Friday, October 15, 2004

Putnam and Tepperman revisit rational ignorance

Jonathan D. Putnam and Andrew B. Tepperman revisit Mark Lemley's rational ignorance at pages 17-19 of the October 2004 issue of Intellectual Property Today.

Quite distinct from Lemley, who advocated the status quo in his 2001 article in the Northwestern University Law Review, the authors state:

-->The only real solution to these problems is to make sure that the PTO has the resources to keep most bad patents from reaching the market. The issuance of poor quality patents causes an externality to transacting parties which largely cannot be otherwise internalized.<--

All right, tell me what externality scientifically invalid patents cause to transacting parties. For example, one should know whether or not there are hydrinos independently of whether there is a U.S. patent on them. There are bad patents that cause externalities and bad patents which don't cause externalities.

The authors also write
-->we view the optimal solution as one which increases resource expenditures until the marginal social benefit of reducing bad-quality patents is equal to the marginal social cause of increased resource expenditures.<--

This is a nice exposition of high school calculus, but doesn't give anyone any answers of "how much" more money to give to the USPTO. Also, the authors neglected to cite the Ghosh/Kesan paper on optimal ignorance at 40 Hous. L. Rev. 1219, otherwise cited in a different paper in the Oct. 2004 issue of Int. Prop. Today (at page 41).

In endnote 5, the authors repeat the false canard about firms telling R&D staff not to read competitor's patents, an observation Lemley made in rational ignorance. This wasn't even true before Knorr-Bremse, but it is impossible to swallow after.

Of Knorr-Bremse:

As stated in the Knorr-Bremse opinion, the touchstone of willfulness is whether the infringer acted as a reasonably prudent business person to avoid infringing another’s valid patent rights. Knorr-Bremse, 2004 U.S. App. LEXIS 19185 at *26-27. A policy of telling employees not to read patents of competitors would not seem a reasonable way to avoid infringing another's valid patent rights.

The Knorr-Bremse court reaffirmed that “there continues to be ‘an affirmative duty of due care to avoid infringement of the known patent rights of others....’” Id. at *22 (citation omitted); The court thus arguably reaffirmed the principle that infringers may not simply ignore patents of which they are aware, hoping they will not be sued.


Blogger Jon Putnam said...

"The fear of willfulness is so great that often firms instruct their engineers not to look at patents," said Matthew Schruers, senior counsel to a tech lobbying firm called the Computer and Communications Industry Association. Because of the willfulness issue, the expense of searching patents and the difficulty of actually understanding them, "It's gotten to the point where most software application developers cannot plausibly say they've conducted complete patent searches," he said.

1:51 PM  

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