolution were still possible because of a functioning patent system. However, the success of anti-IP activists over the last 15 years has left many in the pro-innovation community feeling uneasy about whether a similar track-record of American achievements will still be possible in the future.

To make sure that “America`s best days are yet to come,” Patrick Kilbride and Brad Watts of the U.S. Chamber of Commerce’s Global Innovation Policy Center (GIPC) are leading an initiative to bring together a diverse group of stakeholders to help create a new narrative on IP rights in America.

The initiative was publicly launched with the release of the IP Principles document to provide “a North Star” for advocates and policymakers working on IP issues.

On this episode of the Clause 8 podcast, Patrick and  returning guest Brad join Eli to talk about this initiative, the current narrative on IP rights and the forces that shaped it, the themes of the IP Principles document, and what they hope to accomplish. They also discuss why the U.S. Chamber cares so much about IP issues, whether patents are underappreciated compared to other IP rights, and much more!

How Reliance on Trade Secrets v. Patents is the Canary in the Coal Mine

“If, for instance, a large segment of U.S. industry is treating patents defensively instead of investing in a portfolio for its own sake for the sake of building assets, that’s a canary in the coal mine that tells us that we have a problem. If they’re securing their most valuable intellectual assets through trade secrets instead of through the patent system, that tells us there’s a problem.”

IP Principles as the North Star for America’s IP System

“The IP system needs to be a reliable basis for investment and high risk, capital intensive, long term projects that lead to innovative and creative outcomes. The IP system needs to facilitate dissemination of knowledge, disclosure, collaboration, and technology transfer throughout an ecosystem. If we know that those are objectives, then we look at the set of rules and laws that have emerged and we can course correct or necessary to make sure we’re still pointing. So you know, the purpose of doing these IP Principles is to provide a North Star so that we can recognize when we go off course.”

On IP Rights being the Ultimate Social Good and Democratizer

“Individuals who don’t have the same views we have about intellectual property have – over 10, 15, 20 years – created a sustained narrative that, as Patrick noted, that somehow strong IP rights are connected with corporate greed, or that somehow strong rights for creators that is going to lock up culture, or that patents only benefit big businesses. And we know that’s not the case, right? IP rights are the ultimate social good, because it’s what allows new ideas to come to market, products that make life better for everyday Americans, not just medical products. But think of all the modern technology we have, new movies, new books, new films. IP rights are critical. And especially for small businesses, IP rights are the ultimate democratizer. Why? Because they give them an ability to monetize their intellectual assets against competitors.”

Why We Need America to Lead on IP

“Who do we want setting the global standards for new and emerging technologies? And I think about the internet. Part of why we have today, a free and open internet, that has done so much good for the economy, for society, for human rights, for the dissemination of information is because the United States where the Internet was developed, right, where our companies took the lead, we set the standards early on of free speech, freedom of dissemination, a free and open Internet. And Andrei Iancu has talked about this quite a bit: in the technologies of the future – Quantum, Artificial Intelligence – do we want the United States setting the standards for those technologies? And I think what I would argue, and many of our member companies would argues yes, that our standards, as Patrick noted, comply with the rule of law and a legal framework that is free and fair and open. And it may not always lead to the results you like, but it is predictable.”

Other Highlights:

03:04   Brad’s decision to join GIPC after working for Senator Thom Tillis

15:13   Importance of IP rights for national security, competitiveness, and economic inclusion

27:31   Companies protecting assets through trade secrets v. patents

34:52   China’s rule by law vs. US’s rule of law

38:52   Criminal penalties for patent infringement?

39:56   Who is to blame for “efficient infringement” being a business tactic?

47:12   Disparity in enforcing patent rights versus other IP rights?

49:53   Need for IP system to be a reliable basis for investment

56:13   Why context matters for role of litigation funding

58:39   Eagerness to find common ground among stakeholders involved in initiative and  enthusiastic response from the IP community