Posts in Guest Contributors

Are Software Patents Stifling Innovation?

What if (Almost) Everything You Thought You Knew About America’s “Broken” Patent System Was Wrong? What follows is the fourth and final installment in the “Myths of the Patent Wars” series. The necessary legislative effort to curb bad actors in the patent industry has been “hijacked” by a small handful of very powerful global technology companies intent on forcing broader…

The ITC and Excessive Patent Damages Myths

Professor Paul Janicke of the University of Houston Law School conducted a study of all damage verdicts in patent infringement cases between 2005 and 2007. He found no pattern of “runaway jury awards.” In fact, many of the biggest damage awards of that time, including the $1.5 billion award Lucent won from Microsoft, were set aside or greatly reduced by the judges. Even Apple’s $1 billion 2012 patent verdict against Samsung was recently slashed 43 percent. Why, then, are claims of a “broken” patent system rife with “excessive damage” awards so widely believed?

Fortune Magazine’s Unusual Position on Non-Practicing Entities

In a magazine with the name Fortune—devoted to capitalism and free markets—it is surprising to see an article that would promote closed markets and limited ownership of property within its pages. I doubt Fortune would support laws restricting real estate ownership to those who build on the land and live on it. I doubt Fortune would consider supermarkets to be “grocery trolls” because they sell goods from others that the stores never actually produce. It is time to reconsider these foolish restrictions on intellectual property ownership and return to treating intellectual property as we do all other property.

Are Non-Practicing Entities The Problem?

Patent licensing, in fact, was the principal means by which new inventions were commercialized during the decades before in-house corporate R&D departments emerged in the early 20th century. Publications such as Scientific American were founded expressly to facilitate the trade in patents, and it regularly featured descriptions of new and interesting patents, which commercial enterprises then licensed or purchased to use in their product development efforts. American Bell Telephone’s new product pipeline, for example, operated like most others at the time. According to its 1894 annual report, the company’s R&D department licensed 73 patents from outside inventors, while developing only 12 from its own employees.

Leveraging Spin-Out Companies to Support Global Health

IDRI granted license rights to its world-class vaccine adjuvants to Immune Design Corporation (IDC), which was established in Seattle in 2008 with a focus on cancer, allergies and certain infectious diseases. The royalties and other funds received from IDC have helped to support IDRI’s programs, and IDC’s clinical safety data relating to the adjuvants have been vital in IDRI’s ability to accelerate the development of vaccines for tuberculosis and leishmaniasis, two diseases with an immense global health burden.

Myths of the Patent Wars: An “Explosion Of Patent Litigation” Greater Than Any in History?

These deceptive claims are meant to justify and buttress a legislative agenda aimed at immunizing this small coterie of technology giants from the costs of their patent infringing behavior… The estimated 124-plus smartphone patent suits filed between 2009-2012 are less than one-quarter the number of patent suits filed during the first “Telephone Wars” of Alexander Graham Bell’s time. Back then, the American Bell Telephone Company and its successor, AT&T, litigated an astonishing 587 patent cases alone. Even more surprising, given the common belief in a patent litigation “explosion” today, patent and legal records from the golden age of the U.S. Industrial Revolution in the mid-19th century show that the patent litigation rate at that time — defined as the number of patent suits filed in a decade divided by the number of patents issued in that decade — reached 3.6 percent.

What Your Smartphone Would Be Without Patents

Ask yourself for a moment, how does a smartphone fitting in the palm of my hand simultaneously download my emails while I watch high-definition YouTube videos of Felix Baumgartner jumping out of a hot air balloon, even as the smartphone figures where I am, where my work is, calculates the traffic delay and lets me know all this and stock quotes too while I keep watching the videos? I didn’t even mention the incoming text from my workout partner with an embedded picture of the beach where he is and I am not, captioned “WHERE R U?” And how can my smartphone do all that at the same time all my neighbors’ smartphones are using the same finite amount of radio frequency spectrum to accomplish the same tasks while they watch dog-shaming videos? The answer, however mundane it sounds, is as powerful as magic and just as invisible: high-data-rate wireless connections.

Git’er Done! Take the Brake Off Federal Tech Transfer

Any government truly interested in commercializing its research must realize that time is of the essence, risk is inherent in the process and deal makers should be supported by process. Napoleon adopted the motto: “Not a moment must be lost.” But quoting Napoleon may be too intimidating for times like these, so how about Larry the Cable Guy? Perhaps we still retain enough of the American spirit to embrace: “Git ‘er done!” Time will tell (perhaps sooner than we imagine). We’ve been trying to drive the federal R&D system with the parking brake on. It’s time to put product people behind the wheel, buckle the process people safely in, release the brake, hit the gas and get rolling. Those that used to be far behind are coming up fast in our rear view mirror.

Compulsory Licenses Won’t Solve a Healthcare Crisis

Over the past two years, India has invalidated or otherwise attacked patents on 15 drugs produced by innovative pharmaceutical firms. While the claim is that this promotes lower prices and expanded access to medicines, in truth this is industrial policy not health policy. The clear beneficiaries are local generic manufacturers, not Indian patients. The majority of Indians do not need Nexavar, or any of the other patented drugs being considered for compulsory licenses. They need doctors, nurses, clinics, and hospitals. Put simply, a functioning healthcare infrastructure. Basic health statistics clearly illustrate the real problem, India currently accounts for one-third of the deaths of pregnant women and close to a quarter of all child deaths.[3] The battle for health in India will not be won with compulsory licenses. It will be won with investments of resources on the ground in local communities.

Patent Legislation Gives FTC Power to Regulate Demand Letters

Sen. McCaskill introduced S. 2049 in February 2014 which would require the FTC to promulgate rules to prohibit unfair and deceptive acts and practice in the sending of patent demand letters, including requiring each such letter to identify the patent number, the claims, a description of the manufacturer and model number of each accused product or service, notice that the recipient may have the right to have the manufacturer defend against the infringement, the identity of the person with the right to enforce (including each owner, co-owner, assignee, exclusive licensee, and entity with the authority to enforce the patent, and the ultimate parent entity), any FRAND licensing commitments, any basis for a specific license amount, and each PTO proceeding or litigation involving the patent. Bad faith assertion would be enforceable by the FTC or attorney general of a State in federal court.

Alice at Court: Stepping Through the Looking Glass – Part II

There is a further gulf between those who view In re Alappat as sound logic and engineering (ABL, AIPLA, Alice, Mr. Ronald Benrey, BSA, CCIA, Mr. Dale Cook, Prof. of Computer Science Lee A. Hollaar, IEEE-USA, Microsoft) and those who it as mistaken (Electronic Frontier Foundation, Prof. Robin Feldman, Red Hat) and primarily responsible for an increase in such patents (Electronic Frontier Foundation, Google, “Law, Business and Economics Scholars”). The IEEE-USA provides an excellent analysis of the relationship between software and hardware, pointing out the incontrovertible principle of equivalency, that “special-purpose programming of general-purpose hardware” is “equivalent to special-purpose hardware,” though IEEE-USA fails to mention that this is a fundamental principle of computer science, as established by Alan Turing in the 1930s. To assert, as does the EFF, that the Federal Circuit “concocted” the equivalency of hardware and software goes beyond denying the foundational work of Turing and others. The equivalency of software and hardware is what makes it possible for Java to run on any type of computer using the Java Virtual Machine, as well the electronic design automation industry, which enables complex electronic circuits to be entirely designed in software before being implemented in hardware.

Alice at Court: Stepping Through the Looking Glass of the Merits Briefs in Alice v. CLS Bank – Part I

The fractured views of the world begin with the question presented, and reflect how different parties frame the debate in very different terms. Alice’s merits brief presents the question before the Court as “whether claims to computer implemented inventions…are patent-eligible.” Putting the question this way allows Alice to place its inventions and claims in the larger context of all computer-implemented inventions, the subtext being that if the Supreme Court holds that computer-implemented inventions are patent eligible—which is a fair bet—then Alice’s patents should be valid. Further, phrasing it this way allows Alice to distance itself from pure business method claims from the invalid claims in Bilski v. Kappos.

Patent Quality in China

As a result of filing the world’s highest number of patent applications, China is often attacked for trading in quality for quantity. However, Michael Lin of Marks&Clerk explains that a better understanding of the State Intellectual Property Office (SIPO) and the Chinese patent system shows that patent quality is in fact, not declining but increasing.

Patent Legislation Compared: Joinder of Interested Parties

Opponents of the rule point out that it could lead to unwilling and unnecessary joinder — a point raised particularly by universities and venture capitalists who fear they may be hauled into costly patent litigation against their will if their licensees/startups ever need to enforce their patent rights in court. Still others point to the fact that these joinder provisions would only apply to patent cases — and only against plaintiffs — and would thus create a litigation process unique to patents in district courts. Furthermore, district court judges would lose most of their existing broad discretion to determine whether the facts truly warrant joinder in each unique case.

Congress and the Court: Loser-Pay Fee Shifting

U.S. patent litigation has followed the centuries-old “American Rule” under which each party to a litigation pays its own legal fees and costs, regardless whether it wins or loses the litigation. A narrow exception exists in patent cases, but only in “exceptional cases” under 35 U.S.C. § 285, such as where the losing party engaged in litigation misconduct, or if the patent was fraudulently procured, or if the losing party raised arguments that were both objectively baseless and made in bad faith. Despite the long tradition of litigants paying their own legal fees and costs, Congress has shown interest in changing the playing field and deviating from the American Rule in patent cases. This comes at a time when the U.S. Supreme Court is already considering two cases that relate to the definition of “exceptional cases” in § 285 that may well alter how this existing exception to the American Rule is applied in practice.