Sunday, March 12, 2006

Do "patent troll"/small inventor alliances impede US innovation?

If a so-called patent troll helps a small inventor make money from an invention, has innovation in the US been hindered? That issue is obliquely raised in Jeff Nesmith's "Critics: Reform patent system": The patent he [Ware] obtained in 1987 expired last year. But now, thanks in part to two companies that have been accused of milking the system by using poor-quality patents to threaten nuisance lawsuits, Ware says his invention is bringing him the most money he has ever earned.

Elsewhere in the Nesmith article:

Business school professors Adam Jaffe of Brandeis University and Josh Lerner of Harvard University argue in their book, "Innovation and Its Discontents," that rather than stimulating innovation, the patent system is becoming a hindrance.

This is true, they said, because of "bad patents" and court decisions that make it easier to enforce them. [IPBiz note: Jaffe and Lerner relied on the Quillen/Webster data to make inferences about bad patents. As such the Jaffe/Lerner conjecture may be seriously questioned.]

Some critics say poor inventions that fail to meet statutory criteria for a patent, such as novelty, utility and nonobviousness, are nevertheless patented because examiners are overworked. [IPBiz note: the average time an examiner can spend on an application has been limited for some time.]

They say that by rushing undeserving patent applications to approval, examiners are able to meet quotas and improve their annual employee performance reviews.
Jon Dudas, the undersecretary of commerce who runs the U.S. Patent and Trademark Office, said that is not true.

He acknowledges that the number of examiners in his agency has not kept pace with the workload, even though the number of examiners has nearly doubled since President Bush took office. Hopeful inventors have set a new record in volume of applications every year for the last 20 years, he said.

"But it's a backlog issue, not a quality-of-patent issue," Dudas said.
Dudas said the backlog of applications awaiting a final decision is expected to pass 1 million during the current fiscal year, which ends Sept. 30.

**Of the issue of time for patent examination, here's what the examiner's group [POPA] has to say:

Employee Comment: Get the examiners more time to do the cases. There are too many gs15s not examining. Reduce the QAS, SPRE and SPE positions and give us more time across the board to do cases. We need more time to do our cases more than a pay raise, at least some of us do. I would even before using pay raise money to hire more examiners and give us more time - significantly more time. POPA Response: POPA certainly concurs that examiners need more time to do a quality job. Management has made a concerted effort to employ more "watchers" at the GS-15 level to find errors often caused by lack of time for the examiner rather than to use that money to provide examiners with more examining time so the job can be done right the first time. [IPBiz note: recall what Deming said]

Q: What is POPA doing, if anything, to actually increase the number of examining hours per balance disposal to provide for quality examination and what is POPA’s likelihood of success?
A. POPA has been testifying before Congressional Committees and lobbying Congressional members and staff on the issue of more time for examiners for at least 10 years. POPA has written in our Newsletter distributed to many influential government and private sector individuals and organizations on the need for more time. The most recent news release from POPA called for an increase of 20% more time for examiners since the goals have not been changed since 1977. The effort for increased time for examination has mainly been one of lobbying and public relations along with some inroads for "other time" since the amount of work performed and the goals have been non-negotiable to the Association since 1978. POPA IS PROHIBITED BY LAW FROM NEGOTIATING ON PRODUCTION OR GOALS. In 1976, POPA won a court decision to allow us to negotiate many of the current goals only to have that right taken away in 1978. The goals system has remained essentially the same since that time with the determination of production goals being at the sole discretion of USPTO management. USPTO management has seen fit to not provide even a single minute of additional time over this period despite the additional duties, lengthy actions, equipment malfunctions, endless review and oversight, increase in technical complexity, etc. that the examiners now endure. Our successes have come in the form of "other time" for additional duties that management has heaped on the examining corps. However, in the current political environment, when POPA negotiated for time for examiners to rebut and respond to accusations by management of alleged error on the part of the examiner, the political appointees of the Federal Service Impasses Panel ruled to provide examiners ZERO time to do so.


Blogger kenny said...

John Dudas says there is no patent quality issue? Wow. Talk about institutionalization.

Of course there is a patent quality issue. Of course there are tons of bad (obvious, non-useful, covering prior art) patents granted each week.

What else does the fact that around 75% of applications result in an eventual patent indicate, other than that the USPTO is much too eager to grant patents, regardless of quality.

John Dudas doesn't want you to look at the man behind the curtains. He doesn't want you to believe that the system is broken. He wants you to trust that the USPTO is doing a grand job.

It is not. The system is broken. Patent quality is in the toilet. That's a tough pill to swallow if you are a holder of a bad patent, if you are a patent lawyer, or if you work at the USPTO. But that's the truth.

7:55 AM  

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