Why it is unnecessary to open the patent system

By Gene Quinn
July 1, 2015

reality-check copyI’ve read a lot of disingenuous articles about the U.S. patent system and how patents are bad, indeed practically evil. But rarely have I read something quite as misleading as the recent article authored by Colleen Chien published in the Washington Post. The premise of the article is that it is time to open the patent system. Specifically what that means, and to what end that would be useful, is unclear and frankly unexplained.

For those who are not knowledgeable about patent laws and the U.S. patent system Chien’s suggestion probably sounds like a good idea. After all, Chien argues that it is impossible for someone to donate their technology without fearing that another will get a patent on it and defeat the well-meaning donation to the public. Such a statement plays into urban mythology and preys upon those who are convinced that patent applicants can and do steal innovations and get patents instead of the rightful inventor. If that were actually true I’d be all in favor of opening up the patent system, whatever that means. Unfortunately, Chien builds her argument on a factually erroneous foundation.

The problem I have with Chien’s argument starts with her premise, which is entirely incorrect. There is nothing stopping anyone from donating innovations to the public. Further, Chien has it precisely backwards. If an innovation is disclosed to the public it is impossible for anyone else to patent it, period. Chien has to know this.

Let’s back up for a minute and start with Chien’s premise, which is summarized in the article as follows:

If an inventor wants to open her technology for others to innovate without worrying about permissions, there is no way to guarantee that the Patent Office will not issue a patent over the technology to a later applicant, an issue that goes to patent quality.

(emphasis added).

Chien’s statement seems flat out false, and I’m sure many on the pro-patent side of the aisle will believe her statements to be intentionally false and intentionally misleading. As puzzling, and incorrect, as this statement is I am reluctant to jump to malice as the explanation. Long ago as a new attorney I was taught by my primary mentor that you should never allege malice when incompetence is a perfectly possible alternative explanation. He would tell me repeatedly that most people are not malicious, but a lot of people are incompetent. Despite my wanting to give Chien the benefit of the doubt, I admit that it is difficult to imagine characterizing Colleen Chien as incompetent. Notwithstanding, what I can say beyond any shadow of a doubt is that this article and the above premise is horribly misleading.

Anyone with even a passing understanding of patent law has to know that it is completely incorrect to claim that the Patent Office will issue a patent to a later applicant when the innovator has made the innovation publicly available. Such a bogus and provably false assertion to the contrary raises legitimate questions. Obviously, Chien is someone who is well acquainted with patent laws and the U.S. patent system, so why would she make an assertion that seems to ridiculously false on its face? What is her agenda?

For those who are not well versed in the nuances of patent law and the U.S. patent system, allow me to explain why Chien is wrong, in fact dead wrong.

For many generations, in fact since the Patent Act of 1793, there has been a requirement of newness (or novelty as it is called in the industry) in order to obtain a patent. In other words, for well over 200 years it has not been possible to obtain a patent on an invention that already exists. So how Chien thinks the Patent Office can issue a patent once someone has opened up their technology to the public is unclear and unexplained. Is she really unfamiliar with the concept of novelty, which has existed in patent law for at least the last 222 years? Doubtful. Nevertheless, the way the premise is worded is certain to cause the reader to believe things that simply are not true.

To be fair, over the last 222 years the idea of what constitutes the required newness has changed. Perhaps the most drastic change over that span occurred in March 2013 when the United States abandoned the first to invent rule and adopted a first to file rule. As a result of the passage of the America Invents Act (AIA) the patent laws in the United States changed dramatically. While the Act became law on September 16, 2011, the first to file provisions did not become effective until March 16, 2013.

Effective March 16, 2013, filing a patent before there has been any public disclosure of the invention is of paramount importance. It is true that there is an extraordinarily narrow grace period of 12 months that still remains, but applicants for a patent are entitled to the benefit of that grace period only in extremely limited circumstances. For example, an applicant can claim entitlement to a grace period if they disclosed their invention first and before they filed their own patent application there was an intervening disclosure that describes the first inventors invention. In certain of these circumstances the first inventor who disclosed would still be entitled to a patent despite not having filed prior to their own disclose. In order to prevail and remove the intervening disclosure from the universe of prior art the first inventor has to demonstrate that the intervening disclosure was derived from the inventor and actually describes their invention. If there are any difference between the intervening disclosure and the disclosure by the first inventor at least those differences will be used against the first inventor. Thus, the grace period is now extraordinarily limited.

Significantly, there is no provision that would allow the intervening party to file for a patent application and remove the prior disclosure of the first inventor. Someone who files a patent application after there has been a disclosure of the invention will have their application denied because it lacks novelty. See 35 U.S.C. 102. Thus, the claims of Colleen Chien, Elon Musk and others who say that patents are sought because that is the only way to prevent others from obtaining a patent are false. If you invent something and you want to prevent someone else from patenting the invention all you have to do is publicly disclose the invention, such as by publishing a description of the invention. It really is that simple.

Simply stated, there is no way that the Patent Office should issue a patent covering the previously disclosed innovation. If the Patent Office does issue such a patent it is a mistake. To correct these mistakes in a more timely, efficient and cost effective manner the America Invents Act created new procedural mechanisms that do not require a lawsuit in federal district court. These new procedures were universally sought and praised by high-tech companies and others as a way to efficiently correct mistakes. So unless Chien is building an argument based on the inevitable reality that no one is perfect,  including the Patent Office, her conclusion is erroneous. Perfection is never possible, which should be self evident.  Assuming the law is followed, today it is impossible to obtain a patent on an innovation that someone else has previously disclosed.

The only other possible justification for what Chien claims is that she sees a problem because it is possible to improve upon an innovation and obtain a patent on the useful, new and non-obvious improvement. Having a problem with the patentability of improvements would be curious though. Improvement patents have been a part of the U.S. patent system since its beginning, again at least since 1793 when none other than Thomas Jefferson wrote the Statute saying a patent can be obtained on “any new and useful improvement…” So if Chien is taking aim at improvement patents she is taking aim at the wisdom of Thomas Jefferson, which should cause any reasonable person to think twice.

If Chien has an issue with the patentability of improvements she is also takes aim at none other than Thomas Edison, who is widely regarded as the greatest inventor in U.S. history. It is well known that many of Edison’s greatest inventions were improvements upon previously existing innovations. In fact, Edison’s greatest invention, the invention of the light bulb, was actually an improvement of previously existing light bulbs. Edison improved upon the technology by developing a light bulb that used a lower current electricity, a small carbonized filament, and an improved vacuum inside the globe. Edison’s improved light bulb lead to a reliable, long-lasting source of light. Prior to Edison’s invention light bulbs lasted only a few hours and now they could last 50 to 60 days, making them practical. So Edison invented the first commercially useful light bulb. An improvement, and one that certainly ought to be patented.

The entire reason for a patent system is to encourage innovation. The fact that improvements can be patented is precisely one of the features that cause innovation to march forward; it is a feature of the patent system by design. Is Chien really suggesting that no improvement patents should ever issue after someone dedicates a first, early innovation to the public? Such a bizarre suggestion is not only naive, it is utterly ridiculous. A first innovator does not and cannot have an absolute right to prevent the patenting of improvements they didn’t invent and couldn’t have conceived. Such a rule would turn patent law on its head and require a fundamental re-write of the patent laws, abandoning 225 years of history.

So what is Chien’s agenda? Is she trying to argue that improvements should be patented without directly asserting that as her goal? Is she arguing that the fact that the Patent Office isn’t perfect means that no patents should be granted if someone donates technology to the public? Is she simply making an over broad and provably false statement for some other purpose? I don’t know, but what I do know is that this article will cause readers to come to conclusions that are simply incorrect. Therefore, whatever the agenda or reason, Chien’s article is misleading and could cause unnecessary damage to the patent system if it is relied upon by decision makers.

The Author

Gene Quinn

Gene Quinn is a Patent Attorney and Editor and President & CEO ofIPWatchdog, Inc.. Gene founded IPWatchdog.com in 1999. Gene is also a principal lecturer in the PLI Patent Bar Review Course and Of Counsel to the law firm of Berenato & White, LLC. 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 59 Comments comments.

  1. EG July 1, 2015 3:05 pm

    Hey,

    More evidence that academics like Chien shouldn’t be teaching IP law. That my former “yellow rag” would publish such nonsense also proves that the media is incapable of unbiased views on patent law either.

  2. Curious July 1, 2015 4:59 pm

    Wow … I went to the article (before reading Gene’s post) and read Chien’s article first. I then read the comments section before seeing her tagline. I was thinking to myself — [yeah, just another no-nothing journalist] then I read that Chien is a former “White House senior advisor, intellectual property and innovation, at the Office of Science and Technology Policy” and teaches patent law at Santa Clara. I was floored — I could believe Chien knows so little about the patent system?

    Chien writes:
    The patent system should pay more attention to supporting the rights of patentees to enable rather than to forbid, others from practicing patentable inventions

    Perhaps Chien should become more familiar with this statement:
    To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.
    Notice that statement about “exclusive Right”? This is what is written within the US Constitution — this is the mandate for the US patent system — protecting the rights of inventors to exclusivity.

    As identified by others already, there are plenty of mechanisms by which patent rights can be disseminated (or not obtained in the first place). Only a legal academic would make a mountain of a molehill. Then again, I guess we should all be thankful that Chien is no longer a “senior advisor” at the White House.

    When I think about how the patent system has been dismantled these past few years, it doesn’t take a lot of imagination to identify the (many) enablers of that dismantling.

    I wonder if any of them realize that they are just tools of certain large corporations that want to infringe patents with impunity. This isn’t some philosophical debate over the sharing of technology (sounds a lot like communism to me), this is simply a fight over money. Unfortunately, the patent infringers have had the upper hand over inventors for quite some time as it has become far, far more easy to infringe somebody’s patents today than it has been for a very long time.

  3. Penny July 1, 2015 5:02 pm

    Good point! The patent system is open in the way that every body can access to the patent database so knowledge can be share. If you want to use it, get a license from a owner. But people like Chien are trying to make it open in the way that everything is free. But at the end, everybody knows nothing comes free…

  4. JNG July 1, 2015 5:11 pm

    Ms. Chien must have forgotten that the valiant efforts by her and big corporate infringers to impose the AIA on the rest of us resulted in the elimination of SIRs, which were a cheap way to pay for information to be published and donated to the public. IBM used them all the time. But if someone is so keen on sharing their bright ideas they need only file and then ABANDON the application after it is published. As you noted, even in a FTF system, this will be enough to prevent some later person from “patenting” that same idea. IMO Ms. Chien and her other well funded/sponsored academics are notoriously fond of telling only half the story and hiding the ball in self-serving ways to try and make patents seem… bad.

  5. Gary July 1, 2015 7:04 pm

    How about a provision that “opens” the patent system to inventors negotiating with big companies without worrying about being put into IPR or defending a declaratory judgment lawsuit? If I have a patent that I think a company may be interested in, companies won’t even take my call because they fear it will be used to prove intentional infringement. On the flip side, I won’t even make that phone call because I don’t have the money to defend against a megacorporation’s attack on my patent’s validity. Is it any surprise that inventors are willing to sell patents at a very steep discount to non-practicing entities?

    Creating a “negotiation safe harbor” for both the inventor and the alleged infringer would be a huge step forward. We already do something a lot like this for many categories of civil lawsuits (for example, California Evidence Code 1152). Non-practicing entities have become, in a really weird way, the intermediaries between inventors and big companies who each have incentives not to speak to the other.

  6. Brian Smith July 1, 2015 8:19 pm

    Colleen Chien was paid by Google to write this article.!!!

    How do I know this, Both Michelle Lee (USPTO Head, and Ex Google ) and Colleen Chien have work very closely for last 7 years.

    Colleen Chien Need to come forward and disclose How much money she got from Google to write an article like this. Her Financial records must be examined.

    Michelle Lee and Colleen Chien are being used by Google to undermine and destroy our 250 year old Patent System.

    There is a coordinated PR campaign by Google to destroy our patent system. Every week there is an PR funded article to undermine our US patent system.

    Wake up guys, this is worse than a Trojan horse.

    If you dont believe me google Colleen Chien Michelle Lee yourself.

    http://patentlyo.com/patent/2013/12/director-michelle-lee-a-rough-start.html

    “Secret Exclusionary Meeting: Within hours of her announcement as Deputy Director, Director Lee and White House Patent Reform Coordinator Colleen Chien spearheaded a roundtable discussion with a select group of invited guests”

    You will find as lot of article on how both have worked together and BOTH of them DO NOT believe in our incentive based US PATENT System.

    Can someone do something about this dangerous alliance?

  7. Curious July 2, 2015 12:41 am

    Brian:

    Very interesting. I remember that article from Patently-O. This is what I’ve found on “Business Forward” — the “business group” that met with Lee and Chien.

    http://www.publicintegrity.org/2014/01/16/14107/top-us-corporations-funneled-173-million-political-nonprofits#nonprofit/business-forward

    surprise, surprise … Google is listed as one of the contributors.

    http://www.businessfwd.org/blog/two-business-forward-member-companies-lead-best-practices-initiative-to-reduce-ip-infringement
    Here they unabashedly list Google as a member. Never mind Michelle Lee’s well-documented relationship with Google, it isn’t too hard connections between Chien’s current/former employers (Santa Clara Law School and Fenwick & West) and Google. I was also able to find a number of connections between Chien and Suzanne Michel (Senior Patent Counsel at Google regarding patent strategy).

    Michel’s writings can be found here:
    http://googlepublicpolicy.blogspot.com/2013/02/lets-defend-innovators-against-patent.html
    Note that she repeats the (debunked) $29 billion number.

    Why doesn’t Google just come out and state that they want to dismantle the patent system? Why do they let their proxies fight these battles for them?

  8. Anon July 2, 2015 5:30 am

    Gene, unfortunately there ARE ways of patenting what has already been disclosed, especially in the chemical field. One can take refuge behind some odd parameter (and if none exists, one can invent one). The Patent Office has often never seen such a thing before and grants a patent – and in the USA revocation of a granted patent is a terrifyingly expensive business, especially for the little guy. One very large US company in particular has turned this form of patenting into an art form, relying on its size and reach to deter possible objections, a clear-cut case of God being on the side of the big battalions. We are distressingly seeing others emulate this blatantly dishonest form of land-grab.

  9. Benny July 2, 2015 5:57 am

    Gene,
    When Chien writes “there is no way to guarantee that the USPTO will not issue a patent” she is sadly correct. How many office actions have you seen in which the examiner cited anything other than patents or patent applications as prior art? In our field, the USPTO recently granted a patent for a device which was described (in far greater detail than the application) in an earlier research journal. Of course, the patent wouldn’t stand up to an IPR, but how much would that cost us? Validity is presumed, I understand.

  10. Anon July 2, 2015 7:34 am

    There is a not-so-subtle war against the patent system; and combatants in that war are identifiable by their words and actions – no matter where in the system their professions may be.

    You are either for or you are against patents – the situation really does galvanize to a black and white issue. I say this knowing that there still is a thin grey to that dividing line, but that grey zone is far more narrow than most people realize.

    When arguments and positions are considered carefully, when critical thinking is applied, when subjectivity is replaced with objectivity, the positions of those that do not want patents in particular areas are seen to reflect the positions of those that do not want patents at all. The “gist” of the positions as it were, are aligned.

    Professor Chien has long and clearly been over the line and in the anti-patent camp.

  11. Benny July 2, 2015 8:43 am

    Anon,
    “You are either with us or against us…” where have I heard that before?
    I don’t accept the white hat/black hat stance. Patents come in many flavours – some are commercially irrelevant, some are minor improvements on existing technology, some are truly innovative, some claim rights to which they are not entitled, some create a return on investment, and some, like US7971831, cannot even be infringed on planet Earth.
    Perhaps some of us want to see more wheat and less chaff, and maybe we sometimes expect a more thorough approach to the examination process.

  12. aldo July 2, 2015 9:32 am

    with all due respect, current patent systems seem broken & favor large entities + those that are paid to run the systems.

    ms. chien is suggesting throwing out the baby with the bathwater… & without (intellectual) property rights, the large take from the small… opening up patent systems effectively makes it legal.

    what is needed are intellectual property systems that work for all constituents. and provide predictability & fairness in the marketplace.

    one of the biggest hurtles is our ability to change without a crisis or more pain…

    the good news is that we created the problem and thus we can solve it… with better ideas!

  13. EG July 2, 2015 10:31 am

    Benny,

    Like you, I want more “wheat” and less “chaff” in granted patents. But to keep the US patent system from imploding and coming to a halt, we also need to endure some undue “chaff” in order to get more of that important “wheat.”

    My problem is that the current debate about the US patent system is being driven by PR, agendas, and frankly factually flawed studies, many coming from so-called IP law academics like Chien (I also include in that category Feldman and Lemley) which are virulently anti-patent, and which will likely drive most innovation by individuals/small businesses completely out or underground, i.e., will be kept as trade secrets.

    As others have also suggested, several of these IP law academics have also failed to disclose their “hidden” associations with organizations and especially businesses, such as Goggle, who would just as soon completely “burn down” our IP system. I also freely confess that I’m a second-generation patent attorney (having completed my 38th year), but I’m also not a “starry-eyed” pro-patent advocate. While I’m certainly pro-patent system, I’m also believe any patent granted should clearly define in the claims (which the Royal Nine are often blip over with their nonsensical, technologically-ignorant and illogical statements, including failing to define key legal phrases, such as what is meant by “abstract idea”) what the forbidden territory is, and that those claims should only cover that which is “described” and “enabled.” I also believe that judgments on patentability, as well as patent-eligibility, should be factually based (something the Royal Nine seems utterly incapable of doing) and not driven by biased policy, flawed factual studies, and the like proffered by Chien and her ilk (including Bessen and Meurer) that are accepted without critical thought or examination by the Royal Nine, Congress, and most significantly, a clueless, as well as biased media

  14. Curious July 2, 2015 1:23 pm

    When Chien writes “there is no way to guarantee that the USPTO will not issue a patent” she is sadly correct.
    That can be said about any patent system in any country at any time. This goes to the incompetence of the patent office — not a failure of the system. Moreover, there is nothing that Chien proposes that would “guarantee” that the USPTO still will not issue a patent on whatever subject matter being dedicated to the public.

  15. Curious July 2, 2015 1:27 pm

    Perhaps some of us want to see more wheat and less chaff, and maybe we sometimes expect a more thorough approach to the examination process.
    If you have a way to separate the wheat from the chaff, then let’s hear it. While you are at it, explain how your proposal to separate the wheat from the chaff will decrease costs to society.

  16. Ron Hilton July 2, 2015 1:53 pm

    The dilemma is how to increase patent quality without increasing overall cost. The answer is to have a dual tier system. A top tier patent would require a thorough crowd-sourced search (cost approx $25K). A bottom tier patent would lack the right to sue for infringement, but could be upgraded to a top tier thorough an accelerated reexamination at any time if it needed to be enforced. Since the vast majority of patents never need to be enforced, the overall cost increase would be negligible, and only high-quality patents would ever be litigated. Until the patent profession accepts this kind of solution, we will be in jeopardy of ill-advised “patent reform” using anecdotal patent quality problems as the justification.

  17. Gene Quinn July 2, 2015 2:01 pm

    Benny-

    You write: “maybe we sometimes expect a more thorough approach to the examination process.”

    That would absolutely destroy the patent system. Right now the patent process is long, costly and a crap-shoot that is almost exclusively determined based on whether your application is in an Art Unit and in front of an examiner that views their job as issuing or views their job as denying. Even if you get a patent, if it turns out to be fundamentally important and ubiquitous (i.e., copied because it is so important) you will be vilified, your patent will endure multiple, serial challenges, and ultimately the patent claims will finally be lost.

    Simply stated, you cannot have a costly, lengthy process to obtain a patent when commercially valuable patents will almost certainly be killed.

    If we want so desperately to be able to kill patents after the fact with such ease, whether at the PTAB or in the federal courts, we MUST have a registration system that looks far more like the copyright system. If we continue down the path we are on it will be impossible for businesses to justify spending $50,000 or more to get a patent only for the right to spend millions of dollars and ultimately lose all valuable claims.

    -Gene

  18. Gene Quinn July 2, 2015 2:07 pm

    Benny-

    You say that Chien is sadly correct about the USPTO not being able to guarantee perfection. You say that like it is somehow news, or thoughtful. You do realize that perfection is an impossibility, correct? Even if the USPTO were 99.5% accurate that would mean 3,000 patents being issued annually that are mistakes. Does anyone really believe any entity the size of the USPTO can realistically achieve 99.5% accuracy? Please.

    You also seem to want to do whatever it takes to guarantee no bad patents issue. That is extremely ridiculous. Less than 2% of patents will ever be useful in any real business context. So why should we do a no-stone unturned search given that inescapable reality? We know what it will cause because we saw the backlog explode during the second pair of eyes era at the USPTO.

    I’m find with ending the presumption of validity. It doesn’t seem to matter anyway given how recklessly the PTAB and Courts invalidate patent claims. Clearly patents are no longer presumed valid. But if we are going to do away with the presumption of validity there is no reason to have an examination process. We need a copyright registration process where patents are given to everyone for the asking and they get what they request.

    -Gene

  19. Ron Hilton July 2, 2015 2:10 pm

    Gene,

    If the current system is already too costly, then your proposed registration system could be the lowest tier, with the current system being the middle tier, and crowd-sourced search being required for the top tier. Only the top tier would have the right to sue, but the lower tiers would have the ability to upgrade to the top tier through an accelerated reexam.

  20. Anon July 2, 2015 2:34 pm

    Ron,

    Let’s NOT have yet another go at the Merry Go Round of your two tier system – unless of course you have addressed the rather serious shortcomings pointed out in our previous conversations.

    Thanks.

  21. aldo July 2, 2015 2:55 pm

    i believe jefferson changed the patent system to registry much like copyright/trademark before he died, then congress changed it back.

    as an inventor and the first agent, he understood the nuances and what could work better.

    a patent registry system could allow for better allocation of pto resources while making patents more affordable. once an issue arises between two or more parties over a registered patent, the pto could focus efforts to provide detailed and quick analysis for resolution between the parties….

    we have endless solutions to this man made problem…

  22. Ron Hilton July 2, 2015 4:14 pm

    Anon,

    Although I don’t agree with your past objections, it is true that change always has a degree of risk. However, sticking one’s head in the sand, denying that a quality problem exists and that it threatens public support for the entire system, is not an option, in my humble opinion. If you have a better solution, let’s hear it. You are as reliable as clockwork with your obligatory “see my prior objections” comment whenever I raise certain ideas, but you never have any solutions of your own to offer.

  23. Curious July 2, 2015 5:49 pm

    a patent registry system could allow for better allocation of pto resources while making patents more affordable
    A patent registry system would be little more than a way for the USPTO to collect fees for doing nothing. Ultimately, if you want something valuable, then you’ll need to step up to a 2nd tier (i.e., what we have today).

    A patent registry will be a boon to the patent registration firms that we see advertised on late-night TV and nobody else.

  24. Ron Hilton July 2, 2015 5:59 pm

    A patent registry could be somewhat analogous to a provisional that doesn’t expire – basically a way to obtain and hold a priority date. Not a bad first step for an inventor on a low budget who needs more time for market research and fund raising, as long it can be upgraded to a higher-tier patent if and when the inventor is ready to take the next step.

  25. aldo July 2, 2015 7:00 pm

    thanks ron – i like that idea; a much longer term provisional that could be easily & quickly further processed once marketplace success can be demonstrated &/or a marketplace dispute arose…. i believe this type of program could enable the pto to better allocate resources – not all patents need to be reviewed, but allowing the marketplace to determine which ones are important seems to make sense…

  26. aldo July 2, 2015 7:52 pm

    gene’s comment is consistent with my experience – the examiner’s mood and views determine too much of your outcome while the market then shreds what is left… why try to begin with?

  27. Anon July 2, 2015 10:10 pm

    Ron,

    With all due respect, if you are going to insist on being lazy and take the short cut of presenting your same old ideas with their same old flaws, I am going to be equally lazy and merely point out that your same old ideas still have those same old flaws.

    Your same old bad solution is very much still the same old bad solution. Let’s not pretend your old idea got better by your continuing to not address the deficiencies pointed out to you.

  28. Ron Hilton July 3, 2015 2:34 am

    Anon,

    Actually the multi-tier idea has been steadily evolving, if you compare my posts on the subject over time. The original concept was Kristen Osenga’s multi-track proposal. Then the Peer-to-Patent and Article One Partners crowd-sourced search provided another key element. Gene Quinn’s insight regarding a “right to sue” further informed the idea. And in the comments just preceding this one, the discussion of a patent registration system suggested the idea of simply extending the provisional concept as a basis for the lower tier.

    The bottom line is that I personally take very little credit for the idea. Furthermore, I always try to listen to the constructive feedback that others provide and modify my thinking accordingly. If you think you had some constructive feedback that I failed to grasp, then please try explaining it again in some way that may make it clearer. Frankly I no longer remember the details – I get you confused with Blind Dogma (the Kool-Aid person) who also used to routinely put people down with little or no elaboration as to the reasons why.

  29. Anon July 3, 2015 6:41 am

    You are confused and you want me to explain again…? My explanations have been clear – you have not ever explained where they are not clear, but instead, you have merely stated that you disagree. You confuse your own disagreement with an explanation as to why my views were in fact “unclear.”

    Our discussion was in fact rather detailed. I explained that your tiers were worthless because the lower tiers (which gave a “right” that could not be enforced was no right at all) and the highest tier (effectively what we have now, just gold-plated) did not resolve anything in a meaningful manner. Your solution still varies not at all even though you wish to now cloak it in a mantle of evolution.

    You have a patent right or you do not. That right has a cost – sum total. All I see from you is smoke and mirrors, and to take you to task, you TOO have not fixed the underlying problem of examination whatsoever. You want to claim that I have not fixed the examination problem when you have not done so either. All that you have done is add layers of non-rights, delays, uncertainty, gold-plating, and in the end, nothing at all about the final enforceable patent. And then you want to be patted on the back for this non-advance nonsense.

    I will also remind you that Gene’s trade-off of presumption of validity for a registration system is something that I have advanced previously. The difference between what Gene and I put forth in our similar idea is in fact different from yours in the critical aspect that the registered patent is enforceable at a court of law without more.

  30. IP Bulldog July 3, 2015 12:04 pm

    “[T]he [argument] (sic) of Colleen Chien, Elon Musk and others who say that patents are sought because that is the only way to prevent others from obtaining a patent are false.”

    The argument is not false if examiners are merely searching the PTO patent database for prior art.

  31. Ron Hilton July 3, 2015 1:39 pm

    Anon,

    OK, I will explain again why I disagree with your critique. You are making a fundamental assumption that the patent right has to be all or nothing. That is no more true of IP than it is of real property or any other kind of property. There are parts and degrees to the patent right, including presumption of validity, as you have acknowledged, as well as priority, right to sue, and in terms of litigation, there is the evidentiary standard, the right or lack thereof to an injunction, and so forth. The public also has rights, including disclosure of the invention, and the right to post-grant challenges and litigation. It makes perfect sense to phase in these rights in proportion to the thoroughness and rigor of the prior art search, examination, appeal, reexamination, post-grant challenge, litigation, and so forth. A simple registration with no search or examination would give the right of priority, and nothing else. A basic search and examination could give the presumption of validity, but with a low evidentiary standard to overturn it, and no right to sue. A very thorough search and examination, including subject-matter expert review of the non-patent literature, crowd-sourced search, etc., could then warrant additional rights, such as immunity from post-grant challenges, the right to sue for infringement, and a higher evidentiary standard to overturn its validity in court. To me, this is all completely logical and reasonable. I truly do not understand your vehement and repeatitive criticism of the idea.

  32. Anon July 3, 2015 6:59 pm

    It is not an assumption that it has to be all or nothing:

    It is a defintion of what is or is not enforceable.

    There is a stark and real world difference. It is you that assumes otherwise.

  33. Ron Hilton July 3, 2015 7:54 pm

    Anon,

    Enforceability is very much a matter of degree, not an absolute. In the real world of business and economics, enforcing a patent means actually obtaining a royalty payment or deterring infringement by a competitor. I personally received a lump-sum royalty on a provisional application, so in that very practical sense it was “enforceable” even before the patent issued. All that a multi-tier system does in that regard is to formalize some of the steps/hurdles that already exist in achieving actual enforceability in a logical, cost-effective way. The lower cost steps are taken first, with the potential of avoiding the higher cost steps, up to and including the final and mostly costly step of litigation.

  34. Anon July 3, 2015 9:55 pm

    Your statements have no relation to reality** – you are quite literally making things up now.

    Also – the other point that you are conveniently forgetting about: you’ve done nothing to fix the real problem of examination itself. All you have is shell games.
    **quite apart from the exception that proves the rule with a royalty on a patent application – I have to wonder if there is a family attached to that, or did you obtain the royalty with other considerations

  35. Ron Hilton July 4, 2015 2:21 am

    Anon,

    Examiners are human and make mistakes, but if they have the right prior art in front of them, for the most part they will reach the right conclusion, or if not, there is always the ability to appeal. Inadequate search is the main problem when it comes to patent quality. Certainly more training and better supervision is needed at the USPTO, and that is part of the solution too. But that alone will do like to get at the root of the quality problem. The real answer is more thorough search for prior art.

    Regarding the provisional, that was to a company that I founded, but was let go when then had financial difficulties. So I developed a new idea and patented it. They liked it and infringed it, claiming that because I was a former employee, they should own it. I got an attorney to talk to them, and in addition the company was about to be acquired by IBM and probably did not want any loose ends, so they settled with me and paid for a license. My family had nothing whatsoever to do with it. Bottom line, the company realized that it was a good potential patent and so did IBM.

  36. Anon July 4, 2015 6:57 am

    Your provisional – without more – lasts a year – without the promise of a real patent, your story here smacks merely of yet another shell game.

    Sorry Ron, but your position just does not hold up to scrutiny.

  37. Curious July 4, 2015 12:26 pm

    Examiners are human and make mistakes, but if they have the right prior art in front of them, for the most part they will reach the right conclusion, or if not, there is always the ability to appeal.
    So why are we talking about a two-tier system?

    A basic search and examination could give the presumption of validity, but with a low evidentiary standard to overturn it, and no right to sue.
    If you cannot sue on it, what good is it? Who would bother to overturn a patent that cannot be used to sue somebody? A presumption of validity has little value if the patent is never going to be subject to attack (because the patent, itself, cannot be used to attack).

    I understand your point about gradually doling out the rights (in the bundle of rights associated with a patent) as the level of examination increase. However, until the right to sue somebody (and obtain damages and/or an injunction) is acquired as part of those bundle of rights, the patent is essentially worthless.

  38. Ron Hilton July 4, 2015 5:11 pm

    Anon, Curious,

    You both seem to be making the same assumption – that IP rights are “worthless” until they have been fully perfected. The point I have been trying to make is two-fold: First, the perfecting of IP rights is always a matter of degree. They are never iron-clad, but become progressive stronger as they pass various hurdles and overcome successive challenges, either at the USPTO or in court. Second, the free market system is forward-looking. Investors and business always look at the future value of any asset vs. the risk of losing it. They do not put blinders on and say, “this is just a provisional patent – it is worthless” but instead the actually look at the content of the application and make their own informed judgement as to its potential. That provisional that was non-exclusively licensed from me for about $200K several years ago has since blossomed into an issued US Patent, another pending divisional, 4 foreign patents, and 2 pending foreign applications. The company that now owns it values it in the millions of dollars.

  39. Anon July 4, 2015 5:50 pm

    The basic Quid Pro Quo would need to be broken down and somehow reconstructed into at least three distinct portions for any sense of “gradual” bundle of rights demarcations (the more gradual, the more broken down distinct sets you will need).

    You would thus necessarily invoke multiple levels of submission – and clearly – these would be at multiple times in order to meet any of the goals of the tiered system as put forth.

    Clearly, the system put forth lacks basic and foundational thinking – all it is is a shell game of “divided” rights “just because.”

    Eminently, the divider here appears to be “money paid.” But that has no basis in the underlying legal exchange. All you have is a false promise of “possible quo” for all of the quid that is currently given in the present deal. A “promise” of “maybe” in exchange for giving less rights now. Only a F00l would suffer such for their clients, ans surely this is one of the worst possible answers to the law as written being twisted and perverted.

  40. Anon July 4, 2015 5:54 pm

    and Ron – you quite miss the point that it was the realization of the application into a patent that perfected the worth – somehow you have blinders on and think that the worth would still be there if a lower tier item was left as such.

    You seem to lack the intellectual grist necessary to understand the topic and I believe that you are just incapable of seeing that your system just cannot work.

  41. Curious July 4, 2015 6:44 pm

    You both seem to be making the same assumption – that IP rights are “worthless” until they have been fully perfected.
    A good assumption — particularly these days when even the right to sue doesn’t get one much. These days, a patent holder really needs to sue somebody before they’ll take the patent holder serious. This means beyond the right to sue, a patent holder need to be capitalized enough to sue (no easy task for a smaller entity). Anything short of that and the patents are, in essence (if not in fact), worthless.

    Second, the free market system is forward-looking. Investors and business always look at the future value of any asset vs. the risk of losing it. They do not put blinders on and say, “this is just a provisional patent – it is worthless” but instead the actually look at the content of the application and make their own informed judgement as to its potential.
    I’m not sure what market system you’ve been dealing with recently, but I’ve been in that marketplace the last few years. The value of a patent application alone (i.e., not part of a patent family with issued patents) is almost always less than the cost one invested in preparing and prosecuting the application.

    There are 3 main purchasers of patent assets: (i) operating companies; (ii) NPEs; and (iii) aggregators (a blend of the first two). Sophisticated operating companies know that it is nearly impossible for a smaller entity to assert a patent so most don’t even bother negotiating. Aggregators get there money (one way or another) from the operating companies, so they have little incentive to purchase patents from small entities. What is left is NPEs and they are cherry picking while dolling out pennies (just a few) on the dollar of the assets.

    That provisional that was non-exclusively licensed from me for about $200K several years ago has since blossomed into an issued US Patent, another pending divisional, 4 foreign patents, and 2 pending foreign applications.
    Ahhh … the golden years. Trust me, that market is long gone.

  42. Ron Hilton July 4, 2015 8:02 pm

    Even with the current system, the quid pro quo is a risky proposition. The application gets published long before the rights are fully realized, if ever. Formalizing the steps for perfecting the IP right into a tiered structure makes no difference in that regard.

  43. Ron Hilton July 4, 2015 8:07 pm

    It has always been the case that practicing an invention (e.g. through a start-up) usually brings a far greater return than licensing or selling it to someone else. But the best way to get back to the “golden days” is to fix the problems with the system, including patent quality.

  44. Anon July 4, 2015 8:53 pm

    It absolutely makes a difference Ron. The difference being that you are building in an artificial stopping point and offering nothing in the bargain for stopping there.

    And yes, the change in 1999 (American Inventors Protection Act of 1999 (AIPA)) was a ripoff on the Quid Pro Quo. That does not make it right, nor support your position. There are indeed aspects of the AIPA that align with reason – such as the fact that foreign equivalents are published, so those pursuing that path have not lost anything, as well as the option to take the non-publication path (which by the way, is standard advice to my clients – even those that may later foreign file).

    As to your post 43 and quality of examination, I would posit that THAT is what needs the focus (and not any sense of this tiered nonsense). You fix that and you have no reason for inserting tiers – and the insertion of tiers itself does ZERO to fixing the actual problem.

    Mutatis mutandis

  45. Ron Hilton July 4, 2015 9:36 pm

    Anon,

    There is a HUGE benefit for pausing at a lower tier – cost savings! As you like to point out, there is no reason to “gold plate” every application. The tiered system allows one to match the cost to the benefit. Most patents will never need to be enforced. They are just there on the shelf as insurance. But when market/business conditions dictate, a given patent could be upgraded as needed to meet those conditions, providing a huge overall cost savings. As to improve examination, that is of course a laudable goal. But a single human being can only do so much in terms of a thorough search. Getting the relevant prior art in front of the Examiner, as opposed to a Judge/Jury long after the fact in a very expensive court proceeding, would be an eminently practical and cost-effective approach.

  46. Curious July 4, 2015 11:53 pm

    There is a HUGE benefit for pausing at a lower tier – cost savings!
    I can fix a lot of things during prosecution, but I cannot fix a poorly-drafted application. If you have any anticipation of “gold plating” your patent at some point, you need to invest the resources upfront during the drafting stage. Just a rough figure (and extremely variable), but the drafting fees are about 50% of the entire prosecuting costs.

    They are just there on the shelf as insurance. But when market/business conditions dictate, a given patent could be upgraded as needed to meet those conditions, providing a huge overall cost savings.
    For a patent portfolio of even just a modest size, I suspect there would be little difference in costs to fully prosecute every patent versus continually to evaluate the market and identify whether a patent needs to be upgraded or not.

    Also, and probably the biggest obstacle you’ll face, is that all of these unexamined (yet capable of being examined) patent applications will characterized as undefined roadblocks to progress. While I always recommend always having a continuation pending with any economically viable technology, this is infrequently the situation. As such, in today’s environment and once a patent issues, competitors have a very good idea as to what will infringe and what will not — not so for these unexamined applications. Also in today’s environment, even if a patent hasn’t issued, a competitor can look at the prosecution history and see what prior art has been applied to get an idea as to what cannot be protected.

    The end result is that these unexamined patents will be attacked (philosophically) as 20 year potential roadblocks that chill the development of products in whatever space the claims of those unexamined happen to cover.

    For example, one could file a patent application with claims that cover old (albeit not widely published) technology (or perhaps technology that cannot be patented because of a bar date) with the intent never to have those claims examined. Any potential competitor, doing a freedom to operate search, may come across that application (and claims) and since the claims haven’t been examined, the competitor will be chilled from going into that space if they don’t know of the invalidating art (or bar activity).

    In this regard, prompt examination provides two functions — (i) it informs the public (and inventor) what rights the inventor has and (ii) it informs the public (and inventor) what rights the inventor cannot have. Without prompt examination, there will be a cloud over what is or is not patentable. To that end, prompt (not delayed) examination should be the goal. Aside from the backlog and giving Applicants sufficient time to prepare a response, examination could/should be concluded in 2 or 3 months — not 2 or 3 years (or much longer).

  47. Curious July 5, 2015 12:05 am

    But the best way to get back to the “golden days” is to fix the problems with the system, including patent quality.
    No. The golden days are over because the risk/reward calculus for enforcement/infringement has been heavily tilted in favor of the infringer. A huge chunk of issued patents (particularly those in high-value technology fields) are now subject to attack from 35 USC 101 with little certainty as to what will be declared as being “directed” to an abstract idea or law of nature. IPRs have also made it much easier to delay and increase the cost of litigation. IPRs also eliminate the presumption of validity (one of the rights in that bundle of rights), and the loss of this right necessarily decreases the value of the patent. These developments have introduced substantially greater risk and uncertainty when asserting a patent and have caused the near collapse of the patent market.

  48. Ron Hilton July 5, 2015 2:20 am

    Curious,

    Even if drafting is 50% of the cost (which sounds about right) that is still a sizable savings. And compared with the cost of a top-tier examination with a relatively expensive crowd-sourced search, the cost differential would be much greater.

    Of course your critique of unexamined patents applies specifically to a patent registration system, which may or may not be the lowest tier of a multi-tier system. Anyway, either the patent holder or the prospective infringer could request examination if the patent were deemed to warrant it. That would be precisely the case in which a greater expenditure would make sense. At the very least the competitor would want to inform the USPTO of any relevant prior art. Since it’s in a space that they operate, they should be familiar with the prior art.

    I agree that the courts have totally misapplied section 101. But I believe that the underlying problem is one of patent quality, and 101 is the easiest tool for the courts to use when such patents come before them. By requiring a more thorough search and (re)examination before a patent even gets litigated, the overall rate of invalidation by the courts would drop significantly.

  49. Anon July 5, 2015 8:00 am

    Ron,

    You continue to believe in a fantasy world.
    Your tiered system is worthless.
    You solve nothing with it.
    You ignore the basics upon which the patent system is built.

    There is NO benefit to your lower tiers.
    None.
    A right that is not enforceable is not a right at all.

    You are selling “a chance” at a right, and giving NOTHING for what you are selling comparatively to the system today. As I mentioned, only a F001 would pursue this path for their clients. You have added nothing of substance to change this equation. Repeating your empty proposition is exactly like the additive identity property.

    And it is exactly what merits the mere baseline of my initial post.

    And you add layer upon layer of misunderstanding. Your last notion of crowd-sourced as relatively expensive… You do realize that crowd-sourcing is being pushed for the opposite reason, right? That such is deemed relatively inexpensive?

  50. Benny July 5, 2015 8:14 am

    Anon,
    I think that Ron is trying to sell us a version of the German utility model, (Gebrauchsmuster) which is only examined on its’ merits in case of alleged infringement. It must serve some purpose or the Germans wouldn’t offer it. On the other hand, it must be asked why it is only available in ex-Axis power countries.

  51. Anon July 5, 2015 9:03 am

    Ron is selling something of no comparative value. He fails to recognize the baseline rational for having a patent system, the history and meaning of that system, and only sees what he wants to see.

    I care not at all about the German system in comparison to what the US system is and does. If he wants to sell something, he has to address things that he is apparently blind to seeing in the first place, let alone understand them. He has latched onto something that he likes and all he can see is his liking. Thanks but no thanks for the abundant reasons already given here and in voluminous detail previously.

  52. Ron Hilton July 5, 2015 11:12 am

    Crowd-sourced search is more expensive than traditional search, but also more thorough and effective. But it is far less expensive than a lawsuit. For the independent inventor or small start-up, the cost would be high but not prohibitive if it is needed. It would be a worthwhile investment in terms of improving the quaility/strength of the patent, reducing the need to go to court by convincing the infringer of the likelihood of losing a lawsuit. Have the right to sue under the current system is of little value for those small entities which could never afford it anyway.

  53. Benny July 5, 2015 11:18 am

    Ron,
    What contributes to the expense of crowd-sourced search? The industry would willingly expend time and effort to find prior art with which to invalidate competitors’ patent applications, at no cost to the USPTO.

  54. Anon July 5, 2015 11:46 am

    of little value for those small entities which could never afford it anyway

    That is a different problem – and be careful of what you wish for as a result thereof.

    As to “more expensive,” let’s see the data to back up your statement, Ron. I know of no such confirmation. Quite the contrary, the animus behind crowd-sourcing is that it is cheaper because you are involving “the crowd” that has ready – and cheap – access already. You are just making things up now.

  55. Ron Hilton July 5, 2015 1:33 pm

    Benny, one would think that private industry might be more proactive in providing third party prior art, but such has not been the case. Often companies may not even be aware of obscure prior art that exists in the academic or industry association literature. That was my personal experience with hardware emulation – I had to do a lot of research to find out the true state of the art. As a result, I decided to file fewer and narrower patents than I otherwise might have done. The problem was that others who were blissfully ignorant did file and obtain some patents which gave my start-up company some grief, even thought they were invalid,

    The USPTO’s Peer to Patent pilot program in crowd-sourced was moderately successful, but until a patent becomes commercially important it’s nearly impossible to get industry involved on a “pro bono” basis. The second phase of Peer to Patent was more successful, because they worked with Article One Partners who do crowd sourced search as a business, paying a bounty for the prior art. That gets people motivated. The cost for an Article One search is $15-25K – expensive but not prohibitive.

    Anon, I’m afraid that You are the one living in the fantasy world – the patent world is crumbling around you and you continue to believe that only if the USPTO would work harder and do a better job of examination, all would be well. The problem is that the state of technology has gone far beyond the ability of a single examiner to do an adequate job of searching the prior art. As a result, patent quality has declined, bad court decisions and patent reform legislation have ensued, and the market for patents in general has been decimated. But you will go on chanting “quid pro quo, quid pro quo” until the end, when those who want to “open” the patent system finally get their way.

  56. Curious July 5, 2015 2:45 pm

    Benny, one would think that private industry might be more proactive in providing third party prior art, but such has not been the case.
    They are not because private industry is in the business of making money — not doing prior art searches.

    As a result, I decided to file fewer and narrower patents than I otherwise might have done. The problem was that others who were blissfully ignorant did file and obtain some patents which gave my start-up company some grief, even thought they were invalid
    My recommendation to any non-prosecution attorney is let me (the attorney doing the patent prosecution) worry about the prior art. Just disclose what you think your invention is and we’ll then figure out if it is patentable. You can always pull back on the scope of your claims — you cannot file on technology that you (mistakenly) thought was unpatentable two years ago.

    The USPTO’s Peer to Patent pilot program in crowd-sourced was moderately successful
    LOL … appealing to the goodwill of others is a practice that will not last long. Eventually, the novelty of (unpaid) contributions to the common good wears off.

    As a result, patent quality has declined, bad court decisions and patent reform legislation have ensued, and the market for patents in general has been decimated
    Improving patent quality will not change bad court decisions and the cast of characters pushing for patent reform legislation still have the same motivation to continue to do so. Don’t get me wrong, I’m all for improving the quality of patent examination. However, where the mantra of ‘do as little as possible to reject the application and get your count’ has been ingrained into a good many of the Corp of examiners, there isn’t much we can do from the outside.

    This is an inside problem that needs to be dealt with by the people inside the USPTO.

  57. step back July 8, 2015 7:23 am

    Curious @56 write:
    Improving patent quality will not change bad court decisions and the cast of characters pushing for patent reform legislation …

    The crumbling micro world of “patents” is just an example of a bigger problem in which ordinary people are incapable of coping with extremely advanced technology and believe it all to be mere magic.

    We saw an example of that point blank in the oral hearings of the US Supreme Court in the MYRIAD decision and in the ALICE decision. Judges who believe a computer system can be programmed overnight by a bunch of coffee shop nerds. Judges who believe that individual DNA strands can be found with mere wave of a magic wand. Judges who use nonsense words like “natural laws” and “generic computer”. The people in our legislative branch are no better.

  58. Curious July 8, 2015 7:18 pm

    Judges who believe a computer system can be programmed overnight by a bunch of coffee shop nerds. Judges who believe that individual DNA strands can be found with mere wave of a magic wand. Judges who use nonsense words like “natural laws” and “generic computer”. The people in our legislative branch are no better.

    Let’s add Judges (actually a Supreme Court justice who once argued trees should have standing) who have divined an “abstract idea” exception out of 35 USC 101 despite anything that is a “process, machine, manufacture, or composition of matter, or any new and useful improvement thereof” does not mean the plain meaning of the term “abstract.” Hence, we have an exception to 35 USC 101 that is both completely untethered to the statute and undefined.

    It is sad state of affairs that the judiciary has so completely screwed up patent law that no one can know (with any certainty) what classes of inventions are eligible for patenting or not. Without this knowledge, the licensing of technology stalls, infringement is rampant, and there is little incentive for inventors to bring new technology to the market for lack of assurance that the inventors will profit from the fruit of their labors.

  59. Anon July 9, 2015 7:43 am

    The ultimate nose of wax.