Last week marked the 224th anniversary of the U.S. patent system, an institution designed and brought forth to promote progress in the fledgling nation. Despite its value for more than two centuries, that system is under attack.
Until the late 18th Century, innovative colonists in the Americas relied on British-based patent laws to obtain colonial patents. In 1790, however, American citizens could obtain a patent under the new U.S. patent system. In his first Message to Congress on the State of the Union, George Washington stressed the importance of a patent system, which provided “the expediency of giving effectual encouragement as well to the introduction of new and useful inventions from abroad, as to the exertions of skill and genius in producing them at home.”
A successful country needs new ideas and businesses. The U.S. patent system provides the carrot to attract innovation by granting a 20-year period of exclusivity. However, inventors must pay a price for this right: full disclosure. They must reveal every detail about the invention, and after 20 years of development, promotion and profit, the scientific and technological knowledge in that innovation enters the public realm for all to use. America’s founders recognized that patent rights, although very strong, also were short-lived and served a greater public purpose.
Over the past two centuries, the patent system has operated like a faithful and sturdy machine powering America. The engine requires tweaking on occasion, and it has been under attack since its inception. However, the strength of the U.S. patent system is the envy of much of the world. Innovation flourishes under it, and inventors thrive in a competitive environment, thanks to the robust patent system.
Individual Inventors Imperiled
Technological innovation used to be a relatively slow process, often requiring many years of product development and testing. The length of patents and their use were far less controversial. As technology accelerates, however, the patent system has been criticized for stifling innovation.
The Wright Brothers were condemned for relying on patents and accused of hindering aeronautical innovation in the early 20th Century. Eerily similar to today, these “small inventors” were attacked for protecting their intellectual property. Others, far better financed, failed miserably for years.
Suddenly, two upstarts from Ohio turned the world upside down by demonstrating that heavier-than-air flight was possible. The Wrights protected their works with patents and litigation, and the also-rans attacked them for stifling airplane technology. Had the term been used then, the Wrights would have been called “trolls.”
In 2011, at the behest of large corporations with well-founded lobbyists, Congress and the White House made major changes to the patent system in the America Invents Act. Two years later, they are insisting on further patent reforms. Despite the societal benefits of the U.S. patent system, some companies are intent on abolishing it in order to stop patent litigation against them. This is like getting rid of medical malpractice claims by getting rid of doctors.
The draconian proposals in bills now before Congress and rules being promulgated within the United States Patent & Trademark Office may seriously undermine the entire patent system. In a country whose financial stability is vested in the creation of ideas instead of products, even seemingly small changes can have overwhelming and serious consequences.
Despite the percentage of patent lawsuits remaining stable for decades, lobbyists and others claim that the patent system is running amok and that there is a scourge of new patent litigation filed by patent trolls. As with all litigation, including patent litigation, the parties may play rough in this battle, and those with the most money can play rougher.
Indeed, patent suits among major players can range in the millions of dollars. Sanctions for abusive litigation behavior — e.g., the inappropriate assertion of a patent or bad conduct of a defendant — already are governed by statutes that allow attorneys to shift fees and costs to the abuser. Yet lobbyists wish to make fee-shifting practically mandatory and otherwise interfere with patentees asserting their lawsuits — all patentees, whether worthy or not.
The individual inventor, without funding or reasonable contingency opportunities, will be outgunned by large corporation attorneys eager to push their heavy fees onto the patentee plaintiffs. Thus, individual inventors, small companies, universities and others will be thwarted in protecting their rights, no matter how much they are aggrieved. As is readily apparent, this radical change will transform the nature of litigation and penalize all patentees, not just the few that arguably are abusing the system.
Out of Gas?
Did the Wright Brothers — ostensible patent trolls — deserve their fame? Few doubt it. Patents helped them and many other famous American inventors maintain their relevance in the face of stiff competition. Nowadays, it might seem preferable just to focus on keeping the market advantage with continuous innovation instead of patenting. This is fine for large corporations, but a great difficulty for the small inventor.
True innovation does not come from large corporations, noted Google Chairman Eric Schmidt in an interview on 60 Minutes. Instead, it is some “graduate student” or “crazy person” that makes change — such as the obscure Wright Brothers warping airplane wings to control flight.
Without a patent system, innovators and inventors from all walks of life will be unable to safeguard their intellectual property and profit, violating a central tenet of the patent system. Penalizing the poor students and the visionaries by hindering their chance to protect their technological advances in patent litigation is neither justifiable nor right.
Legislation making fundamental changes to the law to prevent innovators (and their backers) from having their say in court is highly suspect and perhaps unconstitutional. Further, in a time when Americans have lost countless manufacturing jobs and have retooled, it does not make sense to weaken something Americans are good at: innovating and inventing.
The U.S. patent system is a modern marvel. Despite its age, it has served the nation well and will continue to do so. Americans should honor it every year and endeavor to live up to the ideals of the forefathers who created it. As Abraham Lincoln said, the patent system adds “the Fuel of Interest to the Fires of Genius.”
If the White House and Congress keep fiddling with the patent engine and depriving it of fuel, America’s forges of constructive creativity may die out. Both Washington and Lincoln favored strong patent protection for all Americans — not just rich Americans or corporations. The U.S. patent system now is being challenged by special interests, devoid of respect for a national treasure. The founders crafted the country’s patent laws, placing them in the Constitution as a means to encourage the progress of useful arts.
In one year, the U.S. patent system will be 225 years old — another milestone. With the ongoing serious challenges facing the system, threatening to derail the dreams of America’s forefathers, I thought it best to celebrate a year in advance.