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March 21, 2006
Supreme Court - take two
Yesterday, I highlighted today's Supreme Court hearing on patents. I would like to draw your attention to an excellent essay on the broader issue of patent reform in today's Wall Street Journal by Adam Jaffe and Josh Lerner - "Innovation and Its Discontents":
The problems of the U.S. patent system are under discussion today with an urgency not seen in decades. The Supreme Court will soon hear oral arguments in eBay v. MercExchange LLC, which promises to be its most far-reaching examination of patent law in many years. Today the court will also consider LabCorp v. Metabolite Laboratories -- the contested matter is whether a patent can be issued for the correlation between a disease and a naturally occurring substance in the human body. That is: Can you actually patent the laws of nature? And shockingly, Research in Motion has been forced to pay $612 million to prevent all of our BlackBerry handhelds from going dark, even though the U.S. Patent and Trademark Office (USPTO) has indicated that it is likely to find all of the patents behind this ransom demand invalid. Congressional subcommittees, with good reason, have recently held hearings asking fundamental questions about developments like these in the patent system.The importance of this long-overdue focus on patents cannot be overemphasized. The past decade has seen periodic uproars over particular patents, such as Amazon's "one click" patent for online shopping. The troubling patents have been well publicized, but the wrong lessons have typically been drawn. Commentators have tended to focus on the incompetence of the USPTO in allowing "bad patents." Others have concluded that the patent system is not working with respect to a particular area of technology. Concerns about software awards led, for instance, Jeff Bezos of Amazon to propose a new patent type for software; others have suggested that biotechnology be excluded in various ways from the patent regime.
We believe, instead, that the problems with the patent system are systemic and fundamental, the result of two congressional changes to the patent system. At the time they were described as administrative and procedural rather than substantive; but taken together they have resulted in the most profound changes in U.S. patent policy and practice since 1836. One set of changes has made it easier to enforce patents, easier to get large financial awards from such enforcement, and harder for those accused of infringing patents to challenge the patents' validity; another set of changes has made patents much easier to get. The combination has created a perfect storm: a complex and intensifying combination of factors that increasingly makes the patent system a hindrance rather than a spur to innovation.
Unfortunately, the patent reform legislation they allude to seem stuck in the process. As a result, it may be the Supreme Court who has to break the stalemate. With all the attention now being paid to "competitiveness" on Capitol Hill, one would hope that the lawmaker would take the hint and address the key issue of patent reform. Let us hope that the Court's actions will lead the way.
Posted by Ken Jarboe at March 21, 2006 9:08 AM
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