Post by Elliot Nahman and Curtis Hwang
Many patents, still pending: Congress tweaks, but does not overhaul, America’s patent system
http://www.economist.com/node/21528643
Overview and relevance to Patent Law reading
Barack Obama has recently signed into law significant new patent reform called the America Invents Act. The most significant of the new reform is the way patents are awarded from ‘first to invent’ to ‘first to file’, which is the prevailing protocol for awarding patents in other countries. The new law also attempts to address complaints that the current system hindered innovation, because claims about who invented first were marathon court endeavors. Another significant change is that challenges to patents and infringement cases will first be heard by the Patent and Trademark Office level instead of directly resorting to the court system. It also opens up the hearing process to third parties in an attempt to allow more experts in the field weigh in and weed out frivolous claims. Time will tell if this benefits large companies with the resources and wherewithal to quickly file patents on a large scale, or smaller more nimble companies that didn’t have the legal resources to fight patent challenges that the previous system entailed.
What this new law does not do is address some glaring problems facing the technology industry. Currently there are a number of entities that accumulate vast libraries of patents solely for the purpose of suing for infringement. Many view these ‘patent trolls’ as inhibiting innovation by imposing a ‘tax’ on inventors for infringing patents that arguably are invalid to begin with. By not addressing these so called invalid patents that are overly broad, and often similar, ‘patent trolling’ will still continue. This law also fails to clarify what kinds of software can be patented. What kind of software are abstract ideas, which are methods, and which are patentable processes? As explained later in Bilski v. Kappos, establishing clear definitions of what constitutes a patentable process could make or break the technology industry.
Further problems this law opens up have to do with the quality of inventions submitted for patents. The Act now places emphasis on filing a patent first to garner protection for the invention, rather than patiently refining an invention until it is truly investor worthy. The argument also exists the Act does not remove red tape, just redistributes it. Now with the emphasis on filing rather than inventing, this could benefit larger corporations who have larger legal resources than smaller groups.
Another problem that the article does not touch on is that of expertise. Many people would argue that, under the previous system, a lot of bad patents are awarded, as well as patents for similar, if not the same, invention. This was ultimately due to a lack of expertise and manpower in the PTO office when it comes to the tech industry. Now that they are also charged with hearing claims of infringement, will they have the resources available to make sound rulings on a patent’s validity if they could not do so in the first place? Opening up the process to third parties can certainly help, but one also worries that it would just be a circus with experts on both sides disagreeing on prior art. In the end, the parties can always turn to the court system for a final verdict, so at least the new PTO hearing will be a way to weed out some of the cases and hopefully do so at lesser cost than going to court.
How this relates to KSR v Teleflex:
In the KSR v Teleflex case, we have two automobile parts manufacturers engaged in a lawsuit over whether KSR’s patent was an obvious invention, and therefor whether or not the invention could be patented. If the KSR v Teleflex case were to occur after the passage of this patent reform, the infringement case would not have ever gone to court (unless one party appealed the PTO’s decision). Instead, the companies would go to the PTO office and bring in third parties in the industry to support their case one-way or the other on the obviousness of KSR’s invention. This would certainly have been a much cheaper option to get a decision for both companies, and the tax payer, rather than arguing the case all the way to the Supreme Court. It would probably also benefit the industry as a whole to know if they could use KSR’s method of using a sensor on a pedal earlier rather than waiting for the final case to be heard.
How this relates to Bilski v Kappos :
Bilski v Kappos was a case decided by the Supreme Court that touched on whether or not a business method for the financial industry was patentable. The court found that in this particular case, the method was not, but did not rule out all business methods as being unpatentable. The Economist article talks about how the new law has made a couple changes with regards to patenting methods, but only in regards to the financial industry, choosing not to directly address the technology industry. These provisions of the new law, in keeping with the Bilski v Kappos ruling, may lead to further decisions on the patentability of methods that could go a long way in closing the door on frivolous patent infringement suits, eliminating patents on methods in software altogether, or ending the patent monopolies that large corporations enjoy.