A toxic concoction of myth, media and money is killing the patent system

toxic-300-300In the past decade, the patent system has been turned on its head.  Inventors are now villainized as cartoon characters called patent trolls simply because they assert their hard-earned patent rights against corporations who steal their inventions.  These infringing corporations have cleverly cultivated the myth that all patent owners are patent trolls by engaging high-powered lobbyists and public relations firms to loudly attack inventors.  This toxic concoction of myth, media and money has gagged opposing voices effectively creating political cover for the government to make rapid and fundamental changes to patent law that skew the field toward big corporations at the expense of inventors and small innovation companies, including those high tech start-ups that are responsible for creating high paying jobs.

The Obama Administration, the courts and Congress have destabilized the patent system for the least able to withstand instability – inventors and small innovation companies. A quagmire of confusing and contradictory law has rendered tens of thousands of legally and rightfully granted patents to become unenforceable.  These changes are certainly riding the system of those who abuse the litigation process for profit, but not without slaughtering an entire generation of inventors and innovative companies along with them.  One pro-infringer lobbyist has even informed me that harm to inventors is acceptable collateral damage in their war against patents.  As remarkable as that admission was, at least he understood the damage that would come to inventors.  Sadly, it seems our government is missing the point. It is hard to know whether our leaders are in denial, they simply don’t know any better, or if they don’t really care. Whatever the case may be, they continue to hip shoot at patent trolls in the dark.

Many pro-infringer Congressional offices have argued that a “good” patent (whatever that means) is still enforceable.  While that may be true for big corporations it is absolutely not the case for inventors and small innovation companies. Indeed, this thinking clearly illustrates how little the government understands about what makes a patent enforceable in the real world, and thus valuable on the market.  They don’t understand the differences in scale, resources and motivation between the big and the small. Sure, a big corporation with deep pockets, such as Apple or Samsung, can afford to pay lawyers hundreds of millions of dollars to fight over the course of a decade. Individual inventors and start-up companies simply cannot afford to play high stakes patent litigation games, and the chipping away of rights has made it virtually impossible for patent owners to find contingency legal representation, or to borrow money to pursue an infringer.

A patent is nothing if it cannot be defended. If there is no disincentive for a big corporation to steal the invention, they will steal it and then using their deep pockets and market power, massively commercialize the innovation that was not their own.  Defending a patent, whether at the United States Patent and Trademark Office (USPTO) or in federal courts, costs millions of dollars.  While this may mean little more than a rounding error in the greater scheme of a big corporation’s financials, for inventors and most small innovation companies it means they need investment.  Patents are but one investment opportunity available to investors.  Investors are a smart lot.  They diligently evaluate investment opportunities before they write checks, examining fundamental investment concepts such as level of risk, potential return and timing.  An inventor must be able to convince investors that putting their money at risk in a patent related investment is better than putting it somewhere else.  Our current patent system makes that impossibly difficult.

An investor may wait as long as seven to ten years as the lawsuit works its way through the courts, the Patent Trial and Appeal Board (PTAB) and multiple appeals before any investment is returned.  The investor must be willing to accept the very high risk that a patent will be invalidated at some stage in the litigation, which will cause a total loss of the investment.  Even if the patent survives litigation, the investment may not be returned in full because nobody can project future damages now that injunctive relief is highly restricted and court ordered damages are falling as the result of decisions from the United States Court of Appeals for the Federal Circuit.  What this means is the current patent system actually encourages infringement, which is deemed an appropriate risk given the low likelihood of risk of loss and no real risk of an injunction.

Given how the laws have been tilted so far in favor of infringers it is unlikely that an infringer will settle early on in litigation, which means investors must commit significantly more money up front and money remains at risk much longer.  There is no way show with reasonable certainty that the investment will ever be returned, let alone at a profit.  Given this reality it is practically impossible to show that investing in a patent is better than most other investment opportunities. As bad as it is now things will only get worse if Congress passes the Innovation Act (H.R. 9) or the PATENT Act (S. 1137).

It should surprise no one that most investors have left the patent business for other types of investments.  Many contingent fee lawyers have left it too.  Even Ray Niro, the granddaddy of contingent fee patent defense who built a storied career and a highly successful law firm defending inventors against large infringing companies, has largely left the business, opting to take on patent defense work instead.  Today, an inventor is not likely to find money or legal representation to defend a patent, nor are they as likely to find investors as willing to invest in early stage start-up companies. The net effect of this investor reaction is that most patents simply cannot be enforced no matter how “good” they are.

There are multiple causes contributing to this catastrophe.  To name just a few, the severe loss ratios and high costs of PTAB procedures created under the America Invents Act of 2011, the increasingly hostile environment within the Federal Circuit to patents, the technically illiterate Supreme Court, the overworked USPTO, and a string of pro-infringer case law decisions starting in 2006 with eBay v. MercExchange, which all but eliminated injunctive relief, continuing to the present with Alice v CLS Bank scrambling the definition of what is patentable.  Just the fact that new patent reform legislation is brought up year after year in Congress creates chaos in a patent system already plagued by chaos.

Of all this damage, Alice v CLS Bank is the primary showstopper in terms of harm to innovators.

In Alice, the courts disorganized the definition of what is or is not patentable subject matter by expanding an exception to patentability called the “abstract idea”.   If the invention encased in a patent is deemed to be an abstract idea, it is no longer patentable and will be invalidated.  Poof, the property right is gone. This Supreme Court decision is extremely troubling because although the Court applies the “abstract idea” test they have never defined the meaning of “abstract idea.” To have and apply an undefined test is absurd. Further complicating matters is the very real truth that at some basic level every invention, no matter how complex, started off as an idea. In the wake of the Alice decision the “abstract idea” test has swallowed many areas of innovation whole, and is being misapplied to a logical extreme by patent examiners, Administrative Patent Judges and Federal Court Judges alike.

It should surprise no one that an abstract idea cannot be reasonably defined in concrete terms.  The courts and the PTAB have left a trail of confusing and often ridiculous rulings that have invalidated a large percentage of challenged patents.  The definition is now so scrambled that courts mix analysis of what is abstract with analysis of what is obvious or anticipated, something that prior to the Supreme Court’s decision in Mayo v. Prometheus in 2012 was absolutely prohibited. Alas, in their infinite wisdom, despite many generations of law to the contrary, the Supreme Court for the first time in 2012 decided it was appropriate to conflate patent eligibility with anticipation and obviousness. Whether or not the invention is abstract and therefore patent ineligible has become wholly dependent on the subjective opinions of whatever judge(s) assigned to the case.

What is or isn’t abstract is no longer generally understood by inventors, investors, or even lawyers.  What is abstract can’t be understood because nobody knows what means. From the perspective of an inventor or small innovation company, the consequences of this jurisprudence are enormous. For reasons not explained the Supreme Court has substantially deviated from many generations of well established patent law, bringing extreme uncertainty into a business context that demands both scientific and legal certainty to survive.

Today, a patent is effectively presumed to be invalid with only a small chance it will become valid after millions of dollars are burned over many years of litigation.  Because nobody can figure out in advance if any particular patent will pass muster, the abstract idea exception has effectively wiped out the presumption of validity for all patents in the eyes of investors in small innovation companies. This means when an investor looks at an early stage company with a patent as its primary asset (in many cases, its sole asset), the patent cannot realistically be valued as collateral for investment purposes. Investors rightly understand that their dollars invested in the new product can no longer be protected from big corporations simply copying it and overwhelming the startup in the market. Big corporations are simply responding rationally to changes in the law that are designed to allow them to misappropriate innovative products from inventors and innovative startups. It is just too risky to place any value on the patent, which means there is nothing to invest in from the investors’ perspective.

The abstract idea has proven devastating to inventors and small innovation companies. Until Alice and Mayo are corrected, the show stops for inventors and small innovation companies who happen to need investors. In the meantime, we should all be concerned. More companies are going out of business than are starting up for the first time in U.S. history. Thanks to bad policy decisions and awful Supreme Court decisions, America is killing the very engine that made us the greatest economic power in history.


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Join the Discussion

24 comments so far.

  • [Avatar for Paul Morinville]
    Paul Morinville
    October 22, 2015 05:21 pm

    SoftwareForTheWin, I took a look at producthunt.com. As far as I can tell, almost all of the companies displaying their wares are all phone app companies.

    These business models do NOT rely on new technology. They scoop up available technology and assemble it into an application. They rely on speed to market and the speedy aggregation of significant number of customers. Most make money from the customer base by providing a marketing platform or by selling data.

    The companies harmed by the degradation of patent rights are the companies that provide the next new technology that these phone app companies would scoop up. These are the real innovative companies making real technology – not the companies making consumer aggregation phone apps.

    I think the answer to Nigh Writer’s question is found in the number of new startups actually developing real technology and not in the number of companies scooping up available technology and commercializing it.

  • [Avatar for SoftwareForTheWin]
    October 8, 2015 11:51 am

    Night Writer wrote:

    “We should ask ourselves what is the best objective data that could indicate that the patent system crippling is hurting innovation.
    So, we need to find the canary. Where is it?”

    The answer is software innovation itself. It’s been happening and has been accelerating. Perhaps to get some semblance of at how dramatic it is is by taking a peek at producthunt.com – then take another peek tomorrow. I suggest that the overwhelming majority of those companies are NOT relying on patents to protect their investments in innovation.

  • [Avatar for Anon]
    October 1, 2015 10:11 pm

    As has often been added in those conversations, it is not necessarily the references you use, but it is the version of meaning that you yourself maintain from those references.

    Point blank: the statutory category of process is not a sub-category. Your version, your treatment, is not and cannot be correct.

  • [Avatar for Anon]
    October 1, 2015 10:09 pm

    The discussion concerning Curtis has been had – and Curtis has been found wanting – on several fronts.

    A treatise can indeed get things wrong Mr. Heller. Especially an ancient one.

  • [Avatar for Edward Heller]
    Edward Heller
    October 1, 2015 07:11 pm

    anon, since you come out of left field with categorical, unsupported pronouncements, may I as you for your authority as to what congress intended when it included Art in the original 101? I can give you a clue. It had something to do with “manufactures.” Now, just what could that be? I wonder?

    See, Curtis, 1867, at Sections 4-5

    [T]the words”new manufactures,” in the Statute of Monopolies, have received in construction a comprehensive import. According to the construction
    of the courts, the word” manufacture” is used in the
    statute in a literal arid a figurative sense. It is used in a literal sense, because it cleady includes any species of new manufactured article, or tangible product of industry; or a new machine, the construction or production of which, as an arrangement of matter, is the resUlt at which the inventor aims. But when it is extended to include the mode of producing an old or well-knowll substance,
    or an old and well-known effect upon matter, by a new method or process, it seems to be used in a sort of figurative sense; because, in such cases, it is the method or proccss of producing the thing or the effect that is new, and is the real subject of the invcntion; and the manufacture, or the result attained in matter, is then made to stand in the place of the llew method or process of attaining it.

    § 5. Thus,” mauufacture ” has been defined to be “something made by the hand of man” ; 1 and it has also becn held to include the practice of making a thing, or of producing a result.

    Section 9: AN ART.

    We have just seen that, in order to make a new process or method of working or of producing an effect or result in matter a subject of a patent in England, a somewhat liberal construction of the
    term” manufacture” became necessary, by which an improvement in the art or process of making or doing a thing was made constructively to be represented by the term which ordinarily would mean only the thing itself, when made or done. It was doubtless to avoid the necessity for this kind of construction that the framers of our legislation selected a term which, proprio vigore, would embrace those inventions where the particular machinery or apparatus, or the particular substances employed, would not constitute the discovery, so much as a newly invented mode or
    process of applying them, in respect to the order, or position, or relations, in which they are used.

    This difficulty is avoided by the use of the term “art,” which was intended to embrace those inventions
    where the particular apparatus or materials employed may not be the essence of the discovery, but where that essence consists in using apparatus or materials in new processes, methods, or relations, so as to constitute a new mode of attaining an old result; or a mode of attaining a new result, in a particular department of industry, which result may not of itself be any new machine, manufacture, or composition of matter; or finally, an entirely new process of making or doing something which has not been made or done before, by any process.

  • [Avatar for Anon]
    October 1, 2015 05:35 pm

    Mr Heller,

    Once again your view is just not correct. Once again, you advance your view that the “process” category is de facto a sub-category of the the other three hard goods categories.

    This is simply not so.

    Your reliance on MoT is more than just a little joke. It is an embarrassment for you professionally. It should embarrass you personally as well.

    There comes a time when your relentless, endless and quite mindless shelling for a specific viewpoint passes any sense of hope of reaching out to you and appealing to some objective sense of reason. As it is, you are nothing more than an endless loop of a very bad legal position. It’s quite sad, actually to see you like this.

  • [Avatar for Edward Heller]
    Edward Heller
    October 1, 2015 04:48 pm

    Curious, “excluded?” I think you miss my point.

    “Art” and “process” had well-developed meaning prior to ’52, essentially the MOT, with some tweaks. The question the court was presented with was whether a business method was a statutory process given this well known meaning.

    But they did not like the MOT. They had no better definition. And they had no good definition of “business method.” So they punted, creating the nonce word “Abstract” that was not known to be the equivalent of “non statutory.” The legal basis of their holding was not known, just as Stevens observed.

    Bilski may have been the worst Supreme Court patent case in history, topping Benson in its lack of clarity. (What in the world are you talking about?)

    I have come to appreciate Kennedy as a principal user of the meaningless phrase. Whether he intends to cause chaos or not, his decisions are opaque.

  • [Avatar for Curious]
    October 1, 2015 12:06 pm

    they exceeded their authority under our Constitution which grants to Congress the power to define patentable subject matter. Bilski could have been properly decided by observing, simply, that business methods were nonstatutory
    Your logic eludes me. First, of course, you have to provide a definition of a “business method.” Second, you have to explain why a business method (i.e., a process) could properly be excluded by SCOTUS. Third, you have to reconcile your statement that Congress has the power to decide patent subject matter and a process/method is part of that definition with your belief that SCOTUS could have ruled that business methods were nonstatutory.

    Ned — everyone is entitled to their opinions as to what the law means and to their policy positions. However, you are masquerading your policy positions as legal arguments. The problem I have is that your legal arguments are inconsistent with one another.

    they did so in Bilski, not in Alice
    Didn’t they do so in Benson?

    If a claim contains both statutory and nonstatutory subject matter, invention must lie in the statutory. This is a no-brainer.
    Throwing the whole “invention as a whole” concept in the garbage I see. Regardless, you are staking out a policy position — not making a statement regarding the law.

  • [Avatar for step back]
    step back
    October 1, 2015 10:58 am

    Night Writer,

    You’ll never see that canary.

    It died alone, unseen, unheard in an unmined startup tunnel.

    That’s the beauty of killing patents. It silences the wannabe disruptive startups.

  • [Avatar for Paul F. Morgan]
    Paul F. Morgan
    October 1, 2015 10:05 am

    Re: “..Alice v CLS Bank is the primary showstopper in terms of harm to innovators.” But how does supporting or opposing the pending patent legislation help that? I.e., what is in any of that proposed legislation that would have any effect on 101 defenses?

  • [Avatar for Night Writer]
    Night Writer
    October 1, 2015 09:17 am

    We should ask ourselves what is the best objective data that could indicate that the patent system crippling is hurting innovation. I think the only hope is objective evidence. The history of lobbying in the last 20 years is that they can spin anything better than anyone else. The only thing that wins is objective evidence, e.g., a bridge falling or the collapse of our financial system, etc.

    I’ve read a few articles in various journals about measure innovation such as the number of start-ups, VC money, etc. What I think is that certain sectors will take it much harder than others and broad numbers won’t look so bad for years to come.

    So, we need to find the canary. Where is it?

  • [Avatar for Anon]
    October 1, 2015 08:55 am

    Mr. Heller,

    Your “no brainier” is brain dead. I will not labor to repeat the voluminous points raised against your position here, as I have not witnessed any attempt on your part to seriously join a conversation on the merits.

  • [Avatar for Edward Heller]
    Edward Heller
    October 1, 2015 07:11 am

    Paul and Gene, I agree that there hasn’t been a war on patents for some time being conducted by such of the major corporations that have been afflicted by the so-called troll problem. But they have gone too far, especially when they advocated for and created IPRs, an unconstitutional procedure that alone might sink the patent system.

    The Supreme Court has not helped, especially with its eBay decision.

    I also agree that when the Supreme Court created “Abstract” as an Exception to otherwise patentable subject matter – they did so in Bilski, not in Alice – they exceeded their authority under our Constitution which grants to Congress the power to define patentable subject matter. Bilski could have been properly decided by observing, simply, that business methods were nonstatutory. But the majority instead decided to go a different route and created a Judicial Exception. They further complicated the situation by employing the nonce word “abstract” that has no well-defined. Uncertainty, if not chaos, was and is a predictable result..

    That said, Alice and Mayo were otherwise properly decided. If a claim contains both statutory and nonstatutory subject matter, invention must lie in the statutory. This is a no-brainer.

  • [Avatar for Benny]
    October 1, 2015 05:19 am

    Bottom line, patent law is not functioning properly, in no small part because patent enforcement has been priced out of the market. Perhaps you can tell me who is setting price.

  • [Avatar for Night Writer]
    Night Writer
    September 30, 2015 05:28 pm

    One thing that many people don’t mention is the affect that patents have on employment contracts and the effects of secrecy.

    What is going to happen: trade secrets mean that corporations don’t let you move to another corporation and your value is reduced. Also, you won’t be able to publish what you done. I remember in the early 1980’s one big area of research at Intel I think was building a chip that decoded the instructions on the chip so it would be almost impossible to reverse engineer the software. Patents changed all that. Microsoft was crazy about secrecy.

    I’d feel better about information processing not being eligible (if we get there), if it were by Congress and not the SCOTUS.

    Still waiting for someone to make cogent arguments about why Alice is unconstitutional. It clearly is. You can’t create an exception that includes an analysis of another cause of action. (I.e., you can’t create a 101 exception that includes a 103 analysis. It eclipses the statute and does not provide a right to a jury.)

    $40K to write and prosecute a patent and $400K to defend it just once in an IPR by anyone with no standing. A sport of kings and queens to be sure.

  • [Avatar for step back]
    step back
    September 30, 2015 04:58 pm

    Paul @8

    Brilliant come back.

    Where can I get my velvet Paul portrait? 😉

  • [Avatar for Paul Morinville]
    Paul Morinville
    September 30, 2015 03:43 pm

    John, That’s interesting relating inventors to musicians. Perhaps there are differences between the two. It seems that revenue in music can be generated in multiple ways. The musician can be recorded the song and sell it, or play it in a live performance. A good musician can garner a certain amount of celebrity that can generate additional revenue in other ways as well. Like selling velvet Elvis paintings like the one hanging in my office.

    An invention can only be the product. There is no live performance that an inventor can do. Nobody is ever going to sell a velvet Paul painting to hang on their office wall.

    I think patent theft is more akin to copying Microsoft’s copyrighted OS and installing it on millions of computers without paying Microsoft. Microsoft can’t make any money by performing the OS on a stage in front of people like a musician can.

  • [Avatar for Gene Quinn]
    Gene Quinn
    September 30, 2015 03:43 pm


    How many artists make millions of dollars? You say it as fact, so I assume you have some support other than a guess.

    In terms of the patent system having a positive impact on software, well… you are dead wrong of course, but I suspect you know that.

    You say that hardly any software patents are enforced, but that is because of the awful decisions of the Supreme Court which are terribly misguided. It is also the result of the PTAB and the other Federal Courts going even further than the Supreme Court.

    It is pretty straight forward that without patent protection you get insignificant change and no real innovation. In a world where people can copy everyone that is what they do rather than innovate. That is why the open source business model has been such a terrible failure. You seem to believe open source has been a panacea of some kind, but quite the opposite is true. In fact, you don’t see any company of any meaningful size pursuing an open source business model. You do see a lot of small companies that have a high rate of failure pursuing open source. I hear from them a lot when they come up with something new and they want to patent what they have and prevent others from using it. Funny really.

    As for the patent system and software, if you want real investment in software, the kind that GE is doing with respect to windmills, the kind that IBM is doing with respect to artificial intelligence, the kind that Google is doing with respect to autonomous driving, you have to have a functioning patent system with strong patent rights. Making the investment is really quite stupid if you can’t own what you create. All you are doing is inventing so that competitors can free ride on your creations without having to invest. All your position does is guarantee that the creator will be unable to compete with the free-riders because the creator must recoup the cost of R&D where the free-rider has nothing to recoup because they simply took the innovation.

    Seriously, you seem to comment as if you are involved in the software industry but you seem to have very little functioning knowledge about the law and about the business. You almost come across as one of the crazies who thinks that software is easy to write and requires very little effort. Anyone seriously familiar with the industry knows that creating and maintaining functioning software is very difficult and time consuming. Apple, GE, Google, IBM, Microsoft will employ hundreds of people on a project for years in some cases. To pretend that level of investment will happen in an environment that encourages infringement is ridiculous.


  • [Avatar for John Mathon]
    John Mathon
    September 30, 2015 03:00 pm

    Good points by all. I think there is no clear answer which way to go in all cases. I have thought about this a lot. Let’s look at the music industry. There is massive copyright infringement. Artists these days are making most of their money from performances. What I struggle with is that there is no loss in music creativity or quantity or quality. We have more music than ever. I can find great stuff easier and the artists seem to be getting paid. Maybe they aren’t making billions like some former artists did but they are making millions for sure. The amazing thing about music versus other IP is that when you are 72 years old in a strange city somewhere in Tennessee if you had a hit in the 60s or 70s that people recognize you can get a gig and get paid. There is virtually no other IP you can do that with. Software is another case where it would be impossible to argue that the patent system has had any positive impact on inventiveness or profitability of companies. Hardly any software patents are enforced. This whole process is incredibly slow and costly compared to the cost of reinventing software a different way. The whole industry is in a massive innovation spike with incredible number of successful companies. 7 or the Unicorn 140 are open source companies. I am not saying this is replicable to other industries but I am wondering why it is different? I understand the theory of why we want to protect our IP. I understand that in theory the loss of IP value essentially puts high IP countries like the US at risk but in fact this is not happening at least today. Maybe the lead we have in software is so commanding that we don’t see competition yet but down the road our companies may suffer from others being able to copy willy nilly. My point about less penetration is very important. Today companies need to use technology fast and easily. Open source is becoming the preferred way to get software more and more. I think what we need to identify is what are we trying to protect against? We want innovators to be rewarded. The little guy but Mark Zuckerberg invented the “relationship status” field in Facebook. This is touted as some great IP as if he had discovered General Relativity. What ridiculousness. Should Mark be protected for inventing relationship status? I don’t think so. That’s not defensible. If someone invents something that really took some effort to do then I can see it. Unfortunately that’s not the usual way a small inventor can work. Today, it’s not only that your idea is great but that you’ve also worked out the uses, market, etc… The idea by itself is not that much. We have a trillion ideas. I think we could argue this indefinitely. I am siding that if we have the culture and infrastructure to create IP in large quantities then people who steal old ideas and can’t create new IP will fail. People aren’t living off old ideas and maybe they shouldn’t. Things are moving a lot faster than they used to.

  • [Avatar for nat scientist]
    nat scientist
    September 30, 2015 01:32 pm

    You could say crony capitalism and the Supremes have bombed innovation back to the Stone Age, where dinosaurs roamed the earth and fires were found in secret caves. This reminds me of what Kissinger and Nixon had in mind for North Vietnam, not the STEM Individuals and disrupters of monopoly colonization, but that is one of the spoils of the war economy.

  • [Avatar for Paul Morinville]
    Paul Morinville
    September 30, 2015 01:18 pm

    John @ 1. If an invention can be secured behind code or within a data center, it is unfortunately better to keep it as a trade secret. However, if the invention can easily be reverse engineered and copied, the only protection is to patent it.

    My inventions could not be hidden so I patented them. This did not stop anyone from taking them. A few infringers morphed their failing companies to my technology which made them successful. They had the head start of existing VC backing (including access to more money), existing software development, marketing and sales teams as well as some existing customers. The market expanded with dozens of companies infringing on my technologies, and then consolidated as several of these companies were acquired by larger companies. Large companies incorporated these acquisitions into their product stacks and massively upgraded their customer base thus saturating the market. This all happened within a few short years. In all, 18 years of the industry going the wrong direction changed overnight on my inventions. It took 7 years just to get the first patent and by then the market had grown to $12B. Since then the patent system has collapsed.

    There are only two ways to compete in a market dominated by giants. One is exclusive to those with lots money and other resources. For those without money and resources, patenting the invention is the only way to attract it.

    The reason so much money is dumping into Washington to buy patent reform is new technologies can make Incumbent players in tech irrelevant in just a couple of years. If patent protection is eliminated for upstarts, they keep their incumbent position.

    However, weak patents will drive innovation overseas where patent protection is getting stronger. We’ll keep the Google’s of the world, but will not create the next generation – China will.

  • [Avatar for Curious]
    September 30, 2015 12:36 pm

    For one thing it discouraged some people from working with our technology making it less ubiquitous than it could have been
    What discouraged them is what you asked for in compensation.

    second there turned out to be dozens of companies that found a way to build software similar to our patent that we really weren’t able to prevent people from re-inventing our idea
    Perhaps your claims were too narrow? Perhaps you should have anticipated how people would have ‘reinvented your idea’?

    Any system used poorly can seem to be not useful. However, that doesn’t mean the system is, per se, not useful. It just means your use of the system was inefficient.

  • [Avatar for Curious]
    September 30, 2015 12:28 pm

    A great commentary destined, unfortunately, to fall on deaf ears.

    As a matter of basic business/investing principles, greater uncertainty = greater risk; greater risk = greater return (for investor); greater return = less invested (for same payoff). The “less invested” means that inventors that don’t have their own sources of capital (unlike large corporations) are getting less investments in their ideas. The corollary to this is: less investment in ideas = less ideas produced.

    The current hobbling of the US patent system by all three branches of Government (USPTO, as directed by the administration, Congress, and the Courts) has put the US on a clear path to a decline in our standard of living. If we cannot protect our innovations, then we’ll be forced to become a society that competes on labor cost — not a pleasant prospect.

    I don’t want to admit that the infringers of the world have won the war (although I suspect the Chinese and certain large corp, high-tech CEOs are putting champagne on ice), there is no doubt that they’ve won just about every significant battle.

  • [Avatar for John Mathon]
    John Mathon
    September 30, 2015 12:23 pm

    Paul, while I have written 10 patents in my life, some of them significant and enforced (TIBCO publish subscribe for instance) I have not found the patent process to be that useful. I am more and more believing at least as far as much of software it is not the way to go.

    I wrote another patent soon after the first publish subscribe that patented a technology for publishing something twice to improve latency and reliability of message transfer. I used this technology in a startup. It was powerful selling point. Later I discovered some other companies had used this method to build a messaging system for trading floors. I could have tried to sue them. I have resisted efforts to do that partly because I found that our successful prosecution of the pub sub patent did not really do that much beneficial for us. For one thing it discouraged some people from working with our technology making it less ubiquitous than it could have been or might have been and second there turned out to be dozens of companies that found a way to build software similar to our patent that we really weren’t able to prevent people from re-inventing our idea.