
In new case, Supreme Court revisits the question of software patents - pge
http://m.washingtonpost.com/business/in-new-case-supreme-court-revisits-the-question-of-software-patents/2014/03/28/a3da1c52-ad3a-11e3-9627-c65021d6d572_story.html
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PythonicAlpha
Big companies always claim, that make the IP (so called "intellectual
property") rights stronger does strengthen the innovators. The opposite is
true!

When old (and stupid) patents hinder innovation (what happens all day today),
than the patent system becomes the biggest hindrance to innovation. Somebody
said about IP: When it is better to "own" old IP than to make new one, the
system is strangling innovation, nothing else. We already at this point (and
it was fostered by the owning people).

Patents once where made up, to bring inventors an incentive to share their
inventions with the others. But this "sharing" brings only benefits to the
society, when the inventions bring any knowledge gain to the community.

Software patents are the worst: Most of them include trivial things that do
not bring any new knowledge to the industry, but are blocking other inventors.
Good example is Amazons One-click patent (but this is only one of maybe
thousands examples): What is the knowledge gain of the world, by having this
patent?

 _This system is for the "owners" not for the "creators"!_

~~~
sweeney2014
If you count history as starting recently, then sure. However, the patents
came AFTER the refining of an idea to concrete steps which came AFTER the
funding to refine the idea which came AFTER the guy/gal with the idea finding
funding to refine the idea.

One thing investors fear is investing in small unknown people where once the
secret sauce is visible, it can be easily copied. In particular, copied by
large corporations with customer channels, marketing muscle, deployed software
installations with patch/upgrade cycles, etc... Investors often look at
barriers to entry which patents happen to provide.

~~~
PythonicAlpha
The problem is only, that patents happen to protect the big companies more
often than any small company.

There was once a company, it got visited by the lawyers of a big corporation.

They claimed that this company violated patent X of the corporation and they
wanted Y millions for it. The smaller company proofed that they did not
violate this specific patent.

The lawyers just said, that their corporation owned X thousands of patents and
many, many lawyers worked for it. If they go empty today, they will search and
find 10 patents that where violated by the smaller company.

Tell what, the smaller company paid.

It might be, that to own some patents is good and to ask for it is reasonable
for investors. But with the view on the nationwide or world-wide economics,
patents are essential bad.

I once also heard (I am not so good in this history, so sorry I can not give
details), that the US economy and inventions had so a quick rise, one reason
was because they at first abandoned the patent system of the UK and did not
care about the patents in the "old world".

~~~
sweeney2014
That example is not an isolated incident and happens far too often. It has
been part of the large corporations game plan for years now. They have found
ways of using the patent system to attack small entities AND have used their
deep pockets to drag out justice for the small entity.

Patent reform should focus on helping small and independent innovators, when
in reality it is being driven by large deep-pocketed corporations.

~~~
PythonicAlpha
>Patent reform should focus on helping small and independent innovators, when
in reality it is being driven by large deep-pocketed corporations.

That is right. I am also wondering all the time about the focus of patent
reforms: so called patent-trolls. But as annoying they might be, the whole
case looks very much like a diversionary tactic to distract from the real
problems of the system.

~~~
sweeney2014
Not quite. Those so called patent trolls are the thorn in the side of the
large corporations. Even after a small entity succeeds in obtaining a patent
and has their innovation copied by a large corporation and opens a dialogue
with the large corporation, he/she is shunned and told to get lost. One large
corporation (Apple) is at least honest about it and tells the small entity we
can't take you seriously until you initiate a patent infringement suit [1].
The reason is rather simple: it is their most cost effective way of weeding
out those they do need to worry about from those they can ignore.

[1] [http://www.ipwatchdog.com/2013/05/01/is-patent-litigation-
re...](http://www.ipwatchdog.com/2013/05/01/is-patent-litigation-really-a-
problem-for-big-tech/id=39325/)

~~~
PythonicAlpha
And it is also a convenient way to hold smaller companies with good ideas but
smaller pockets at bay.

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rayiner
To be precise, the case isn't about software patents. Its about whether taking
an unpatentable business method (per Bilski) and implementing it on a general
purpose computer makes it patentable. The answer will likely be no, but that
won't invalidate software patents. The appellant wants to make it seem that
way, "if you deny our patent it will invalidate all software patents," but
thats not the best characterization. What will happen instead is that the
Supreme Court will distinguish software patents generally from the patent at
issue in this case. What will be interesting, in my opinion, is how they draw
the distinction.

The "abstract idea" line drawing is complicated from both sides, however. Say
you develop a clever algorithm for doing transmission power control for a WiFi
radio. If you implement it on an ASIC, that's almost certainly patentable. But
what about an FPGA? Or a general purpose processor? If software patents are
categorically invalid, you end up being able to patent things in ASICs that
can't be patented if done on a GPP. If they are valid, that doesn't help when
someone tries to patent something like a mechanism for hedging risk.

I think the real issue is looking at whether the algorithm embodied in a
patent is a general concept, or a narrow domain specific design. In other
words, you shouldn't be able to patent the concept of transmission power
control. But you should be able to patent a specific method for doing
transmission power control they arises out of capital intensive research.

~~~
bane
> Its about whether taking an unpatentable business method (per Bilski) and
> implementing it on a general purpose computer makes it patentable.

TBH, I'm not terribly familiar with what can and can't be patented as per
business methods. But technically all things that can be computed, can be
computed by enough people doing the arithmetic. Computers just make this much
faster.

So if I have 300 people...I dunno, collating wedding invitations, and come up
with a way of doing it in software, that's not patentable?

However, a clever algorithm for computational imaging is arguable patentable,
but anybody who knows matrix math can probably do it manually.

So is it really a discussion over the magnitude of the assist to humans doing
the grinding computations by hand and where that line is drawn? Or to your
example, some software running on a general purpose CPU can often be
implemented as DSPs or some other specialized hardware, it's obviously no
longer software I suppose once it's a DSP, even if the method for doing the
computation is the same.

~~~
rayiner
I mean, your examples really capture the debate at issue in the case. Trying
to draw lines based on whether the idea is implemented in software or hardware
is just arbitrary.

The real question is: what sort of algorithms do we want people to be able to
patent? This is an economic question, not a legal one. At what point does the
benefit from disallowing free riding out weigh the cost of granting the
temporary monopoly? The problem with the law is that it sidesteps this
question. Its based on an 19th century notion of invention, whereas the real
value of patents is protecting investment into R&D.

~~~
bane
Right. And I think that's a useful consideration to use. I've worked on some
algorithms in the past that were the result of a few million dollars in R&D.
We decided not to patent because of the gray areas involved, but instead kept
the algorithms protected by distributing only compiled code (as is pretty
common in industry). But good solid protection for that kind of investment
would be a useful thing to have even if it's a software patent.

One-click shopping? I believe there was lots of effort put into engineering
it, but not so much on the R&D side.

Is a patent examiner qualified to implement whatever decision is made on where
that line is? I think it's still going to remain a minefield for a very long
time.

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microcolonel
Well, if this is serious(I hope it's not just more bad journalism from the
washington post), I'd be very happy to see software patent go off the table.
It would mean I could finally stop worrying about submarine patents on
software, and get back to actually making good software.

~~~
adestefan
If you were a mechanical engineer whose specialty was developing new fasteners
would you say the same thing about patents on fasteners?

------
panabee
i wrote a blog post on this, but i believe crowdfunding, assuming regulation
and government policy don't interfere, will accelerate the demise of patents,
especially software patents. the purpose of patents is to foster innovation,
but they arguably seem to have the opposite effect today.

effectively, patents protect the two constituent groups required for
innovation: (1) creators and (2) investors.

music, art, film, restaurants, and mobile apps demonstrate that patents are
not necessary for people to invent (though some IP like copyright seems
mandatory). in some fields, the joy of creation and the promise of financial
gain, even if unprotected and unsustainable, is sufficient motivation for
invention.

the common thread, of course, is capital efficiency. it's far easier to risk
investment and innovation when little money is required. investors are needed
for innovation in capital intensive areas, but investors historically have
been ROI motivated and sought assurances, such as patents, that their money
will yield a return.

crowdfunding enables creators to break from ROI-investors and find financing
from a different set of people: those who want not a ROI, but a specific
product or service. most importantly, these "investors" care less about
patents or the long-term viability of a company. they just want a
product/service to exist -- from anyone.

we're already seeing this unfold on kickstarter and indiegogo. the question is
whether lobbyists and governments cripple crowdfunding, or allow it to reach
its maximum potential.

if people will innovate, regardless of patents, and other people will
underwrite products, regardless of patents, why do we need patents to foster
innovation?

~~~
rayiner
The purpose of patents isn't to incentivize innovation. Its to protect capital
intensive R&D from the free rider effect and to allow the fruits of R&D to be
the subject of transactions. Crowd funding in this context is a joke. Wake me
up when someone crowd funds a blockbuster anti-cancer drug or disease
resistant crop. We're talking capital investments that start with a 'b'.
Nobody is going to fund that if the results can be easily copied (eliminating
ROI), whether we're talking about traditional investors or crowd funders.

A great example is the Spaceship One patents. The arrangement there was that
Scaled Composites would do the R&D, and Paul Allen would invest, and companies
like Virgin would commercialize. Having a property right that can be the
subject of transactions is tremendously valuable for these sorts of
arrangements.

~~~
dctoedt
> _The purpose of patents isn 't to incentivize innovation._

That's directly contrary to the text of the U.S. Constitution, article I,
section 8, clause 8, which gives Congress the power: " _To promote the
Progress of Science and useful Arts, by securing for limited Times to Authors
and Inventors the exclusive Right to their respective Writings and
Discoveries._ "

The Supreme Court's canonical explanation of patents' constitutional purpose
was written by Justice Clark, for a unanimous Court, in _Graham v. John Deere
Co. of Kansas City_ , 366 U.S. 1 (1966): [1]

==BEGIN QUOTE==

... The clause is both a grant of power and a limitation. This qualified
authority, unlike the power often exercised in the sixteenth and seventeenth
centuries by the English Crown, is limited to the promotion of advances in the
"useful arts." It was written against the backdrop of the practices—eventually
curtailed by the Statute of Monopolies—of the Crown in granting monopolies to
court favorites in goods or businesses which had long before been enjoyed by
the public. See Meinhardt, Inventions, Patents and Monopoly, pp. 30-35
(London, 1946).

The Congress in the exercise of the patent power may not overreach the
restraints imposed by the stated constitutional purpose.

Nor may it enlarge the patent monopoly without regard to the innovation,
advancement or social benefit gained thereby.

Moreover, Congress may not authorize the issuance of patents whose effects are
to remove existent knowledge from the public domain, or to restrict free
access to materials already available.

Innovation, advancement, and things which add to the sum of useful knowledge
are inherent requisites in a patent system which by constitutional command
must "promote the Progress of . . . useful Arts."

This is the _standard_ expressed in the Constitution and it may not be
ignored. ...

==END QUOTE==

 _Id._ at 5-6 (emphasis in original, extra paragraphing added.)

As 'wnoise correctly points out down-thread, protecting capital-intensive R&D
from free riders is not an end in itself, but merely a means for achieving
that end.

[1]
[http://scholar.google.com/scholar_case?case=9105652591497305...](http://scholar.google.com/scholar_case?case=9105652591497305710).
The decision was 7-0; two justices (Stewart and Fortas) took no part, which
usually means they recused themselves because of conflicts of interest such as
personal business investments in one of the parties.

~~~
rayiner
You're right that's the stated purpose of patents. But that rationale arose
before we had a solid understanding of modern economics. I'm talking about the
rationale for patents in that context. Its prevention of free riding. Just as
Posner would say the purpose of the tort system is to shift the cost of
exercising care to the party that can bear it at least cost, or the purpose of
environmental laws is to internalize negative externalities, etc.

~~~
dctoedt
Point taken -- maybe a better phrasing would be that the purpose of the patent
system is to try to mitigate _dis_ incentives to innovation, viz., the free-
rider problem.

------
SchizoDuckie
Please oh please United States, come to your senses for once. Sincerely, The
Rest Of The World.

~~~
SeanLuke
Does "the rest of the world" include Britain, Japan, and South Korea?

------
yp_master
True or false? A patent is a government-granted right to sue. A patent grants
a license to produce the invention. A patent grants a "monopoly"; success is
court when suing challengers is "guaranteed".

~~~
yp_master
Here are the answers:

    
    
      T
      F
      F
    

FWIW, IAAAL.

I suspect not many readers understand the above facts.

If you purchase a US patent, this is what you get: a right to sue.

Nothing more and nothing less.

If you have any doubts that the above is true, ask your lawyer.

Knowing exactly what a patent is should make you think more carefully about
what a patent may or may not "incentivize".

