Senate’s Patent Act is a Big Win for Startups(engine.is)
engine.is
Senate’s Patent Act is a Big Win for Startups
http://engine.is/issues/ip/senates-patent-act-is-a-big-win-for-startups/5303
4 comments
For those who want to improve patent quality, let the patent office keep its funds so it can invest in updated technology and hiring and training patent examiners. Currently, those applying for patents pay fees to the patent office, but congress takes most of the money for other stuff (e.g., pet projects in their districts). Let the patent office keep its funds paid for by patent applicants, so they can be re-invested in the system.
Looks like at least for the last few years, the patent office has spent approximately the amount it takes in as fees:
"estimated base fee collections for 2016 of $3.207 billion. This forecasted amount of fee collection revenue continues a trend of year over year increases in fee collections from the 2015 estimate ($3.142 billion) and the actual 2014 collections ($3.024 billion). The total budgeted program level for the USPTO during the 2016 fiscal year has also been growing incrementally year over year. The total estimated obligations of the PTO for 2016 are $3.499 billion, over $150 million more than 2015’s estimated obligations ($3.331 billion) and about $500 more than actual 2014 obligations ($2.997 billion)." http://www.ipwatchdog.com/2015/02/05/usptos-budget-increases...
"estimated base fee collections for 2016 of $3.207 billion. This forecasted amount of fee collection revenue continues a trend of year over year increases in fee collections from the 2015 estimate ($3.142 billion) and the actual 2014 collections ($3.024 billion). The total budgeted program level for the USPTO during the 2016 fiscal year has also been growing incrementally year over year. The total estimated obligations of the PTO for 2016 are $3.499 billion, over $150 million more than 2015’s estimated obligations ($3.331 billion) and about $500 more than actual 2014 obligations ($2.997 billion)." http://www.ipwatchdog.com/2015/02/05/usptos-budget-increases...
@kbutler
Agreed. That Web site has a good understanding of the patent system (unlike, e.g., in general, writers for the NYT and WSJ). The article appears to state, however, that the patent office is working from reserves to make up for current shortfalls. Another issue is that while patent laws passed by congress often include sections that appear to stop congress from taking money from the patent office, they always leave a back door in the legislation to allow for the taking in the future.
That would create a corrupting incentive for the USPTO to encourage and accept more patent filings, which is the opposite of what they should be doing.
@omelet.
Also, many feel that the patent office is currently incentivized to allow low quality applications to issue as low quality patents, because the patent office does not have the resources (i.e., people and computer search tools) to do a proper search and analysis of the incoming patent applications.
@omellet
You make an interesting point. The patent office doesn't really encourage the filing of patent applications though. Instead, it examines patent applications after they are filed.
Their point is that the Patent Office would have a "perverse incentive" to encourage/increase the number of filings and the numbers of patents it grants if the Office were allowed to keep the proceeds raised from fees, which you correctly point out is not the case right now.
@wavefunction.
I see their point, but I don't quite follow their logic. I don't think the patent office has much control over how many people file patent applications, they just examine them once they are filed. For example, the patent office doesn't advertise during the superbowl. If they have less resources to examine the filed patent applications, then they will not be able to examine them as effectively.
Something similar happens to the SEC. IIRC from memory, around the mid-2000's, the SEC took in circa 600 million in fees, while Congress budgeted it circa 100 million.
For years, the SEC was/is clamoring to hire more and more qualified examiners. This budgeting has cut these proposals/initiatives off at the knees.
A few years ago, it was announced that they would be creating... again, IIRC, roughly 1000 of these positions. One of the "significant" announcements/initiatives following the 2008 financial crisis. The last I heard, a couple of years ago, this initiative was still stalled, due to... no allocated budget.
In understanding regulation (and IP as well is "regulation", of a sort), in addition to all the "politics", it is merited to apply that old but apt saw, "follow the money".
For years, the SEC was/is clamoring to hire more and more qualified examiners. This budgeting has cut these proposals/initiatives off at the knees.
A few years ago, it was announced that they would be creating... again, IIRC, roughly 1000 of these positions. One of the "significant" announcements/initiatives following the 2008 financial crisis. The last I heard, a couple of years ago, this initiative was still stalled, due to... no allocated budget.
In understanding regulation (and IP as well is "regulation", of a sort), in addition to all the "politics", it is merited to apply that old but apt saw, "follow the money".
It's marginally better for startups. Something that would be a big-win is the nullification of the entire idea of software patents.
@jgmmo
You raise an interesting question about software patents.
Many people think that physical hardware devices, like an improved portable GPS device for my car, or a police radar gun, should be patent eligible. Many of those same people think that an app that performs the same functions in a mobile device should not be patent eligible. It could be argued, however, that in these cases, the hardware and software are really implementations of the same "invention."
I only stopped at software due to the audience. I personally am not sure I believe the idea of intellectual property is defensible, at all.
It's hard for me to imagine why someone, somewhere, should be allowed to dictate how I am or am not allowed to use my resources just because 'they thought of it first'. Especially since I am of the belief that there is no original thought.
“There is no such thing as a new idea. It is impossible. We simply take a lot of old ideas and put them into a sort of mental kaleidoscope. We give them a turn and they make new and curious combinations. We keep on turning and making new combinations indefinitely; but they are the same old pieces of colored glass that have been in use through all the ages.” ― Mark Twain
It's hard for me to imagine why someone, somewhere, should be allowed to dictate how I am or am not allowed to use my resources just because 'they thought of it first'. Especially since I am of the belief that there is no original thought.
“There is no such thing as a new idea. It is impossible. We simply take a lot of old ideas and put them into a sort of mental kaleidoscope. We give them a turn and they make new and curious combinations. We keep on turning and making new combinations indefinitely; but they are the same old pieces of colored glass that have been in use through all the ages.” ― Mark Twain
Its entirely to encourage innovation. A commerce thing. If you improve a pump, and try to sell it, and BigPumpsCo instantly copies the better design, then what motivation to make better pumps?
The term for a patent is 20 years, according to my limited understanding. That's an enormous amount of time to be able to legally have a monopoly on something like 'playing video on the internet', 'in-app purchasing', etc.
Do you think when a company owns a process like that, for 20 years, that it improves innovation?
Do you think when a company owns a process like that, for 20 years, that it improves innovation?
I'll never understand how low quality patents even pass, and how they can be valid in court.
They pass because the patent application process goes like this.
Here are my VERY broad patent that claims X and Y.
USPTO: You are denied because this prior art A discloses X and Y.
Applicant: OK, here is my amended claim: X, Y and Z!
USPTO: But prior art A combined with B shows X, Y and Z, and its obvious to combined A and B.
Applicant: No it's not obvious but still they don't show X, Y, Z, and W.
USPTO: Okay A and B don't show that here is your patent.
The issue is that when you get so far down the argument the examiner gets sort of tunnel vision. They never spend a lot of time to see if a new reference they had not yet found showed X, Y, Z, and W.
Worse, sometimes things like W are obscure and wouldn't normally be mention in prior art. The argument then becomes, "okay this DRM server was disclosed in prior art, BUT my DRM server includes a memory caching process to reduce loading times for common files."
If you aren't super familiar with servers, it might not be apparent that all servers have something like that, or if they don't, it's obvious. Even if you are, you'll almost never find something like that explicitly spelled out in a previous patent. So they get the patent.
This actually wouldn't be a problem if patent trolls didn't exist. It is more efficient to deep test a patent only after it is used. The vast bulk of all patents are never used.
Here are my VERY broad patent that claims X and Y.
USPTO: You are denied because this prior art A discloses X and Y.
Applicant: OK, here is my amended claim: X, Y and Z!
USPTO: But prior art A combined with B shows X, Y and Z, and its obvious to combined A and B.
Applicant: No it's not obvious but still they don't show X, Y, Z, and W.
USPTO: Okay A and B don't show that here is your patent.
The issue is that when you get so far down the argument the examiner gets sort of tunnel vision. They never spend a lot of time to see if a new reference they had not yet found showed X, Y, Z, and W.
Worse, sometimes things like W are obscure and wouldn't normally be mention in prior art. The argument then becomes, "okay this DRM server was disclosed in prior art, BUT my DRM server includes a memory caching process to reduce loading times for common files."
If you aren't super familiar with servers, it might not be apparent that all servers have something like that, or if they don't, it's obvious. Even if you are, you'll almost never find something like that explicitly spelled out in a previous patent. So they get the patent.
This actually wouldn't be a problem if patent trolls didn't exist. It is more efficient to deep test a patent only after it is used. The vast bulk of all patents are never used.
@jokoon
The low quality patents are typically not found to be valid in court. The problem is, a founder does not want to spend the money and (most importantly) time to go to court. He/she wants to work on the startup.
Also, some patents are strong, and some are of low quality. The low quality patents exist, in part, because the patent office does not have the resources (i.e., enough personnel, training and search technology) to perform a proper analysis. Those resources are lacking because congress takes funds from the patent office (the patent office could be otherwise self funded if not for congress taking the funds to use for their pet projects).
Also, some patents are strong, and some are of low quality. The low quality patents exist, in part, because the patent office does not have the resources (i.e., enough personnel, training and search technology) to perform a proper analysis. Those resources are lacking because congress takes funds from the patent office (the patent office could be otherwise self funded if not for congress taking the funds to use for their pet projects).
I think part of the bad patent problem is that at certain points in time the patent office's backlog of unexamined patents had gotten so long they had to relax their review standards somewhat just because they didn't have enough reviewers for the volume of patents they needed to review.
@elihu
Many people would agree with that point.
Url changed from http://avc.com/2015/05/the-patent-act/, which points to this.