US Congress promises death to patent trolls in bipartisan law scribbling

A new bill that will bring about the end of patent trolls will be introduced to US Congress today (Wednesday). Its backers are confident it will be signed into law "in six months or less." At a press conference launching the Patent Act earlier today, senior leaders from both parties spoke strongly in favor of introducing new …

[W Donelson]

Does nothing...

Does nothing... to stop BAD patents being awarded by the vastly underfunded USPTO

[Anonymous Coward]

Re: Does nothing...

It is harder to get agreement on how to fix that. It is simple to say "stop awarding bad patents" but putting that into a law isn't so easy. Sure, the real fix is "no software patents" but there are too many stakeholders who don't want that to happen.

[Eric Olson]

Re: Does nothing...

Every time the country encounters an upheaval due to technological innovation, bad patents get awarded. It takes time for examiners to understand the new technology, courts to sift through the competing patents, and for the process to play out.

Case in point: The sewing machine.

Many different models using patented technologies, or broadly-worded patents that could apply to any number of implementations. Hell, there were even a prominent "rights holders" at the time who did not and had no interest in making sewing machines, just profiting off lawsuits against companies, retailers, and consumers who purchased sewing machines that contained technology that might have been covered by a patent in their portfolio. Take a look at Elias Howe Jr. if you want to see Patent Troll Prime, though at least he did invent something at one point. Back then, the proper epithet was "patent shark".

At roughly the same time, the 1850s saw an anti-patent movement that almost got the whole patent system dismantled in Britain and Prussia, while the Netherlands and Switzerland actually stopped issuing patents for decades.. They did not get much traction in the USA, however.

My point is that none of this is new and is in fact what happens when a new field of R&D emerges and the race to file begins. Here is an interesting academic look at the 19th century patent wars.

[Voland's right hand]

Re: Does nothing...

Just ban software and business method patents. Plain and simple.

[Charles 9]

Re: Does nothing...

No need to ban them altogether. Just note they're in rapid-turnover industries and make them appropriately short in length. The original term of 20-some years came about when designs and such had lifecycles in the decades: a length out of place in fast-moving industries. If a software patent was only good for, say, three years, software innovation still gets a fair bite of the apple. Not only that, remember that any patent that expires becomes public domain and open to everyone. That can effectively stifle rampant software patenting in itself if trade secrets are involved (due to the risk of giving information to the competition too soon).

[Trigonoceps occipitalis]

Re: Does nothing...

And the words "On a smart-phone."

[Nunyabiznes]

I certainly hope this works better than some of the other technology-related bills that have had bipartisan support. CAN-SPAM, DNC list, DMCA...

The first thing I noticed is that the bill has nothing in it about reforming the US Patent Office or how patents are awarded (that I saw in my brief skim). That alone makes it a fail in my book, but it is possible it will be slightly less of a fail if it does reduce trolling.

[Anonymous Coward]

USPTO revamping

The USPTO needs to be revamped to decrease the number of stupid & redundant patents.

The fact that the USPTO has issued basically the same patent for using a laser pointer as a cat toy at least 5 times underscores this issue:

5443036 Method of exercising a cat

6505576 Pet Toy

6557495 Laser Pet Toy

6651591 Automatic laser pet toy and exerciser

6701872 Method and apparatus for automatically exercising a curious animal

[Charles 9]

Re: USPTO revamping

But to do that takes money. Guess who's responsible for the USPTO's budget...

In any event, I also note the absence on any kind of reform IRT patent lengths relative to the industry, which can solve the patent issue in fast-moving industries like software without having to necessarily outlaw them (IOW, you need to make patents short for fast-moving industries to reflect their more rapid turnover. That way you still encourage novel thinking while recognizing they only need so much).

[Eric Olson]

Re: USPTO revamping

Guess who's responsible for the USPTO's budget...

The people filing the patents are responsible. All fees collected are used by the USPTO to pay for administrative costs and a reserve fund. They do not rely on Congress for funding, nor do they have to divert their funding to the general fund to see it come back (thought they do have to ask permission to use it...). It is a self-funded governmental office.

Of course, being self-funding is not the same as self-organizing or autonomy. For many years, the USPTO was limited in how much it could increase fees or how it could tier them. With the America Invents Act, they were provided authority to adjust fees as necessary to reflect the aggregate costs associated with their mission, with the added authority to adjust the fee schedule based on the size of the patent submitter. With those changes, the USPTO has been able to hire more examiners and reduce backlog.

[Charles 9]

Re: USPTO revamping

"With the America Invents Act, they were provided authority to adjust fees as necessary to reflect the aggregate costs associated with their mission, with the added authority to adjust the fee schedule based on the size of the patent submitter. With those changes, the USPTO has been able to hire more examiners and reduce backlog."

I suspect that bureaucracy is making things a bit slow over there. It was only signed in late '11, and it's only now starting to kick in much. There have been I recall more than a few rejections of not-so-novel patents, so perhaps this is a sign the pace is picking up. Plus there's the matter of extreme legalese that tries to submarine a patent. That said, my point still stands that the USPTO has to set the fee schedules accordingly to avoid a "barrier to entry" backlash from one or another group of filers.

[Eric Olson]

Re: USPTO revamping

These days, most patent applications come from business and researching institutions (generally universities and labs). The cost of filing for a patent for those bigger companies are small.

AIA did create the "micro entity" to reduce fees by upwards of 75%. I didn't go into it in my original post, but it's a person (almost always) who is named on fewer than four applications and does not have a gross income in excess of 3 times the median household income (so that would be $155,000 or less right now). This is for the true (some say mythical?) garage or shed inventor and to get those InventHelp like companies out of the business because the fee reverts to normal if the inventor is required to transfer the patent to another entity that does not meet those criteria.

There already existed a "small entity" that covered individuals and small institutions where fees were reduced by up to 50%, so AIA just created an even cheaper tier.

[phil dude]

peer review?

Perhaps a peer review system?

You file a patent, which is a recorded event. Protection is provided immediately, however the granting the patent allows interested parties to say "I have prior art". If parties do not complain, they cannot complain later. I would see this a bit like copyright and "mark maintenance".

So the patent filer has to show their thing is unique , and the USPTO only has to consider interested parties.

Does this sound whacky?

P.

[tom dial]

Re: peer review?

The obtuseness of patent filings militates against this, as does the implied requirement that those skilled in various particular arts regularly review the patents filed in their area of expertise. I have seen recommendations against that, the arguments being that it is wasteful of possibly productive time and that evidence that you consulted patent filings might be used adversely if you ever were accused of infringement. "Willful" violations, I believe, can lead to enhanced punishment.

The correct solution is for the USPTO to do its work properly in the first place, although I have seen arguments by academics that patents are intrinsically bad (and not limited to those on software).

[Charles 9]

Re: peer review?

"The correct solution is for the USPTO to do its work properly in the first place, although I have seen arguments by academics that patents are intrinsically bad (and not limited to those on software)."

But how can the USPTO do its job right on a shoestring budget? And no, it can't raise fees because inventors (especially small ones) will complain of a barrier to entry.

[e_is_real_i_isnt]

Re: peer review?

I believe there is already a similar plan in place that allows ordinary people to challenge patent applications. I haven't tried it myself, and it may have lapsed, but apparently it is/was fairly effective and relatively cheap.

The mentioned bill sound like what the courts have been asking for. After Congress and a former Administration broke the longstanding tradition of using the USPTO to do decent searches and weed out bad patent applications, the outcome fell to the Courts, who weren't pleased that the Legislative and Administrative branches were dumping their obligations.

The USPTO is/was trying crowd sourcing to do the weeding, but this takes care of the stuff that gets through.

Maybe if the rewards of crap patents drop off in the Courts, the rate of applying for them will also drop off and this particular feed-back cycle will get snuffed out.

[Voland's right hand]

Re: peer review?

This will work only in "hotly contested" areas which usually have funding anyway so they do not need it that much as it is not difficult to find a sponsor to work on invalidating the patent using the existing review procedures.

[GBE]

I'm sure this will delay the trolls for few days.

Great.

I'm sure it will take the patent trolls days -- weeks even -- before they've figured out how to game the new system as effectively as they're gaming the old one.

[Thorne]

Re: I'm sure this will delay the trolls for few days.

Right now trolls are out shopping for senators.

America, the best government and legal system money can buy......

[Smithbrian]

Great day for crony capitalism !

This bill is written for Big companies so they can steal from small companies.

This bill requires a startup to "guarantee" that it has Funds to cover the cost of Goolge lawyers.

The startup has to provide a certificate to the court that it has the FUNDS to cover Googles lawyer fees!

It is bad for the small companies, Because a small company will never be able to enforce their patents!

Before saying it is the best thing since sliced bread. Please go read the Bill.

http://www.judiciary.senate.gov/imo/media/doc/PATENT%20Act.pdf

Page 26 Line 7 -15

--------------------------

Not later than 45 days after being served with an initial state-ment under subparagraph (A), a party alleging infringement shall file a certification that—

(i) establishes and certifies to the court, under oath, that it will have sufficient funds available to satisfy any award of reasonable attorney fees under this section if an award is assessed;

------------------------------------------------

That mean if you are a startup: you will never be able to go after Google, Microsoft, Facebook, or any other big company.

This would be the biggest gift to the Big company Lobbyist from the congress. It is bipartisan because both republican and democrats what these big companies to write checks to them.

Great day for crony capitalism !

[Charles 9]

Re: Great day for crony capitalism !

I see where this is going. Don't think of this in terms of the big boys suing you (in which case the onus falls on them) but rather them unilaterally usurping a patent and leaving the original inventor in the lurch. These firms can hire legal terms in the tens if not hundreds of lawyers, each of which can pick apart certain aspects of state and federal law to get what the firm wants. And they're not cheap. California and US Circuit cases both upheld judgments where the rates were both estimated and generous, which in the case of a defendant with a large team of lawyers all paid at least $150 an hour, let's just say the numbers add up: the bigger the firm, the bigger the bill (which also raises the chance of the defense winning the case AND having it upheld on appeal--both the aforementioned were upheld on appeal, too).

So if Google's defense team is some 50 seasoned lawyers all demanding $200 an hour, that's $10,000 an hour in legal fees throughout the trial, and if the trial goes on for a long time, the plaintiff runs a very real risk of being bankrupted if he/she loses (a risk a 10 or 11-figure defendant would not face even with a huge judgment against it).

[Tom 13]

Re: So if Google's defense team

Except that's not how these things actually get billed. Each lawyer who is billing has to demonstrate they performed actual work for the case. At trial, at most three lawyers sit to present their side. Granted, those three lawyers are probably billing $500 to $1,000 an hour, but that's still far less than $10,000 an hour at trial. Discovery is done by flunkies and even outsourced to $25/hour companies.

Not that the bill isn't an obstacle for the little guy. When I was on the board with a group who HAD to sue to protect a trademark, we thought long and hard before ponying up the $20,000 our lawyer recommended be set aside to cover potential costs of the suit. And yes, the bastages we had to sue played the clock to the fullest, only surrendering hours before the case was to go before a judge. It was a complicated mess and one I hope I never have to partake of again.

[Tom 13]

Re: Great day for crony capitalism !

You WANTED language to make patent troll liable for the legal bills of legitimate manufacturers. This is EXACTLY what the language needs to look like.

I warned against this and was repeatedly told I needed to remove my head from my nether region. Guess we'll all have to live with it now.

[Whitter]

Punative legal costs

Legal fees of "the other side" should be a fixed value based on a single run-of-the-mill lawyer's cost for a reasonable length of time. If the other party want's to spend more than that - it is their concern; their money.

[Charles 9]

Re: Punative legal costs

State and federal case law is against you. In both cases, reasonable is assessed by average per head, and these cases have been upheld on appeal.

[mistergrantham]

Legal costs should be paid for by the state, since it's the state's laws that bring people to court. I believe this would create political pressure to hose the cruft...

[Charles 9]

No, it would bring political pressure to prevent it ever happening. Recall that most politicians ARE lawyers. The LAST thing any high-paying private business will want is takeover by the state. You'll be hearing "SOCIALISM!" for years if you tried.