When it comes to the Patent Office, the US Needs a Serious Upgrade
Aug 3, 2013
Last week (July 25th) the House Judiciary Committee’s subcommittee on Courts, Intellectual Property and the Internet held a hearing on the importance of copyright for individuals and small businesses, this week the same subcommittee held a hearing on how technology plays an important role in innovating. For this panel there were five witnesses; Danae Ringelmann of Indiegogo, Jim Fruchterman of Benetech, Nathan Seidle of Sparkfun Electronics, Inc., Rakesh Agrawal of SnapStream Media, and Van Lindberg of Rackspace. Each of the witnesses brings a different industry and business model to the table, but despite those variations all of them come to agree on particular aspects of the current patent and IP protection system that need to be altered.
With the debate about patent trolls and the importance of protecting American IP abroad – through the free trade agreements that are currently being discussed – on the forefront of Congress and the President’s agenda, reaching an agreeable path forward is imperative. According to the witnesses, legislators and policymakers must strike a balance between protecting IP, while not encouraging Patent Assertion Entities (PAE) or stifling innovation. Consequently, there are a few major, basic overhauls to the current system that these witnesses expressed the system needs.
The first of which is a shorter, less expensive route when innovators or content creators are applying for copyrights, trademarks, or patents. According to Seidle, the speed at which technology is innovated and monetized is within weeks. However, the process by which to apply for and be granted a patent takes on average 2 to 4 years according to Lindberg. Consequently, the maximum potential for monetizing the patent is potentially lost while the inventor is waiting for the Patent Office’s approval. Similarly, and as made clear in the copyright hearing by witness, Sandra Aistars as well as the others, a more streamlined, even digital (web-based) copyright licensing engine would help increase the efficiency of the tedious task of requesting copyright. It would also minimize negative business consequences such as, a lost day of work to file for a copyright or a loss of royalties on a photograph or other copyrightable works because the barriers to do so were so great in terms of time and money.
Another criticism of the current patent system deals with non-fundamental patents. The nature of the patent system and those who are employed there means that there is a tendency for patents to be granted for overly broad or obvious ideas. Solutions to address this problem ought to deal with current and future patents. First, to deal with current bad patents content creators and the patent office ought to come together to help invalidate these overly broad patents. This is starting to happen with the website AskPatents, which is a collaboration of content creators concerned about patents and prior art. In order to help ensure that similar bad patents aren’t granted in the future the Patent Office should develop higher, more precise standards for those employees who actually grant inventors patents.
A third and final agreed on criticism, by the witnesses in the hearing, hits directly at the heart of patent trolls. Patent trolls are a drain on the R&D resources available to small businesses. According to Lindberg, his company has increased spending for litigations by 500% over the past three years, and has taken a defensive stance on patent trolls. However, not all small companies can afford to request and maintain a patent let alone bear the costs of litigation should they be targeted by a patent troll. While there were no specific policy prescriptions provided by the witnesses, they all agreed that tort reform is necessary.
Not discussed by the witnesses at the hearing, but one way in which small businesses are beginning to empower themselves against patent trolls is through a crowd-sourced database, trollingeffects.org. The database is set up to allow content creators the ability to look up cease-and-desist letters sent out by patents trolls. The intended purpose is to help individuals determine if their cease-and-desist letter or lawsuit notice is legitimate or not.
While Congress has a Constitutional obligation to protect IP rights, they also have an obligation to their constituents to do so in the most effective way possible. Consequently, as Congress moves forward on the issue of patent trolls and intellectual property, it is important to remember that it is not Congress’s job to select winners and losers based on business models, but to encourage and protect innovation at all levels and by all content creators. Therefore, there is a lot to bear in mind when going forward with patent reform.