Wednesday, March 28, 2007

It's Time for Patent Reform, IBM-style

In an article titled "It's Time for Patent Reform," IBM's David Kappos notes that patent "issues and crises are finally being addressed by the Supreme Court, Congress, the U.S. Patent & Trademark Office (USPTO)—even the private sector." Kappos once said "We've referred to our [IBM's] patent policy as apparent schizophrenia," and there are some confusing points in his article in BusinessWeek.

Kappos says: "We publish patent applications, but then limit feedback that can be provided to the USPTO by experts from the public." Rule 1.99 allows third parties to send in prior art during the patent examination. The "limit" is a time limit (two months), not a limit on the ability to give feedback.

Kappos says: "For example, patent award damages are often ratcheted up if the courts find the infringer to have intentionally ignored existing patent protections. So the system actually rewards those who haven't checked to see whether a patent already exists." Think about what Kappos said in those two sentences.

Kappos follows with: "Rules that lead companies to place blinders on their developers is a startling sign that patent law has lost touch with the concept of teaching the public about new inventions, which is, after all, the reason for granting patents." Kappos does not mention that patent infringement itself is strict liability. If you infringe, you will lose the case whether or not you knew about the patent.

Kappos writes: "the U.S. gives precedence to those who are first to invent, but not necessarily the first to file a patent application. That opens the door to disputes between a patent holder and a party that can argue it came up with the idea first—even if it hasn't yet applied for a patent." IPBiz notes there are no patent interferences involving a party who has not applied for a patent.

Kappos mentions IBM's role in peer-to-patent: "While the USPTO is dependent on Congress to establish the patent laws, it has already started making internal improvements. This spring it is experimenting with a program that will enable expert volunteers, including those from IBM, to provide feedback to patent examiners on selected patent applications. Better and more efficient patent examination will improve patent quality by reducing the issuance of overbroad patents." [IPBiz notes some of the patent applications are from IBM.]

Kappos continues: "By bringing 21st-century knowhow to a 200-year-old institution, the USPTO is performing a classic arbitrage: pairing those who have expertise, motivation, and access to information with those who need it but lack the resources to generate it." Kappos does not mention that this will allow competitors to review unfavorably patent applications they might deem threatening.

Of business method patents, Kappos does not swear them off: "For example, when IBM, the top holder of U.S. patents, seeks patents for business methods, it aims to do so only for those methods underpinned by deep technical content. Pure business methods can be difficult to examine and tempt some to seek patents of questionable merit."

The "patent troll" issue morphs into "patent pawn shops."

Kappos suggests that there are many patents of low technical quality:

"IBM also is encouraging other patent practitioners to follow its lead with a sort of voluntary, corporate Hippocratic Oath that would institutionalize innovation-friendly patenting behavior. For instance, if more companies focused on ideas of higher technical quality, were transparent about which patents they owned or were applying for, helped review public patent filings, and permitted others to comment on their own pending patents, the likelihood of legal controversy would be reduced."

***IPBiz notes

Separately, of the "review by third parties" aspect, some people might find it interesting to review the purported relevance of the paper "Development of Advanced Hitachi Electronic Patent Application System Toward a New Patent Age of Improved Support for the Operation of an Intellectual Property Department" (Yukihiko Takada and Kiyonobu Matsumoto, 74 JPTOS 315 (1992)) to the claims of the patent discussed by Jaffe and Lerner in Innovation and Its Discontents. There are a lot of things that might appear to be relevant to patent examination that are not relevant at all.

Specifically, let's go to text in Innovation and Its Discontents:

At page 144:

Consider Patent No. 6,049,811, which is for a “Machine for Drafting a Patent Application and Process for Doing So.” Describes a computer that poses a series of questions to a potential patentee, asking him to describe his invention. The application for this patent cited as relevant prior art just one other patent and two published articles.

Greg Aharonian pointed out, a line of research at Hitachi anticipated this event by many years (165)

In 1992 JPTOS published an article by two of the managers of Hitachi ’s Intellectual Property Division, describing in detail their development of a new system to automate the patent application process (166). Apparently the examiner also missed this publication in his search of prior art. [74 JPTOS 315-334 (1992)]


The book Innovation and Its Discontents has been reviewed by a number of intellectual property law professors. None have commented on this example, which in fact is central to the allegation that the USPTO is missing key references in examining patents.


The first claim of US 6,049,811 states:

A machine for drafting a patent application having at least sections including claims, a summary of the invention, an abstract of the disclosure, and a detailed description of a preferred embodiment of the invention, said machine comprising:

one or more input devices, one or more output devices, and a computer with memory for receiving and storing data from the input devices, transmitting data to the output devices, and storing program steps for program control and manipulating data in memory;

the computer, through input and output devices, requests and stores primary elements (PE) of the invention that define the invention apart from prior technology before the claims are drafted;

the claims are drafted before the summary of the invention, abstract, and the detailed description of a preferred embodiment of the invention is drafted; and

the computer requires drafting the sections in a predetermined order prohibiting jumping ahead to draft a latter section.

Without commenting on whether this claim is valid, the pertinent question is whether 74 JPTOS 315 anticipates the claim.

One gets a hint that 74 JPTOS 315 is about something entirely different than the '811 patent at page 320: which states "The distributed patent offices convert the application documents and specifications (prepared on word processors) to electronic application format." One also has the text: "Each patent specialist is furnished with a word processor unit for the preparation of patent specifications." If one looks at the figure on page 321, one finds a cartoonish image captioned "inut to computer of inventor's manuscript." Another cartoonish image is captioned "order a prior art search." Another cartoonish image shows "break up of invention" which has pictures of people at a conference table. Another cartoonish image has "evaluation" with one man sitting at a table with papers (no computer).

At page 322, one sees that the JPTOS document does NOT teach the elements of the '811 patent. The JPTOS article states the first step in processing the application is the preparation of a patent application manuscript by the inventor. There is NO teaching of a sequence of "claims before summary of invention," etc. The "advance" disclosed in the JPTOS article is that "the inventor prepares the patent specification manuscript on a word processor." Of course, the inventor has already written down everything (in no particular sequence) on paper, as Figure 5, on page 321 shows. There is NO TEACHING in the JPTOS article of what is in claim 1 of the '811 patent.

The episode on page 144 of Innovation and Its Discontents illustrates a number of things:

#1. Jaffe and Lerner seem to be uninformed about the meaning of prior art. To paraphrase Emerson, the more they talked about the failures to find prior art, the more I wanted to check the prior art they said was unfound.

#2. The statement by Jaffe and Lerner, "Apparently the examiner also missed this publication in his search of prior art," is entirely irrelevant. The examiner was totally correct in not citing a reference that had nothing to do with the claims.

#3. If Jaffe and Lerner, who supposedly know something about patents, as well as all the intellectual property professors who reviewed this book, spent a lot of time on this but missed a rather fundamental mistake, what's going to happen when people of LESS SKILL in patents and LESS TIME to study a matter are unleashed in the peer-to-patent program?

#4. What is one supposed to make of Kappos' statement: "By bringing 21st-century knowhow to a 200-year-old institution, the USPTO is performing a classic arbitrage: pairing those who have expertise, motivation, and access to information with those who need it but lack the resources to generate it." In Innovation and Its Discontents one had the 21st century expertise, motivation and access to information of numerous professors to a rather simple example of the application of prior art to a patent claim, and look at the result.

2 Comments:

Blogger Ronald J Riley said...

David Kappos speaks for a company who let the Japanese take the mainframe market from them and Microsoft take the operating system market. The only reason that IBM still exists today is their patent portfolio. IBM is a husk of its former self and a joke.

IBM files hordes of incremental mostly insignificant patents and their conduct is one of the reasons that the patent system is burdened. They sense that their days are numbered, and that eventually they will expire with a whimper.

They have a vision for a patent system which is a king's sport, where only the privileged vested interests can play.

There are two major big business camps promoting reformation of the patent system.

One group simply wants to eviscerate the system to mitigate the consequences of their patent pirating conduct. This group was initially formed by washed up tech companies who lost their ability to produce significant inventions decades ago and a few parasitic companies who never were innovators, rather they are shrewd predators on innovators. They were then joined by the insurance and banking industries, of which one group is only innovative at denying claims and the second group's claim to fame is inventing ever more and larger fees. This group calls themselves the Coalition for Patent Fairness, but are better known as the Coalition for Patent Piracy. Their members have a variety of deficiencies such as being caught cooking their books, putting their customers at risk of being maimed or killed with defective products, committing fraud on the court in litigations over their patent piracy, and various other sins.

The second group are much older companies. They tend to value their patents but would very much like to reign in pesky inventors who nip at their heels. They are also hot on HARMazation of America's patent system, a process which dumbs down the greatest patent system in the world for those company's benefit. This group is known as the 21st Century Patent Coalition. While they are marginally better than the Coalition for Patent Piracy they are also very short term gain oriented businesses.

Both groups prey on the real inventors of our country. Both are prone to abuse the process of law in a bid to bankrupt inventors. Both ship the fruits of American ingenuity to developing countries. Both groups routinely indenture inventors in those countries and will dispose of their empty husks just as they have done to our inventors when they find a slightly better deal elsewhere.

Independent inventors have community ties and when they prosper so do their communities. But when the inventors have their spirits killed by disreputable and predatory large companies, the community suffers a much greater loss than the inventor.

Beware, for these companies are throwing hundreds of millions of dollars into "reforming" our patent system to be more friendly to them and much less friendly to upstart startup companies. They know that this is a bargain if it facilitates their appropriation of billions of dollars. It is a fact that many of the companies promoting various special interest "reforms" of the patent system have been caught red handed cheating, lying, and thieving - and they are being held accountable for their poor conduct. Accountability is what drives their whining about bigger than live mythical trolls.

Ronald J. Riley,
President - www.PIAUSA.org - RJR at PIAUSA.org
Executive Director - www.InventorEd.org - RJR at InvEd.org
Senior Fellow - www.PatentPolicy.org - RRiley at PatentPolicy.org
Washington, DC
Direct (202) 318-1595 - 9 am to 9 pm EST.

8:36 PM  
Blogger John said...

Ronald Riley hits the nail on the head. Many of the talking heads from large corporations seem to have forgotten their companies were started by independent inventors who were looked down upon then and needed the protect of the US Patent System to give them a leg up. Too many people want to pull up the ladder after them. Most reforms of the patent system in the past 40 years which is co-extensive with my working life as a patent attorney have been to the detriment of small inventors. That's all.

John Flanagan

5:33 PM  

Post a Comment

<< Home