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Wednesday, March 22, 2006

Patent Trolls are Not the Problem

This commentary from the Wall Street Journal continues the discussion in What's Wrong with Our Patent System? While there are differences in the two editorial's diagnosis of the problems with the patent system, e.g. on the importance of patent trolls in contributing to the problem, an area of agreement is that too many patents are granted and many of them are of questionable validity. A suggested solution in both cases is to increase the number of experts in the patent office, and to allow competitors the opportunity to weigh in earlier in the patent review process. In both cases the goal is the same, to reduce problems by reducing the number of bad patents that are granted:

War on 'Patent Trolls' May Be Wrong Battle, by Alan Murray, Commentary, WSJ:  In the business world, the new villains are "patent trolls." The term was coined five years ago by Peter Detkin, then head of litigation for Intel Corp., to vilify companies "that try to make a lot of money off a patent that they are not practicing and have no intention of practicing and in most cases never practiced." The trolls earned their place in the public imagination thanks to NTP Inc., whose patent lawsuit threatened ... to interrupt service to about three million BlackBerry users until it was settled this month...

Next week, the titans of technology take their antitroll crusade to Washington. On March 29, the Supreme Court will hear arguments in a case involving ... eBay Inc. ...[and] a company called MercExchange LLC, which claims to own the patent on eBay's popular "Buy It Now" process. Touted as the most important patent case to hit the U.S. high court in a decade, this one revolves around whether companies like MercExchange and NTP should be granted injunctions to shut down patent infringers. The following week, Congress ... plans hearings ... to look at, among other things, the BlackBerry fiasco and the role of trolls.

But patent trolls are getting a bad rap. For one thing, most U.S. research universities fit Mr. Detkin's definition cited above. Does anyone think Stanford University deserves less patent protection than, say, Microsoft, because it doesn't make or sell products? ... [F]ormer Microsoft chief technologist Nathan Myhrvold, ... an outcast among his tech colleagues on this topic, argues there is no reason a company should be given less protection ... simply because it chooses not to commercialize its patents. After all, Thomas Edison, who nabbed more than 1,000 patents, didn't manufacture his inventions. ... At a time when the U.S. advantage in global trade is its intellectual property, weakening patent protection ... would be a big mistake.

There is a problem in the patent world, but it isn't companies that don't commercialize their own patents. Rather, it is bad patents. These days, too many are granted, too often for "inventions" that seem to the initiated to be as obvious as air... In part, that happens because the Patent and Trademark Office is understaffed and overwhelmed. A good first step would be to beef up the patent agency. .... Second, change the patent laws to allow opponents of new patents to weigh in earlier. Right now, examiners often work in a vacuum. If patent applications were published prior to final approval and allowed to be contested ... fewer bad patents might be issued... [Update: A NY Times editorial echoes the theme.]

    Posted by on Wednesday, March 22, 2006 at 12:51 AM in Economics, Policy, Regulation, Technology | Permalink  TrackBack (0)  Comments (12)

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