Game of Patent Thrones

By Raymond Van Dyke
September 10, 2014

Just as in the land of Westeros, there is turmoil and intrigue in our government as to who is to lead the United States Patent & Trademark Office (USPTO).  Indeed, the top position of Under Secretary of Commerce for Intellectual Property and Director of the USPTO has been vacant since the resignation of David Kappos on February 1, 2013.  His deputy, Teresa Stanek Rea, became Acting Director, but she was not elevated to his post.  She resigned on November 21, 2013, which left both positions unfilled.

On January 13, 2014, Michelle Lee, former head of Patent and Patent Strategy at Google, was appointed Deputy Under Secretary of Commerce for Intellectual Property and Deputy Director of the USPTO, and in the ongoing absence of a Director, she holds the fort as Deputy Director, but with her position in administrative law limbo.  Despite the clear need for leadership at the USPTO, the search for the next Iron Throne holder is mired in ideology and lobbying.

Although the current administration talks the talk of promoting invention and innovation, they are influenced by special interests that have negative views regarding patents and the patent process, particularly in view of the “patent troll problem.”  Unfortunately, it appears that the reason for the long delay in selecting a USPTO head lies almost exclusively with the administration’s and Congress’ views on the patent troll issue, i.e., the head person must be willing to make whatever changes to the patent system to curtail patent trolling, apparently regardless the effect on the patent system as a whole.

The troll issue should be addressed, but by fair means, not by laws that will inadvertently cause unfair burdens to all inventors, result in barriers to innovation, and perhaps seriously damage the U.S. economy by diminishing the value of intellectual property.  American ingenuity and creativity should be encouraged, and only bad actors and bad actions sanctioned.

Patent law has historically been a quiet area of law, with sporadic historical outbursts, such as with Alexander Graham Bell, the Wright Brothers and others who transformed society with their innovations, and others seeking to partake in such successes by challenging them.  Over the last few decades, however, there has been an explosion of many technologies, with modern innovators creating transformative products, e.g., smart phones, biotechnological advancements, software, and other innovations that enrich our lives and promote our success as a nation. There has been much litigation on many of these lucrative technologies.  Everyone wants a piece of the pie, and frankly, when one invention leapfrogs off the back of another, it is sometimes difficult to figure out who should profit.  However without profit as an incentive, neither the poor geek spending nights and weekends in their garage, nor the major corporations, would be motivated to innovate and we’d all suffer.

For many small inventors, e.g., individuals and universities, it is difficult to fully participate in the patent system, and deal with licensing and enforcement, because of growing barriers to entry, such as legal fees. Thus, many small inventors and universities are forced to collaborate with or sell their patented innovations to others, who are better positioned to approach patent infringers.  A small percentage of these helpers are the so-called patent trolls, i.e., those abusing the patent system by improperly asserting patent rights.

Think of it this way.  Most universities and small inventors do not have the ability to manufacture and market their inventions themselves. They don’t have the contacts, nor the startup capital – in fact, another TV program, Shark Tank, makes the difficulties for the small, home-grown inventor clear. These inventors might not have the business acumen, but they do have the ideas and innovations that can improve all of our lives, provide jobs, and contribute to the U.S. economy.  They just can’t do it by themselves.  Under the proposed laws every investor on Shark Tank might be called a troll.

The majority of patent suits do not actually involve “troll” issues, and only a small percentage involve inappropriate actors, i.e., actual trolls acting abusively. The term patent troll, coined by large corporations to denigrate patentees suing them, is now used to designate anyone filing suit on a patent, whether an abuser of the patent system or not.  Indeed, some large tech companies being so sued and the reactive press now attack the entire patent system for the actions of those few improper actors, and have gotten the current administration and Congress involved in the patent process and hysteria for patent reform.

Despite the recent passage of the America Invents Act (AIA) of 2011, the most comprehensive change to the U.S. patent system since 1836, Congress soon acted to pass further legislation.  Indeed, before the ink on the AIA was dry and before full implementation of the Act, significant changes were being proposed to ostensibly address the patent troll problem.  On December 5, 2013, the House of Representatives passed H.R. 3309, the Innovation Act, with various controversial positions, e.g., fee shifting, which would adopt the “English rule” in damages where the loser pays the legal fees of the prevailing party in “unreasonable” patent suits, and make significant changes in notice pleading.  Although some provisions of H.R. 3309 were sensible, little thought went into the impact of these new requirements to the patent system to all patent holders, whether engaging in abusive trolling or not.  Indeed, some of the notice requirements were particularly burdensome to every patent holder and every patent applicant, seriously undermining the entire patent system.

Imagine a rightful patent holder, trying to stop an overt infringer copying his invention, and the infringer, making huge profits on their theft, hires a large law firm, turning on litigation full blast. How could this little guy even contemplate protecting his rights when faced with a Goliath who could turn a small litigation into one costing millions?  How many of these rightful patent holders might be intimidated into not even entering the court system?  Instead, under our current system, a judge has the right to award damages under inequitable circumstances, including fee shifting.  This is vastly different from a proposed system that mandates a winner-take-all philosophy. Similarly, individuals and small companies subject to improperly-asserted patents already have the right to fee shifting or other equity if the judge views the litigation baseless.  There must be some discretion before levying these harsh penalties, and judges should remain in control of the process.

The legislative controversy came to a head in the Senate on May 21, 2014, when the Senate version of the bill, called the Patent Transparency and Improvement Act, was removed from the Senate calendar, enraging the Bill’s sponsor, Senator Leahy, who blamed the trial lawyers.  However, many in the patent community also objected to the Senate Bill, including the biopharmaceutical industry and universities, who noted that both the House and Senate Bills lacked target to the particular problem, bad actions by trolls, and instead adversely affected the entire patent community. For these reasons, the Senate Bill was shelved.  Littlefinger would be proud.

With all this Congressional turmoil, the search for a new USPTO Director continues without success.  A couple of months ago, however, the press was abuzz with Phil Johnson, Senior Vice President for Intellectual Property, at Johnson & Johnson being vetted for the position.  However, despite Mr. Johnson’s extensive expertise in patent law, his candidacy was contested because of some pro-patent positions he took.  Apparently, one needs to toe the party line for such consideration, which does not bode well for the patent system. Shades of the Red Wedding?

Talk now is that Ms. Lee is finally being considered for the Director position.  After leaving the Director position vacant for a year and a half, and passing her and Ms. Rea over, both highly-qualified candidates, will this administration and Congress, like the medieval lords in Game of Thrones, consider a Daenerys Targaryen to ascend the Patent Throne? Sadly, with the powers at work against the patent system, without someone to lead, as they say in Westeros, winter is coming.

The Author

Raymond Van Dyke

Raymond Van Dyke has been an intellectual and technology attorney and consultant for over 25 years, specializing in IP procurement, prosecution, IP portfolio building and management, licensing, legislative advocacy and expert witnessing. He is licensed to practice law in Washington, DC, Maryland, New Jersey, New York, Texas, and the Patent & Trademark Office of the United States. He is also admitted to practice before the Supreme Court of the United States, the Court of Appeals for the Federal, Second, Third, Fourth and Fifth Circuits, as well as the Federal Court of Claims and the Court of International Trade. For more information or to contact see his profile at Van Dyke Law.

The views expressed in the article are his own and not those of his clients or organizations.

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Discuss this

There are currently 14 Comments comments.

  1. American Cowboy September 10, 2014 9:35 am

    Why the pseudonym? Sue didn’t say anything controversial, to my read.

    Or has political correctness married crony capitalism and totalitarianism to the point that she gets in trouble for any criticism of HE WHO MUST BE OBEYED?

  2. Randy Landreneau September 10, 2014 9:54 am

    Wow. Someone who is pro-patent can’t become USPTO Director. What the hell has happened to this once great nation?

    Randy Landreneau
    Independent Inventor

  3. Anon September 10, 2014 10:49 am

    American Cowboy,

    The use of a pseudonym (and anonymity in general) has been a respected mechanism throughout this country’s legal history and should not be confused with use ONLY in a “fear of retribution” mindset.

    Buying into that mindset is as errant as buying into a “patent system only exists to support innovation that would not be pursued “but for” the patent system.

    Each, while possessing a grain of truth, is too easily manipulated into a fear-mongering FUD tool that has no place among men of reason.

    Instead, may I recommend that one focuses on what is said, and eliminate the desire to place importance on the who is saying it? Focus on the message, not the messenger.

  4. John Darling September 10, 2014 11:45 am

    The Federalist Papers were written by Alexander Hamilton, John Jay, and James Madison under the pseudonym Publius.

  5. Jaqen H'gar September 10, 2014 12:24 pm

    Interesting article, and fun with the Game of Thrones connection. I was actually thinking of Game of Thrones the other day when I noticed the article about Lemley; would a good nickname for him be ‘Littlefinger’? I haven’t read the books, but in the TV series so far I was very struck by Varys’ statement about Littlefinger to the effect that he would let the whole kingdom burn if he could rule over its ashes. Lemley seems to have a similar attitude towards the patent world, except that of course there is no throne.

  6. Gene Quinn September 10, 2014 1:32 pm

    Randy-

    I’m afraid that is consistent with what I am hearing. There are at least two factions involved. There are those who want and need strong patent rights (i.e., pharma, bio, universities, inventors, start-ups, big companies that actually innovate — think IBM, Qualcomm) and there are those who want to dismantle the patent system (i.e., Google, Cisco, et al). Those who would be supported by one faction would never be supported by the other, or so it seems. With President Obama so close to Google in so many ways it seems unlikely that he would appoint someone who was pro-patent when the Google official lobbying position is that they hate patents and the patent system shouldn’t exist at all.

    Sad.

    -Gene

  7. Randy Landreneau September 10, 2014 1:58 pm

    Gene-

    Thank God there are at least a few large companies that oppose some of what the anti-patent faction wants. But most of the “IBMs and Qualcomms” will go along with legislation that doesn’t impinge to heavily on them if it will further curtail the ability of an independent inventor to sue them for legitimate patent infringement. This includes legislation that would eliminate the ability of the typical independent inventor to litigate but would not eliminate the ability of the large entity to litigate. If such legislation passes, independent invention of anything significant, a key part of the DNA of America, will be tragically lost.

    Randy Landreneau
    Independent Inventor

  8. Anon2 September 10, 2014 2:29 pm

    Anon @3 Good point.

    And… are you anon of Pantently-O commentary? If so you are missed.. and what happened?

    Did you decide to “shrug”?

  9. patent leather September 10, 2014 3:06 pm

    Michelle Lee is now being considered for Director? Someone who talks about protecting inventions with an open source model “but not patents”? How can we prevent this from happening? I would even rather have John Doll back than her.

  10. D. Stringer September 12, 2014 11:47 am

    Isn’t it interesting that Google, who holds so many patents, is anti-patent?

  11. John Darling September 12, 2014 11:49 am

    Not really. We have a lot of nuclear weapons, but we’re pretty anti-nuclear weapon when it comes to other countries having/getting them.

  12. D. Stringer September 12, 2014 12:23 pm

    Good point.

  13. Raymond Van Dyke September 12, 2014 1:09 pm

    Gene:

    Thanks for publishing this seminal article. Hopefully, the power that be are listening.

    Ray

    Van Dyke Law
    202.378.3903
    vandyke@acm.org
    truth ahee aim

  14. Gene Quinn September 12, 2014 4:30 pm

    D. Stringer-

    Google’s anti-patent positions is one of the more strange things I’ve encountered. Their view of patents is schizophrenic to say the least. Obviously someone who controls the patent budget really likes patents despite the fact that the CEO and his DC lobbying arm is continually trying to undermine and ultimately destroy the patent system and their entire portfolio.

    -Gene