America’s Broken Patent System Must Return to First Principles | IPWatchdog Unleashed

The United States patent system is not failing because Americans have stopped inventing. It is failing because the legal and institutional architecture built to protect invention no longer operates as a coherent innovation framework. Over time, the patent system has become a patchwork of overlapping tribunals, inconsistent legal standards, procedural inefficiencies, and doctrinal barriers that make it harder to obtain, defend, enforce, license, and rely upon even high-quality patent rights covering innovations of extraordinary consequence.

That was the premise of our closing panel the IPWatchdog’s annual Patent Masters™ program, titled Building the Next Patent System: A Blueprint for U.S. Innovation, which we published as our latest episode of IPWatchdog Unleashed. The goal was not to debate the latest USPTO rule package, parse the newest Federal Circuit panel decision, or speculate about whether a pending bill might limp across the finish line after being gutted of anything useful. The goal was more ambitious: to begin a first-principles conversation about what a modern American patent system should look like if we were serious about promoting innovation, investment, commercialization, competition, and technological leadership.

Untethered from Incrementalism

As I explained at the outset, I want this conversation to be “untethered to existing bills and untethered to existing rules packages.” The patent community too often limits itself to what seems politically feasible in the moment. That is a recipe for uninspired incrementalism at a time when incrementalism is no longer enough and inspiration is absolutely essential. I have long talked about needing our own 1952 moment, the kind of structural rethinking that produced the 1952 Patent Act. And we could also use the big, bold thinking really last exhibited in the late 1970s and early 1980s with the creation of the Federal Circuit, and the passage of Bayh-Dole and then Hatch-Waxman. In other words, we need the type of policy coherence and purpose that once helped fuel decades of American technological dominance.

The panel for this conversation brought together an extraordinary mix of experience: Judge Pauline Newman of the Federal Circuit; retired Federal Circuit Chief Judge Randall Rader; Scott McKeown of Wolf Greenfield; John White of Harness IP; and Colin Sandercock, Vice President and General Counsel of Cue Biopharma. What made the conversation valuable was not unanimity. It was the willingness to confront the system’s failures without pretending that one constituency can or should get everything it wants.

The System Must Work for Everyone—But It Must Work

Colin Sandercock framed the problem in practical terms. He acknowledged that there should be an administrative forum to challenge patents because district court litigation has become extraordinarily expensive, time-consuming, and inefficient. But he also emphasized that any administrative process must be fair to patent owners as well as implementers. His formulation was on point: “We need a patent system that everybody can live with.” That does not mean a lowest-common-denominator system. It means a system that recognizes patents as commercial instruments, investment-backed assets, and public-interest tools—not merely litigation artifacts to be endlessly challenged until exhausted.

John White turned the discussion to constitutional first principles. He reminded us that Jefferson and Madison debated whether to include a patent system in the Constitution and ultimately chose to do so because disclosure in exchange for exclusivity was understood as essential to progress. John’s core point was simple and powerful: the system must deliver clarity and predictability. As he put it, “If we don’t have predictability in our system, you won’t have participation in our system.” That should be the North Star for reform. Investors, inventors, universities, startups, and operating companies cannot rationally deploy capital into uncertainty. If a patent cannot be trusted, financed, licensed, or enforced without years of legal combat, the incentive structure collapses.

Judge Rader pushed the conversation in a more forward-looking direction by suggesting that artificial intelligence could play a substantial role in patent examination. His proposal was not to remove human judgment entirely, but to use AI to identify prior art, make an initial patentability assessment, and allow senior examiners to provide final review. With the USPTO facing a scale and speed problem and increasing need to raise the quality of examination in order to settle ownership and give greater confidence in examination decisions, this is an idea that deserves serious consideration. AI will not solve all of those problems, and no one should pretend otherwise, but a modern patent system cannot ignore the possibility that examination can be faster, more rigorous, more predictable, and provide greater certainty through intelligent deployment of technology.

Judge Newman placed the conversation in historical perspective. She explained that major reform tends to arise when the law falls out of alignment with technological and economic reality. That is where we are today. The law has not kept pace with artificial intelligence, diagnostics, software-driven innovation, life sciences, platform technologies, or the realities of global competition. And one of Judge Newman’s most important contributions to the conversation was her insistence that meaningful change will be difficult, but not impossible. “The great revelation to me is that change can be made,” she said. That insight matters because the patent community has become conditioned to expect disappointment—but resignation is not strategy.

Reform Is Possible, but Politics Is the Constraint

Scott McKeown brought the political reality into focus. His concern was not the absence of ideas; it was the dysfunction of the current legislative process. He observed that Congress has struggled for years to address Section 101 despite broad recognition that the law is broken. In the absence of congressional action, agencies increasingly drive policy, resulting in a system that can shift dramatically every four or eight years depending on political control. That is not a stable innovation policy. A patent system cannot depend on administrative oscillation. Investors do not fund uncertainty. Companies do not build long-term strategy around temporary guidance documents. Durable rights require durable rules.

This is why I believe the timing is right for a broader conversation, which will hopefully result in a blueprint for the future. As I pointed out during the panel, we are losing congressional leaders who understand IP and who have also devoted substantial time to issues that matter to the IP industry. Senator Thom Tillis is retiring. Congressman Darrell Issa is retiring. Senator Marsha Blackburn is running for governor of Tennessee. Senator Dick Durbin is retiring. Congressman Thomas Masse did not win his primary. So, while Senator Chris Coons can be expected to remain genuinely interested in IP issues, he is likely to find himself without a committed partner on the Republican side, and few allies on the Democrat side. Thus, patent legislation will be difficult to move in Congress. And while that reality is disappointing, it also creates a strategic opening. If Congress is unlikely to act immediately, the patent community has time—perhaps four, five, or six years—to build something serious, comprehensive, and intellectually defensible.

Eligibility Remains the Threshold Question

Everyone seems to universally agree that the threshold issue is patent eligibility. Scott identified Section 101 as the most fundamental question: what can be patented? John agreed, drawing on Chakrabarty as an example of how a single eligibility decision helped unleash an entire biotechnology industry. Today, by contrast, eligibility doctrine has chilled investment in diagnostics, software-enabled inventions, and emerging AI technologies. This is not merely an inconvenience. It is a policy failure. If America cannot define patent-eligible innovation clearly, other jurisdictions will capture the investment, talent, and commercial upside as innovators and their companies move to more favorable jurisdictions—as happened when the biotech sector moved to the U.S. after the Supreme Court’s decision in Chakrabarty.

But eligibility is only one part of the problem. Patent rights must also be enforceable. The erosion of injunctive relief after eBay has weakened the exclusionary character of patents, particularly for entities that rely on licensing or commercialization partnerships. At the same time, Scott rightly cautioned that injunction policy cannot ignore abusive litigation models or the realities facing large operating companies targeted by serial lawsuits. That is precisely why reform must be comprehensive and balanced. A serious patent system must protect innovators without enabling opportunistic litigation leverage untethered from real innovation and commerce.

Too Many Forums, Too Little Coherence

We also discussed the structural problem created by multiple forums deciding validity under different standards and institutional incentives. District courts, the ITC, the PTAB, and the Federal Circuit all play roles, but the system often feels less coordinated and adversarial. As I explained, we have seen situations where the same patent claims are treated differently depending on the procedural path by which they arrive for review at the Federal Circuit. That should not happen. A rational system needs defined lanes, consistent standards, and a final reviewing authority capable of producing stability rather than compounding uncertainty across agencies and courts that most often seem to be working against one another.

One idea raised during the discussion was the creation of specialized patent trial courts or designated patent venues with judges who regularly handle patent cases and have the resources to do so competently. That concept is not new, and past efforts such as the patent pilot program fell short in part because they were not adequately funded. But the underlying logic remains sound. Patent cases are complex. They involve technology, claim construction, damages, validity, infringement, commercial context, and often global business consequences. A judge who sees one patent case every few years is unlikely to develop the fluency necessary to manage those disputes efficiently. And fundamentally, what exactly is wrong with judges who want patent cases from actually getting more patent cases?

Patents Must Be Investable Property

The deeper problem is that many decision-makers do not fully understand how patents function in the real economy. For a startup, university, small or medium-sized enterprise, or research-driven company, a patent can be the asset that makes investment possible. If the technology fails commercially, the patent may still preserve residual value. But if the patent itself is perpetually vulnerable, the asset disappears. That undermines financing, licensing, acquisition, partnership, and commercialization.

This is why patents must be understood as property—not merely as government franchise as the Supreme Court has stated. And it isn’t enough to say a patent has attributes of personal property, as the statute says. It is critical for patents to once again be viewed as real property, as the Supreme Court did once upon a time, because if patent rights are not investable, they cannot perform their constitutional function. Capital formation depends on confidence. Confidence depends on enforceable rights. Enforceable rights depend on a system that is clear, predictable, and institutionally coherent.

The ultimate takeaway from our conversation was not that reform will be easy, because it won’t be easy. Powerful stakeholders disagree on the purpose and future of the patent system. Industries require different incentives. Congress is dysfunctional even when they are motivated to do something. Courts have created doctrinal confusion and continue to refuse to interject even a modicum of certainty. Agencies are filling policy gaps they were never designed to fill, which just means with every new Administration priorities and approaches can and do shift.

Building the Next American Patent System

Against this depressing backdrop, the patent community should stop waiting for the next narrow fix and start building the new framework. We need practitioners, judges, inventors, investors, universities, operating companies, policymakers, and industry leaders in the same conversation. We need to focus on first principles and institutional design. We need a system that rewards disclosure, supports investment, respects property, enables fair competition, and gives America’s innovators a reason to innovate and build here.

The United States became the world’s innovation leader because it once understood that patent rights are not a sideshow, but core infrastructure that enables the creation of technology that will power the future. If we want the next generation of transformative technologies to be invented, funded, scaled, and commercialized in America, we need a patent system worthy of that ambition. Our conversation at Patent Masters was only the beginning, but it was the right beginning. Now in the coming months we will move forward with a candid, serious, historically grounded, and focused conversation on building—not merely patching—the next American patent system.

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