Hakuna Matada Isn’t a Strategy for Paradigm Shifting Innovation

By Gene Quinn
November 16, 2017

Wouldn’t it be a great world if people innovated for the sake of innovating, spending every waking moment in the pursuit of solutions and inventions that would better mankind?

Wouldn’t it be a great world if investors, the top 1% and the richest corporations would invest hundreds of millions of dollars, even multiple billions of dollars, and fund the many years of arduous work from large teams of scientists and engineers necessary to achieve paradigm shifting innovation?

In such an idealized world innovation would happen just because— well because it would just happen.

Innovation would be would be free. It would be plentiful. There would be no costs associated with the resulting inventions, and those with the skills to achieve hall of fame level innovations and those with the capital necessary to achieve those paradigm shifting innovations would simply donate their time and money for the betterment of humanity.

Hakuna Matada isn’t a patent strategy. And it isn’t a national innovation strategy either.

Of course, that idealized world where everything is free, inventors donate all their time, and investors give money away without any expectations of returns only exists in the imaginations of a few anti-patent loons. The rest of us understand that if those with the skill to innovate simply spent all their time innovating for free they would be broke, their families would be destitute, and the end result would be no innovation, not more innovation. Similarly, if those with the capital cannot achieve an acceptable rate of return on their money eventually they would run out of that money. So even if a benevolent billionaire or two wished to pursue this model a few times it is hardly repeatable, and absolutely not sustainable.

But there I go introducing fact into what is an emotional, nearly religious conversation.

In certain circles if you support strong patent rights you are looked at as if you just confidently proclaimed the earth is flat. Yet, the mountain of evidence is on the side of a strong patent system being a precursor to fostering innovation, and innovation leading to the uplifting of economies. Indeed, never in modern history has there ever been a single economy that has succeeded without offering strong protections to intangible assets.

If you want to find the economies with failing economies just look for those without protections for intangible assets, year after year after year there is a direct correlation. See Global Innovation Index for 2017. The countries at the bottom of the list year after year are Yemen, Mali, Pakistan, Ethiopia, Rwanda, Zimbabwe, Niger, and Burundi, to name but a few.

Of course, the anti-patent crowd loves to proclaim “correlation is not causation,” as if saying that supports their position. But the evidence (see here, here, here, here, here, here, here, here and here) tells a different tale, or at the very least raises serious questions about why anyone would consciously consider the path of weak patent rights favored by those countries with virtually non-existent economies.

First, when correlation is 100% those challenging the correlation ought to bear a very heavy burden, and a catchy retort hardly meets that heavy burden. Second, there is a reason why there is perfect correlation – it is because without a functioning patent system innovations cannot be domestically protected and that means innovators cannot operate within that country because it is too easy for any employees to steal proprietary information and technologies. That, in turn, means in countries without a strong patent system foreign direct investment is artificially decreased. Third, we have numerous real life social experiments to witness that demonstrate when country after country has adopted stronger patent protections and protections for other intangible assets investment has increased, jobs are created and the economy begins to flourish. So while it probably feels good to say “correlation is not causation,” all the evidence is on the side of a strong patent system and absolutely no objective evidence is on the side of a weak patent system leading to a strong economy.

Furthermore, if a weak patent system is the answer to economic woes then why aren’t those countries with non-existent or extraordinarily weak patent systems not dominating the global economic landscape? Seriously, if patents just get in the way of innovation it stands to reason that in places where there are no patents or very weak patent rights the economy should be outrageously successful. Of course, that isn’t the real world experience, but it doesn’t stop academics and critics of the patent system from spewing such nonsense. Seriously, if anything they claim had ever worked in any nation one might be tempted to listen, but nowhere has a weak patent system ever delivered a robust economy. There are simply no examples.

Rather than pining for a fantasy world that does not exist, an idealism where inventors and investors give everything away for free, we should be acknowledging the human condition. Congress does this all the time with the tax code because it is widely known that tax incentives modify behavior. So why not actually incentivize innovation — the way America used to incentivize innovation and encourage inventors and startups to engage in risk taking calculated to lead to paradigm shifting innovation?

Simply put, you cannot modify behavior if your plan is to ask people to do something unnatural. No matter the incentive provided human beings will never fly by flapping their arms. Similarly, expecting innovation just to happen and those in the innovation ecosystem to donate everything without expectation of success and profit is not just a losing strategy, but a strategy of such epic stupidity it insults the intelligence anyone with a modicum of common sense.

Abraham Lincoln was exactly correct. The American patent system must provide the incentive that fuels creative genius. It did that for most of the 225+ year history of the patent system. Whether it will do that moving forward remains to be seen, but things are heading in a an increasingly negative direction in America, while they are looking up in both Europe and China. An unbelievable and truly sad commentary.

 

The Author

Gene Quinn

Gene Quinn is a Patent Attorney and Editor and founder of IPWatchdog.com. Gene is also a principal lecturer in the PLI Patent Bar Review Course and an attorney with Widerman Malek. Gene’s specialty is in the area of strategic patent consulting, patent application drafting and patent prosecution. He consults with attorneys facing peculiar procedural issues at the Patent Office, advises investors and executives on patent law changes and pending litigation matters, and works with start-up businesses throughout the United States and around the world, primarily dealing with software and computer related innovations. is admitted to practice law in New Hampshire, is a Registered Patent Attorney and is also admitted to practice before the United States Court of Appeals for the Federal Circuit. CLICK HERE to send Gene a message.

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

Discuss this

There are currently 22 Comments comments. Join the discussion.

  1. American Cowboy November 16, 2017 9:37 am

    Yes, indeed, inventions should be free to copy.

    And

    Doctors should care for patients without charging for their services.
    Teachers should teach children without expectation of a salary.
    Farmers should grow their crops and give them away at markets.
    Politicians should serve the people that elected them.
    Software developers should write their code and make it publicly available for copying without charging a royalty.
    Attorneys should work pro bono 100% of the time.

    Ah, wisdom comes late in life to some.

  2. angry dude November 16, 2017 10:13 am

    In a capitalistic society patents are a MUST

    The alternative is a totalitarian communist state where everything is planned, financed and controlled by the government with no profits going to private individuals
    aka old soviet union where they launched sputnik but could not make a decent mass-produced car…. forget cars, they couldn’t even make decent toilet paper
    – all because of the lack of private initiative

  3. Anon2 November 16, 2017 10:17 am

    AC@1

    Your sarcasm is valid, funny, and sad all at once. It may be a little harsh though.

    The article does attempt to provide reasons for supporting the patent system… it points to the economic consequences. Albeit, it may imply that “the pursuit of happiness” and an individual’s right to the “fruits of his or her own labor” are akin to a nuisance we must live with to achieve public prosperity, that self interest is the product of a flawed human nature we would otherwise wish were not there, but which can be used to the advantage of the so called public.

    I do not believe these “implications” are in earnest, certainly there is no indication that the author is a collectivist or an altruist by any stretch. The arguments, more likely, have been made to be more palatable to the wide “spectrum” of readers which must be persuaded… it is unfortunate that so fundamental a thing as individual rights need to be defended by appealing to those who are blind to them. Unfortunate that the justification of living in a just, moral, and free society, one which protects individual rights, must be based on an overall economic metric of public prosperity, public goods or goodies. Unfortunate that citizens of (once?) the freest country in the world must be persuaded by some purported good equivalent to an economic “weather” in which they are blown, powerless, rather than persuaded by the fac tthat the protection of the rights and freedoms of the individual IS the greatest Public Good and that the protection of those rights and freedoms IS the proper end of Government.

    The sarcasm is warranted only to shed light on the paradox inherent in the act of persuading the pernicious, but it should not be directed at the author’s character, only at the preposterous situation he unfortunately finds himself in.

  4. American Cowboy November 16, 2017 10:34 am

    Anon2, I was not intending to demean our esteemed author and bloghost, bro Quinn. Sorry if I came across that way.

    My point was to show how if the basis for the “inventions should be free” thesis is correct, it leads to lots of stuff that even Bernie Sanders might think is a little extreme.

  5. Lost In Norway November 16, 2017 3:39 pm

    One of the difficulties I have in being a practitioner in where I live (Norway) is smacking the inventor about the head and shoulders until they agree to let me try and get them broader protection that they can license to another company. I don’t know how many times I have heard, “I don’t need to do that, my industry branch will be enough money for me”. That makes the American in me die a little each time. So now I try to sell it with, “Well, you can pay more taxes, donate the extra money, fund your next invention. Just let me help you make money!”. But patent rights are definitely getting stronger here. Now if those in the business here can just educate the natives.

    I breaks my heart to watch what is happening to patents in the United States. People may not like it, but if we want someone to invent and innovate, make sure that they can feed themselves and their family by doing it. Let inventors invent.

  6. Dan Hanson November 16, 2017 7:20 pm

    Fifty years ago (3 November 1967), the following exchange was broadcast.

    Kirk: Did you pay royalties to the owners of those patents?
    Mudd: Well– actually, Kirk, as a defender of the free-enterprise system, I found myself in a– in a rather ambiguous conflict as a matter of principle.
    Spock: He did not pay royalties.
    Mudd: Knowledge, sir, should be free to all!!

    In those days, the one championing the free-enterprise system and urging that knowledge ought to be free for all was Harry Mudd, and he was without any doubt a scoundrel.

    (Star Trek [original series] “I Mudd” by Stephen Kandel and David Gerrold)

  7. David Lewis November 17, 2017 2:01 am

    Agreed! It is unfortunate that those advocating a weak patent system get bipartisan support by complaining about “trolls.”

  8. step back November 17, 2017 1:00 pm

    From each (inventor) according to all of his/her abilities.
    To each (inventor) according to his/her needs, wherein said needs equal zero or less.

  9. angry dude November 17, 2017 1:53 pm

    step back @8

    That mantra from Karl Marx never worked even in the Soviet Union where they
    changed it to “…according to his/her contribution”

    It only worked in Stalin’s Gulag – so called “sharashkas” where imprisoned engineers and scientists worked on inventing new tech and their “needs” were strictly limited to daily food ration (with meat and sugar) and warm bed to sleep at night (as opposed to cold barracks and no meat at all)
    “The first circle” (of hell) by Solzhenitsyn

  10. Anon November 17, 2017 2:30 pm

    I think that (at least for the choir here) it is far less “Hakuna Matada,” and far more “the several different and powerful engines out there engaged in spin are difficult to change the narrative being sold.”

    I really do not think that some type of laissez-faire abounds for those concerned.

  11. step back November 17, 2017 2:32 pm

    angry @ #9

    Yes.
    That is understood.
    I inserted my #8 comment with intent of tongue being stuck out through cheek.

    Of course inventors/scientists will not give it there “all” for sake of subsistence level survival. In such scenarios, people give no more than the bare minimum of effort. It is a Marxist dream to believe that people will invent and innovate for the mere sake of having done so. Our Founding Fathers did not have to ponder deeply over that concept. It was a self evident one which they enshrined in the US Constitution as Article 1, section 8, clause 8 so as to promote the progress of science and the useful arts and thus promote the general welfare and secure for ourselves and our posterity a more perfect union.

    Of course, today we live a new and improved America where all that is invented is abstract and ineligible and thwarts rather than promotes innovation. The Supremes have overruled the Founding Fathers. Long live the Inquisition.

  12. Alex November 17, 2017 11:58 pm

    Why don’t you just come out and say you’re for a registration system?

  13. Benny November 19, 2017 2:29 am

    First off, you can also find a strong correlation between the weakness of country’s economy and the measure of theocracy in its’ government.
    But to the point, if I take my country as an example, the vast majority of innovation carried out here – and there is a lot of it – is protected by patents outside of the country’s jurisdiction. A strong patent system in the US encourages foreign competition more than it encourages local innovation.

  14. Anon November 19, 2017 10:01 am

    A strong patent system in the US encourages foreign competition more than it encourages local innovation.

    I have never seen this proposition advanced before.

    I doubt its veracity.

  15. Benny November 19, 2017 10:19 am

    Anon,
    Why would you doubt it? I can export my products to the USA with the comfort of having ITC and patent protection to prevent you from offering locally made, or imported, copies. I see more profit in a market where I can keep the competition at arm’s length. I do agree with Gene that effective IP protection encourages industry investment, but you should not take that to mean the investment is necessarily on US soil. To extend my example further, most of my competitors are not US based, but they all own US patents.
    If the IP battleground between foreign players is in US courts, the beneficiaries are US attorneys, not US innovators.

  16. Anon November 19, 2017 11:47 am

    Why would I doubt it?

    Because it is nonsensical, that is why.

    ALL patent law is sovereign centric. It does not (nor can it) concern itself with “competition abroad,” and anywhere where patent protection is not applied for, open copying will be the norm ( and open copying is NOT new and thus NOT the type of “threatening innovation” that we are talking about).

    I see more profit in a market where I can keep the competition at arm’s length

    Absolutely – but this goes in the opposite direction of your attempted new view here.

    I do agree with Gene that effective IP protection encourages industry investment, but you should not take that to mean the investment is necessarily on US soil.

    Again – you need to recognize the sovereign centric aspect of patents. So while you are absolutely correct in that there is no “must” of any investment being on US soil to gain the benefit of US patent protection, such has not been a part of the equation as to why a strong patent system begets more innovation (as opposed to a weak patent system that begets more of the “guild” mentality and focus of competition on the less innovation factors that Big Corp more readily controls).

    If the IP battleground between foreign players is in US courts, the beneficiaries are US attorneys, not US innovators.

    A strawman and a red herring. This comment has nothing at all to do with whether or not a strong US patent system promotes innovation (or your odd view that a strong patent system encourages foreign competition more than encouraging local innovation.

    Items that you should pay more attention to:

    – A strong patent system provides a better “leveling effect” between Big Corp and those small start ups that thrive more readily on disruptive innovation.

    – A strong patent system – promoting more of this disruptive innovation – WILL BE more naturally local-centric, because small start-ups are more likely to patent locally, and aim their business goals locally.

    This is NOT to say that there is any form of “must” involved, and this is not to say that foreign innovators wanting to develop a US presence will stay away from a strong US system. But each of those are non sequiturs. The flip side (that you want to advance) simply has no backing in fact or theory. You seem to aim your view that since some foreign based innovation occurs, that the primary innovation is foreign based.

    It just is not so. And especially not so for start-ups.

  17. Gene Quinn November 19, 2017 4:35 pm

    Alex-

    You must be new here. I have said very explicitly that the U.S. absolutely must move to a registration system if the PTAB is going to exist. It is unconscionable for inventors to be required to spend many tens of thousands of dollars, sometimes into the hundreds of thousands of dollars, to acquire a patent only to have valuable, widely infringed patents that are supposed to be presumed valid to require the patent owner to spend $500,000 to $1,000,000 to keep the patent in a post grant proceeding.

    So — yes — if the PTAB and post grant challenges are here to stay then the only way a U.S. patent is worth pursuing is if the system is changed to a registration system.

    Hopefully that clears up you faux confusion.

  18. Anon November 19, 2017 5:35 pm

    Gene,

    I too in the past have put forth the notion that a registration system appears to be the “better path” than the one we are going down if the act of granting a patent carries with it no legal advantage as far as a clear and secured title of property.

    That being said, there are further ramifications with the Oil States case depending on how that case is decided.

    If patents are deemed to be some type of “public right” and NOT property, there are many other patent principles based on patents as property that will suffer necessary ripple effects.

    (For example: patent exhaustion – and not only exhaustion of chattels that may fall under the hard goods categories, but patent exhaustion for processes)

    The notion of “public rights” is far deeper and far more nefarious than a first glance would reveal.

    Of course, IPRs are infirm for several reasons, so we will have to wait and see just what the Oil States decision and holding provide.

  19. angry dude November 19, 2017 8:21 pm

    If foreign entities like Benny can benefit from current US patent system and American inventors can’t then the answer is quite obvious – screw patent system,
    replace it with registration system or nothing at all
    enough is enough

  20. Benny November 20, 2017 2:34 am

    Gene at 17,
    A quick review of the Chinese, German and Australian “registration models” (utility models, innovation patents) shows that they are not immune to invalidation. I may be wrong in assuming that these are relevant examples of the patent systems you would like to see in the US.
    Angry – the inventors nationality has no bearing on whether or not they can benefit from a patent system, be it a standard or registration type. I’ve been helixed by incompetent examiners too.

  21. Anon November 21, 2017 8:23 am

    I may be wrong in assuming that these are relevant examples of the patent systems you would like to see in the US.

    I believe that you are.

    The context here has more to do with why are we having innovators pay into a multi-Billion dollar support system when the “value” obtained is on par with a registration system that would be able to be funded for fractions of pennies on the dollar.

    This is LESS about a pure choice, and more a statement against how the sanctity of title of a granted patent has been SO besmirched so as to place other unenviable options nearly (or not so nearly) on equal footing as to the value of the end product.

    I am not certain how much those foreign registration models costs, nor am I sure of the relative nature of those costs to the costs of “full” patent procurement, but the focus here is not a trans-national analysis, but a degradation of our sovereign system.

    If you “follow the dollar” and see who benefits most from this degradation, you will see that it is the large transnationals that would rather compete on non-innovation factors. That alone should give you pause.

  22. PTO-Indentured November 21, 2017 9:17 am

    Suggested additions to American Cowboy comment @1 — from an individual American inventor POV:

    * Insert before each line below — “Only one out of six (since AIA/2012) still-surviving individual”

    ** Insert after each line below — “and any legal actions they’re forced into by 2012-law (designed to favor challengers) make them individually responsible for all of the attorneys’ fees.”

    * Doctors should care for patients without charging for their services, **
    * Teachers should teach children without expectation of a salary, **
    * Farmers should grow their crops and give them away at markets, **
    * Software developers should write their code and make it publicly available for copying without charging a royalty. (Oh, and works of authors, screenwriters, actors and musicians too), **

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