Classical understanding of the world around us includes various laws that objects in our Universe obey, such as the Law of Gravity propounded by Isaac Newton. These physical laws were tweaked a century ago by Albert Einstein to include odd scenarios not adequately described by Newtonian Mechanics, e.g., traveling near the speed of light.
Not long after Einstein’s discoveries, however, experiments in subatomic physics presented considerable challenges to these classical views. The disparity of these observations with the “real” world ultimately resulted in an agreement among physicists on the interpretation of reality itself, the Copenhagen Interpretation, which was necessary to establish a common platform for physics and mathematics. Quantum Mechanics developed as a statistical model in this alternate reality, where laws were replaced by rather uncertain estimations.
Our patent system was also been built upon classical rules and understandings, e.g., earlier patent systems, and the thoughts of Rousseau, Locke and others who influenced our Founders in the creation of our patent system. For over 200 years our patent system has been operating within the paradigm or mindset that innovation should be encouraged by providing a personal incentive to benefit the innovator (in the short term) and Society as a whole (over the long term).
This reality, however, is now under question, i.e., the George Washington Interpretation that a patent system is good for the nation. As with Quantum Mechanics in physics, a new reality has been thrust upon us that the patent system is actually questionable, uncertain or even bad. This new view is the Troll Interpretation. Instead of American inventors creating a better mouse trap, bettering Society, they are now trolls, every one of them it seems. This new interpretation is a long way from the veneration accorded inventors, including great American innovators, such as Morse, Bell, Edison and others. Indeed, the press goes into overdrive denigrating famous inventors, such as the Wright Brothers, as trolls.
The U.S. Supreme Court, which for two centuries acknowledged the importance of patent rights, has also brought the George Washington Interpretation into doubt by undermining the entirety of the patent system in the recent Oil States case, where patents of innovations are now deemed mere tools of the government, and not the innovator’s private personal property. But this is just the latest in numerous decisions over the past decade or so where the Supreme Court has curtailed and belittled patent rights. All of their many negatively-postured opinions have denigrated the value of patents and investment in innovations relying upon patent rights. Indeed, the Supreme Court has directly created considerable uncertainty in a once fairly certain world of patent valuation.
In physics, there is an interesting experiment involving light passing through two narrow slits. Under classical physics, light, as a particle, should pass through and hit a detector on the other side in two places corresponding to the placement of the slits. But this is not the case. Instead, there is a continuum of values detected corresponding to light wave interference, i.e., the light, as a wave, actually goes through both slits and interacts with itself on the other side. One cannot predict with certainty where any given light ray will hit the detector. All one can do in this uncertain environment is to employ statistical techniques to guess.
Right now, the Supreme Court jurisprudence on many important patent issues is just as uncertain, creating further havoc with the George Washington Interpretation. Indeed, it is hard to decipher meaning from the diverse opinions of the Court as to how to proceed. Each new decision further disrupts the patent paradigm in unknown and uncertain ways, but overwhelmingly negative. The Court does not seem to understand the criticality of the issue and the crises so generated.
Modern innovation relies on funding, and one must demonstrate that one can deliver on a promise, e.g., investment requires some certainty to the investor or banker. In the past, the key assets were physical in nature, e.g., a factory lease and the latest printing press for a startup printing business – known values. Now, the assets are far less tangible, e.g., an app or a therapeutic kit, but far more valuable, and very much in need of patent protection. Yet, apart from Justices Gorsuch and Roberts, the Supreme Court appears unable to accord patents the proper status in this equation, creating further uncertainty in the marketplace, preventing many businesses from forming and thwarting innovation itself.
Also, if a valuable invention covered by a patent can be invalidated with ease, e.g., in one of the new and slanted-against-the-inventor USPTO proceedings, why invest in R&D that cannot be protected? This scenario affects critical technologies, such as new techniques and therapeutics to detect diseases. For example, the Cleveland Clinic has recently curtailed critical research in view of the lack of ways to protect these techniques with patents. Indeed, abuse of Section 101 of the Patent Act has reached a precarious level. The investment calculus is simple: if too uncertain a patent can be obtained, and if obtained, too uncertain regarding enforcement, then no funding. This fundamental principle of economics is apparently lost on the Justices.
In Congress, under intense lobbying, they passed the America Invents Act (AIA) in 2011 to increase the “certainty” in the patent system. Despite the warnings beforehand that this was not so, this lobbyist- and troll-inspired law has morphed into a miasma of confusions and uncertainties. Now, Congress is having hearings to establish what they did wrong, and asking fundamental questions. Why has our patent system, once number one in numerous rankings, fallen to 12th place? Why are foreign patent systems more conducive to critical innovations in software, AI, diagnostics and therapeutics, and our Patent Office and the courts deny these innovations the right to be patented? Why is trade secret protection, in lieu of patenting, become so huge? Why are we indulging in this national self-destruction?
The new USPTO Director Andrei Iancu is trying to fix this horrible situation, where we have skewed so far from the George Washington Interpretation into extreme uncertainty that threatens the nation. He wants to change the dialogue and stress the positives of patenting, the positive portrayal of our famous inventors, and turn back many of the bad measures of the AIA. With the Supreme Court Justices rejecting the Founders’ view of patents, Congress will have to now step up and bolster our patent system. Senator Coons and others in Congress recognize America’s innovation slide, the proper role of patents, the bad press regarding patents, and the need to create certainty in business dealings. As our economy heats up further, patents will be even more critical to secure the fruits of American ingenuity in a complicated and intense world market.
George Washington, Thomas Jefferson and many others, including Abraham Lincoln, recognized the extraordinary value of the U.S. patent system, and talked and wrote about its virtues. A few bad actors should not have derailed this critical engine of our economy, but they did, and now all patentees are labelled trolls. Thus, a new portrayal of patents is needed. It will take time to educate the press, reintroduce the positive advantages of the patent system, and stop the slide. We must, however, watch out for the truly bad actors here, some of the big tech lobbyists who still want to curtail patents (to curtail competition), which keeps the patent system under threat.
The uncertainties in physics should not be mirrored in our patent system. The reality of the Founders is not alien to us: hard work, and reward creativity and innovativeness. Modern inventors of new advances should not be harmed due to the perverted view of the patent system being foisted upon us. We need to reaffirm the George Washington Interpretation. Director Iancu has his work cut out for him: Make American Invention and Inventors Great Again!