
Federal Circuit Should Not Allow Patents on Inventions That Belong to the Public - DiabloD3
https://www.eff.org/deeplinks/2018/02/federal-circuit-should-not-allow-patents-inventions-should-belong-public
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JonnyNova
It always bugs the hell out of me that many large organizations will file for
patents that they have no intent of developing. I worked at a certain large
corporation previously and they would have patent brain storming camps
encouraging various employees to think of and file for patents on just about
any topic regardless of the business's involvement in that field. A large
majority of patents that come out of those workshops either stifle innovation
in that area completely or are used to later extort someone who wishes to
actually bring it to market.

~~~
dctoedt
> _patent brain storming camps encouraging various employees to think of and
> file for patents on just about any topic regardless of the business 's
> involvement in that field_

One principal reason is to establish a defensive portfolio, for possible use
in counterattacking and as currency in future cross-licensing negotiations. If
(let's say) IBM were to threaten sue XYZ Corporation for infringement [0],
then XYZ would look through its own portfolio of patents to see which patents
the company could use to assert a counterclaim against IBM; if XYZ didn't own
any patents, it'd have nothing to trade. [1] It's commonly believed that this
is why Microsoft went on a patenting binge in the 1990s: so that it would have
something with which to counterattack and trade cross-licenses if, say, IBM
sued it for infringement. EDIT: This was documented in a 1991 Bill Gates memo
[2].

[0] In the early days of the PC, a certain large computer company had a
reputation for (figuratively) dropping two or three stacks of patents on
another company's desk and saying, _you can have a license to Stack A for X%
of your revenue, a license to Stacks A and B for X+Y% of your revenue, and a
license to all three stacks for X+Y+Z% of your revenue._ The other company
would ask, _which ones do you think we infringe?_ The larger company would
answer, _oh, we have no idea, but now that you know about these patents, if
you do infringe, we 'll find out eventually, you'll be a willful infringer,
and you'll owe us up to treble damages._ Some companies decided that settling
was the better part of valor.

[1]
[https://scholarship.law.berkeley.edu/cgi/viewcontent.cgi?art...](https://scholarship.law.berkeley.edu/cgi/viewcontent.cgi?article=2074&context=btlj)

[2] [https://arstechnica.com/information-
technology/2007/03/analy...](https://arstechnica.com/information-
technology/2007/03/analysis-microsofts-software-patent-flip-flop/)

~~~
aplorbust
To finish the story with some original thought, lets ask why this tactic
works.

Perhaps it works because of the expense of determining which patent claims
could realistically survive a motion to dismiss, i.e., the hourly rate of the
patent lawyers hired to do this analysis and the number of hours they take to
do it. The larger the stack of _potentially_ assertable claims that need to be
considered, the greater the cost. Quantity not quality.

If that process of determination, separating wheat from chaff, filtering out
all the nonassertable (junk) claims, was less expensive than simply paying for
a licenseFN1, then perhaps this tactic would not work.

FN1. Use imagination if believe this is impossible to achieve.

~~~
dctoedt
That's correct; many patent claims are written in long, dense paragraphs,
without line breaks, subdivision numbers, or other "signposts" to guide the
reader. I'm convinced that often this is often more than just laziness or
incompetence by the patent attorney — it's intentional obscurantism, to make
it more difficult and expensive for others to determine whether or not they
infringe and whether or not the claim is in fact legally patentable. [3]

[3] [http://www.oncontracts.com/multi-sentence-
claims/](http://www.oncontracts.com/multi-sentence-claims/) (self-cite)

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amelius
One big problem with patents is that they are often filed for technologies
developed by universities and government institutions (e.g. paid by the tax
payer), where just the last missing piece of the puzzle is actually
patentable.

I'd say we introduce a challenge period. If someone wants a patent, they
should pose a challenge for anyone to come up with a solution. If nobody comes
up with a solution in the given period, then they can have the patent.

This would work perfectly for stupid software patents.

~~~
ABCLAW
The larger issue is how do we get universities incentives to produce practical
innovation.

Currently, there are a number of different institutional frameworks for trying
to deal with the issue. Most of them don't work well. We have university
patents + tech transfer offices. We have obligated NIH patent holding +
licensing available to third parties for NIH sponsored innovations. We have
government funded 'incubator'-like institutions with wide or narrow research
scopes, etc.

Patents overall are an attempt at a solution for a larger problem - how do we
allocate rewards to innovators. Our main model for doing so, academically, is
to try and fail to create transparent funding flows to finance enlightenment-
style aristocratic researchers (with labs, equipment, staff, etc). We do this
in a manner that avoids accusations that they are receiving privileged
patronage while also paying lip service to the idea that free-riders, extra-
territorial or not, should contribute to the effort.

But note that we're trying to do different things with this one tool - and
attempts to fix it in one area often result in breaking it in another. The
entire system is just kludge upon kludge because of this.

~~~
BraveNewCurency
> how do we allocate rewards to innovators

The goal of the patent system is not to "pay innovators" \- they already get
paid by putting good products on the market.

The goal of the patent system is to get innovators to PUBLISH their solutions
so that the public can benefit from them. (And build on them in the future.)

If the patent is obvious, then the public gets no benefit, and we're handing
out monopolies for free.

~~~
ABCLAW
This is a VERY interesting reply, because it showcases so much.

Having innovators publish isn't, big picture, important. The big picture
importance is getting people to actually use the fruits of research in society
where that would be optimal. Publication is a tiny element of making that
happen, by facilitating tech transfer (but not really, because a huge chunk of
patented innovations can't be replicated from the filed documents or published
research papers. Intentionally.).

So why is publication treated as the aim? Because the rewards associated with
innovation are best secured by secrecy in the absence of other anti-free-rider
measures. Hence secrecy is replaced as the source of reward for innovators
because secrecy is directly at odds with the social desire to implement
superior tech or processes.

Your refrain is a common one used by patent maximalists to describe patents as
a transaction between the public and the innovator, rather than a grant of
privilege. This is because if we divorce patents from their actual social
utility, and instead focus on their immediate results, we can ignore their
externalities and create a self-fullfilling positive KPI to talk about ("Hey
look, we published n innovations in public! More than last year!" vs. "On a
Net basis, we've bettered things in society.")

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kfriede
I wonder how this would effectively play out. How much market research will be
deemed acceptable to accurately say that something hasn't been invented yet?
Can Joe Dirt sue a company a year after their patent filing, saying he posted
the idea on his Twitter before they filed?

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virtuowl
I always feel that patents or at least the way patents work is really bad for
humanity as a whole and hindering our progress. On the other hand there has to
be some way for inventors to benefit, are there any good alternatives?

~~~
rayiner
Have you ever worked in a field where patents are an important part of the
market structure? Telecom, pharma, etc.?

I spent my engineering career in telecom, and patents are a key part of the
model. Those industries don't have the equivalent of a Google or an Apple that
can bankroll expensive R&D on the back of massive consumer revenue. They're no
unicorns or network effects where you can take a 20% cut on every app that
gets sold to your captive user base. Instead, companies pay teams of very
expensive PhDs to develop things like error correction systems for modems.
They patent those things, use the patents to either extract licensing revenue
or, more importantly, keep out free riders who didn't contribute to developing
the technology. Then it's all obsolete in five years and they do it all over
again.

Markets are good, and patents, as imperfect as they are, provide an
infrastructure for integrating expensive R&D efforts (which don't result in
tangible property), into markets, in a way that avoids free-riding. And it
also results in market structures that are sane. I can just go buy a Broadcom
Wi-Fi chip. Broadcom can recoup its investment by just selling me a chip, and
count on patents to keep out free-riders. Their business model doesn't require
them to make a whole consumer end-product like a phone, or tie their hardware
to advertising, to be viable.

In the absence of patents, you get trade secrets and vertical integration.
Apple doesn't care about patents because it doesn't sell you chip designs or
even a chip, it sells you an iPhone. Google doesn't care about patents because
it doesn't sell VP9 or Blink--those are just a means for furthering its
advertising business.

Take a step back and think about the business models you want to see more of.
Do we need more Apples and Samsungs, which want to sell you a complete end-
user product tied to their ecosystem? Or do we want more ARMs, which are happy
to just sell you a chip or even an IP core? Wouldn't it be nice to bring back
Netscape? Where you could just exchange money for a web browser, instead of
going to google.com and it bugging you to download Google's web browser for
"free?"

~~~
monocasa
> Those industries don't have the equivalent of a Google or an Apple that can
> bankroll expensive R&D on the back of massive consumer revenue

What are you talking about? The biggest players in the telecom market report
some of the largest profit in the country, both in real terms and as a
percentage of revenue. They're just so entrenched that they view any R&D as a
cost center if they can't use it to keep others or of the market.

~~~
rayiner
If you look at a pure telecom company like Verizon, they're at $13.6 billion
in profits (for 2017) on $125 billion in revenue. Apple is at $50 billion in
profits on $229 billion in revenue (for 2017). So Apple's margin is almost
double.

Also, "consumer revenue" is the key word. The biggest R&D players in telecom
don't sell to consumers. Intel and Qualcomm sell chips (and ARM just sells you
IP). They don't make the chip in house and sell you a complete phone. At the
same time, a company like Verizon or Comcast that sells to consumers isn't
vertically integrated and doesn't do its own R&D. They buy all their equipment
from other companies that do the R&D. You don't have vertically-integrated
company that uses consumer revenue to bankroll the R&D. You have
specialization and market transactions mediated by, among other things,
patents.

Contrast web technology, where there’s no patents and no markets. Nobody sells
browser engines. There is no specialization. It’s all driven by Apple,
Microsoft, and Google, who invest in the R&D to further their consumer-facing
platforms.

~~~
monocasa
Verizon (and most telecoms for that matter) plays games by being hundreds if
not thousands of tiny partnerships, which obfuscates their profit.

~~~
rayiner
Verizon is a holding company. It's structured as a holding company with
numerous subsidiaries because it's got physical property all over the country,
and is subject to literally thousands of different regulatory regimes:
federal, 50 states, thousands of city and county utility boards. But its
profit figures are reported on a consolidated basis. (And if you have hard
evidence to the contrary, man do you have a valuable lawsuit on your hands.)

~~~
monocasa
It's setup in slightly different ways for different niches in the market, but
on the mobile side it's a holdover from original FCC regulations on how
ownership of spectrum worked. The FCC wanted to encourage competition, so they
heavily emphasized partnerships with little mom and pops for each local region
of spectrum. After the FCC removed those regulation requirements, those
partnerships were still useful as sort of bellows of profit so that the C
level can manage their growth curve.

This is all not really private information, is how pretty much all of the
telecoms are structured, and isn't illegal.

~~~
rayiner
Is profit from those partnerships not being reported as income to the holding
company?

~~~
monocasa
Not the other 30% or 49% or what have you that's not owned by the national
company. But the nature of how the national company handles so many services
for the partnerships means that 'negotiations' can change how the money flows
around year after year in a way thats controlled by the national company (I
say national company because they really are more than just holding companies,
they handle large pieces of the business as well).

~~~
rayiner
The profit that accrues to those partnerships either never gets back to
Verizon (in which case how is it relevant?) or simply "bellows" (as you put
it) the cash flow to Verizon. In the latter case, it'll still show up in long-
term measurements. But at the end of the day, Verizon's 5-year profit margin
is 13% while AT&T's is 11%. That's about the same as Starbucks. Google and
Apple are at 20%+, and Facebook is at 28%.

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md2be
Eff might be wrong on this one, The problem with the provisional: is it
apparently does not fully support any of the claims pending in the Fan
application as published. That is, the invention as claimed was NOT in the
public domain.

