“Courts should never be tasked with dealing with the complexities of patent validity because they lack the necessary technical expertise.”
I am Emil Malak, CEO of VoIP-Pal.com Inc., and a named inventor on two U.S. patents–Mobile Gateway: US 8,630,234 & Electrostatic Desalinization and Water Purification: US 8,016,993. To date, our company owns 22 issued and or allowed patents, which we developed over the past 15 years. Against all odds, we have been 100% successful in defending eight Inter Partes Reviews (IPRs): four from Apple, three from AT&T, and one from Unified Patents. We are presently in litigation against Apple, Verizon, AT&T, Twitter and Amazon.
My experience with Voip-Pal has made it painfully clear that the deck has been stacked against companies who own IP being used without license by large tech companies. The America Invents Act (AIA), orchestrated by Silicon Valley, was designed to destroy the very ladder they climbed to ascend to their lofty perch, and make certain that they could not be challenged.
Tipping the Scales of Justice
Owning a patent used to be the dream of every small inventor in America. For more than 200 years, the intellectual property rights of American inventors—both big and small—were protected by patent laws that encouraged innovation and risk-taking for the promise of reaping financial rewards for their inventions. That all changed in 2011 with the passage of the Leahy-Smith America Invents Act (AIA), which has since caused irreparable harm to the United States’ patent system and has stacked the deck against the little guy in favor of the Silicon Valley and other giants. Post grant reviews of issued patents existed prior to the AIA, but the AIA, through the creation of the Patent Trial and Appeal Board (PTAB) and the Inter Partes Review (IPR) created a post grant review process hostile towards patent owners. The lack of oversight, appointment of judges with apparent conflicts of interest, and allowing unlimited challenges to a single patent regardless of standing are just a few of the changes that placed a heavy hand on the scales of justice weighing in favor of Silicon Valley.
At the time, members of Congress said they were enacting legislation that would strengthen and streamline patent protection law, passing it by overwhelming majorities of 71% in the House and 95% in the Senate. However, eight years after its passage, the evidence clearly shows they have crippled the patent system.
This was never about streamlining the patent system—in fact, it has had the opposite effect. Instead of going into court to adjudicate an infringement case based upon the merits of the granted claims, the process is all about stalling, obfuscating, and forcing small companies to burn through their capital fighting a system that has been paid for by Silicon Valley. The AIA provided the legal mechanism for the Silicon Valley and others to destroy small companies and inventors, drain their limited resources and drive them out of business.
Small patent owners often engage in the futile effort of attempting to license their patents. Discussions with big tech companies are mostly fruitless and usually prove to be nothing more than a delay tactic by the infringer. The inventor is then forced to turn to the courts for enforcement and sues the unlicensed user of the technology. A lawsuit by the patent owner will usually trigger the IPR process. More often than not, the infringer will succeed in revoking all or part of the asserted patent. Even if the infringer fails in their efforts to cancel the patent, they will have succeeded in stalling as much as 18 months, costing the inventor precious capital, and knocking many out of business.
Leave Patents to the USPTO
Courts should never be tasked with dealing with the complexities of patent validity because they lack the necessary technical expertise. Patent validity issues such as sections 101, 102, 103, indefiniteness, and all other technical matters should be decided prior to a patent being issued by technically qualified examiners at the USPTO, not by the court. Once issued, a patent should only be challengeable at the USPTO, and only for a predetermined period, i.e. six months. The courts should only decide matters of infringement and damages.
No aspects of patent law should ever be subjective. Congress can fix the inconsistencies between the USPTO and the courts and put them on the same page by passing laws that clearly define patent validity guidelines, i.e. what is abstract. Life in the 21st century is dependent on computers. Consequently, many software-centric patents adding new inventive steps are being developed, only to be labeled abstract by the courts and invalidated. The lack of uniformity is responsible for nullifying valuable patents and strengthening the chokehold the Silicon Valley has on the necks of small inventors. Courts should only deal with infringement and damages based solely on clearly these defined guidelines.
Director Iancu has a very tough job ahead. He inherited a broken system, heavily biased against the little guy. Since taking the reins he has made positive changes and has shown his commitment to leveling the playing field for all inventors. He recently published revised 101 guidelines for his department that he hopes will lead to changes in how the Federal Circuit views eligibility under 101. To date, the courts have refused to apply the USPTO’s guidelines.
The current rigged system is killing innovation in the United States. In this time of special prosecutors, it is appropriate for one to be appointed to investigate exactly how we got here. There are many questions that need to be answered:
- What role did political contributions by Silicon Valley play in the passage of the AIA?
- How did Google get unprecedented influence over policymaking during Barack Obama’s administration? Why did Google and its affiliates, led by former Executive Eric Schmidt, log 437 official White House visits during the first 7 years of Barack Obama’s presidency?
- Did Google’s unfettered access to the Obama White House play a role in the subsequent dismissal of pending Antitrust litigation by the Federal Trade Commission (FTC) against Google?M
After spending the last 15 years dealing with patent issues, my advice to inventors and small companies is to not waste their time and money spinning their wheels in the current patent system. It takes too many years and often millions of dollars to secure a patent, only to have it taken away by a hostile IPR process. The USPTO has the most technically competent examiners in the world. These highly qualified experts in their field work diligently to issue quality patents, only to have their work erased by the PTAB and the courts. Despite their efforts, the value of the patents they carefully issue is often worth less than toilet paper. The AIA has reduced once valuable patent ownership into a fraudulent representation of what it used to signify.
Silicon Valley’s Lack of Vision
While the Silicon Valley conspires to steal intellectual property and stifle innovation, supported by the PTAB and the court system, China’s Shenzhen is emerging as a technical powerhouse; with plans to install 7,000 new 5G base stations this year alone. If the Silicon Valley continues their suppression of technological innovation, they will be displaced by Shenzhen as the hi-tech leaders of the world.
Overhauling the Current System
If the United States is to lead the world again in patent protection and innovation, the AIA must first be repealed and replaced with a set of laws that protect innovators and offers them the opportunity to profit from their inventions. The patent issuance process should be streamlined. It currently takes many years to issue a single patent, often followed by several years and potentially millions of dollars in post-grant defense costs. Reduce the issue time to one year and allow a six-month post-issue period for any challenges, which should all be handled by technical experts at the USPTO. The USPTO can fund these changes by increasing patent filing and issue fees. It is preferable for an inventor to spend $30,000 in fees for a patent’s issue within a reasonable amount of time than to get stuck in a process that takes years for issuance followed by more years and millions of dollars to defend.
The Important Question of Antitrust
Is Silicon Valley attempting to turn us into a corporatocracy through massive political contributions and their influence over policy making? Have they become too big and too controlling? Does the AIA rise to the level of fostering antitrust and anti-competitive practices described in the Sherman Anti-Trust Act (1890)? Did its passage by Congress and its eventual implementation violate any antitrust or anti-competitive laws? Was the AIA a collaboration between paid politicians, the Silicon Valley and the USPTO to stifle competition? Only a special prosecutor can answer these questions.
Some have made the case that the AIA has all the ingredients of antitrust. It has undoubtedly given the upper hand to the infringers and makes it nearly impossible for the small inventor to monetize their inventions and intellectual property. One thing is certain; if the AIA had been in place 40 years ago, the world would never have known Bill Gates, Steve Jobs, Michael Dell or Mark Zuckerberg. The tech giants of the time, IBM and Texas Instruments, would have used the PTAB to eliminate them in the same way Apple and Google do today.
It’s time to take a serious look at breaking up monopolistic corporations like Facebook, Google and Amazon. Facebook and Google, especially, control the flow of information in the United States and worldwide. They are restricting the free flow of ideas, news and opinions, and manipulate search engine and newsfeed results for their own purposes. With some obvious exceptions like child pornography, sex trafficking, drugs and harmful scams, they should not be the arbiters that decide which information people receive. They have to cease in being a political platform. Information should flow freely without going through a corporation’s biased filters.
Recently, Facebook co-founder Chris Hughes and Silicon Valley investor and former mentor to Mark Zuckerberg, Roger McNamee, have publicly called for the breakup of Facebook. In addition to Facebook, McNamee is also calling for the breakup of Google and Amazon, which he says have all undermined democracy, violated user privacy and gained monopoly power. The transformation of the U.S. patent system over the past decade is evidence of the harm caused when companies like these are allowed to monopolize their industries. These powerful providers of information have become “governments in waiting.” Capitalism only thrives when the rules encourage innovation and competition.
I am not making accusations. I am only hoping that we can dig deep and get to the bottom of what happened that caused the radical transformation of American patent law and injured so many inventors and stakeholders. We need the appointment of a special prosecutor to investigate these matters. Every day I wake up and work diligently to move Voip-Pal forward towards monetization. We are no stranger to the landmines which have been laid by the AIA, but we will keep battling until we succeed. As long as I am breathing, I will continue to fight for each of the more than 4,600 shareholders I represent. America will always be the greatest country for freedom and justice in the world.
Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of Voip-Pal.com Inc.
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