Judge Michel Would Repeal the Judicial Eligibility Criteria

In a “Supplemental Statement” to his Sept 12 testimony before House Judiciary, former Federal Circuit Chief Judge Paul Michel submitted a comprehensive set of recommendations to restore stability to our patent system. While Congress is entangled in ACA and fiscal chaos, we hope to discuss some of the issues he raised in more easily digestible chunks. One of these is the SCOTUS addition of judicial eligibility criteria to the Patent Act’s Sec 101 eligibility directives. Although these issues are not subject to PTAB’s IPR review, they are very important to research universities whose patent prosecution and enforcement proceedings often involve life science and software subject matters. They are ill-defined. In the post-AIA patent world, ill-defined is undefined. At the least, they invite examiner subjectively and judicial inconsistency. Waiting for SCOTUS to clarify their meaning is dangerous to our innovation economy when other countries don’t invoke them at all.

In his Executive Summary Judge Michel recommends as follows;
B. Amend 35 U.S.C. § 101 to Eliminate the Current Uncertainty in Patent-Eligibility Law.

Patent-eligibility law under § 101 has descended into chaos after a string of Supreme Court decisions. Congress must amend the statute to bring order from chaos. The legal uncertainty is devastating American business, including high-tech, manufacturing, biotech, and pharmaceutical industries. Section 101 must be amended (a) to recognize that a patent claim with a physical aspect or element necessarily satisfies patent eligibility; (b) to clarify that processes containing solely mental steps are not patent eligible; and (c) to add the following: “Eligibility shall not be denied based on any judicially-imposed exceptions.” ( see cite below) Continue reading Judge Michel Would Repeal the Judicial Eligibility Criteria

From Phil Johnson’s Lips

Perennially PTO Director short-lister Phil Johnson has been “bride’s-maided” once again, this time by Andrei Iancu. Had Phil become PTO Director PTAB’s anti-patent attitude would have shifted in short order. Mr. Iancu’s views are yet unknown. But having actively participated in its creation, Phil knows AIA’s history and intent as well as anyone. His IPW post today explains how far the PTO has veered from its intent. In his IPW-excerpted statement (below) Phil discusses IPR petition review and other PTO AIA failures saying;

” Those now familiar with IPR proceedings will already have recognized how little resemblance current IPR proceedings have to what most supporters of the AIA envisioned upon its passage. In current practice, the role of the Director as an independent IPR gatekeeper never materialized because the USPTO’s implementing rules bypass the Director altogether, assigning the institution function to the PTAB, which in turn routinely assigns both the institution and final decisions to the same three-judge panel. As a result, most of the safeguards against patent owner harassment were lost. By failing to adopt the implementing rules needed to carry out the intent of the AIA, and by adopting other rules and procedures that are plainly skewed towards petitioners, the PTAB has intentionally tilted its IPR proceedings against patent owners. While this has been good for the PTAB, which has quadrupled in size, it was neither Congress’s intent nor that of most of AIA’s supporters to create an unfair IPR patent “killing field.”

What Phil knew or should have known before AIA’s enactment is “spilled milk” today. However well-intended were his efforts to enact it many now believe his congressional push for “harmonization” and “first to file” were bad ideas and untimely especially when Congress and the White House were in Silicon Valley’s thrall. That AIA turned out to be disastrous is no surprise to those of us opposing it to the bitter end. That was then. Today his detailed IPWatchdog post’s two closing paragraphs say what he knows now to be the case. We agree. PTAB can and must quickly be redirected by its next Director.

Phil ends his lengthy post with two important paragraphs. Please read on.

Continue reading From Phil Johnson’s Lips

Apple’s Shifting Congressional Priorities

According to today’s “Business Insider” Apple’s CEO Tim Cook, who leads the company whose fervid anti-patent efforts in Congress and the courts are legendary appearing at the Bloomberg Global Business Forum said today he favors a US immigration policy focused on the immigration of talent.  Cook said

“If I were a world leader, my goal would be to monopolize the world’s talent,” Cook continued, saying that smart people create jobs” (visit our website for a link to the full piece)

Really?  We are well-aware of Cook’s monopolist tendencies but pro-patent advocates cannot help but wonder whether Cook is joking, lying, or Apple’s CEO’s right hand is unaware of what his left hand has been doing to our US patent system for the past ten years. Our big tech-inflicted US patent system’s weakness is driving talent away from the US. Significantly research universities are losing research talent and investors to offshore venues including China. Worse, this talent/investor emigration will become permanent unless we repair our US system soon. To read more visit our always free website at ipstrategic.com.

Continue reading Apple’s Shifting Congressional Priorities

Patent System “Gibraltar” Crumbling

The Pat Choate and Joan Maginnis IPW post relate patent reform’s sad history and statistical PTO proof of its on-going harm to independent lesser-resourced non-incumbents. Reduced to rubble, our once rock-solid “Gibraltar” patent system is crumbling. Unless we repel incumbent “raids” on invention and investment our economy will crumble with it. The startling numbers tell the tale.
To read more, please visit our always free website, ipstrategic.com.

Raid on Gibraltar: How the U.S. Patent System was Rigged Against Independent Inventor

“The numbers are stark. As recently as 1990, individual inventors were granted 17 percent of all patents. By 2000, they received 12 percent and only 6.8 percent in 2010. In 2015, individual inventors were granted only 5.8 percent of all patents.”

“In sum, if there is an example of a nation squandering its technological seed corn, this systematic weakening of U.S. patent protections for some “guy in the garage” is it. The great irony is that most of the people behind the screen in all this got their start in that same “garage.” They know this all too well, which is why they’re relieved to see the garage all but Closed for Business.”

Judge Michel’s Solution

Serving on the Federal Circuit since 1988, Paul Michel was Chief Judge from 2004 to 2010. He then retired so he could publicly address congressional patent reform pending then (and still). This year he appeared belatedly before Rep. Issa’s IP-subversive sub-committee. Had Congress heard him earlier our patent system’s self-inflicted harms might have been avoided. His focus now is saving it.

Judge Michel has injected welcome gravitas and urgency into twelve preceding years of circus-like congressional conduct staged to promote patent reform’s passage rather than its foreseeable impact. He emphasizes innovation’s need to attract private investment to achieve its public benefit. Had Congress heard him earlier, much of AIA’s damage to our patent system might have been avoided. Science talent, research investigation and innovation’s investors are now fleeing the US. Time is also running out. The issue now is how to save it. Michel’s comprehensive analysis and recommendations lift dangerously unfinished patent reform above the political thuggery of its past to the thoughtful rationality it deserves. Do not be deterred by its length. Not a word is wasted. Here is how it opens ;

“The American economy’s success depends heavily on invention. Our “Innovation Economy” requires adequate incentives to invest in innovation because most invention is very risky and very expensive. A well-functioning patent system provides the necessary incentive for securing such investments, both of company revenues and outside funding from venture capitalists, private equity firms, pension funds, commercial banks, and other similar sources. Of course, investors have many alternative investment options, and if risks are lower and rewards higher in other countries or in other endeavors such as entertainment, that is where investment funds will flow. Without the proper incentives provided by the patent system, investment in innovation will falter, and the U.S. economy will suffer.”

Supplemental Statement of Paul R Michel Sept 12 2017

The Time to Strike is Now

Citing congressional disarray and recent Trump triangulation, experienced Hill observers are urging pro-patent advocates to lobby NOW to pass the STRONGER Patent Act. They emphasize that it is the only patent measure pending and patent staffers familiar with Oil States’ pro-patent AMICI briefs have not yet read anti-patent opposition’s “public rights” responses (due Nov 1). Now, therefore, is the time to turn member and staff patent attention into a teaching moment. Add in NIH’s bipartisan $2 billion budget boost. Its recent congressional prioritization of life science commercialization has elevated the importance of returning private sector investment now deterred from participating in life science commercialization by weakened patents and the possibility of price-based Bayh-Dole march-in. Such R&D commercialization will be understood by members intimidated by the Act’s complex content. One need not understand arcane patent law to realize why TV’s “Shark Tank” investors insist on patent protection before they fund proposals.

Most important, Silicon Valley opposition to the STRONGER Patents Act has suddenly been back-footed on the Hill by a recent spate of negative publicity. Our earlier posts have chronicled expanding press coverage of the Valley’s disregard for personal privacy and intellectual property. Coupled with reports of persistent cultural misogyny, recent record lobbying expenditures and academic like “stink-tank analysis” are losing their former influence. Google’s dolphin-like “don’t be evil” persona now seems more shark-like.

The Hill is taking notice. Campaign support is always welcome but being caught in bed with Google is becoming dangerous. A recent “Buzz Feed” article entitled, “Blood In The Water in Silicon Valley” documents the Valley’s hidden thuggery. It is well-worth reader review. (Link found in our online article)

To read more click here.

A dozen years of patent holder beat-down are now seen by many as the work of unregulated digital incumbents unencumbered by pre-internet anti-trust anti-monopoly regulation. In the new environment, augmented anti-trust revisions are in order. Systematically leveraging their pervasive, platforms digital Goliath’s are crushing innovation. Expedient infringement, overblown troll narratives, and PTAB’s anti-patent bias are now seen as only parts of broader big tech economic abuse. We know Silicon Valley hostility to patents has been protected by a lazy press and member yen for campaign support. Now tech’s self-serving patent reform is more widely understood as only part of big tech’s broader bad behavior. The bloom receding from big tech’s rose is shifting the burden of Innovation Act persuasion to its promoters. As Buzz Feed’s biting piece concisely notes:

“This sort of political change happens slowly until it happens fast.”  

 Pro-patent advocates must act quickly to capitalize on what may be a temporary opportunity. Google and its anti-patent allies will not be defeated without our timely effort. They are smart. Their DC influence lingers, and still their money talks.

The pro-patent advocates’ immediate short term goal is passing the STRONGER Patents Act.

Longer term, a pre-internet anti-trust law designed to prevent rent-seeking pricing due to regional market concentration is no longer adequate. In today’s environment, geography matters less. Our economy’s new problem is its distorted evolution caused by organized deterrence of investment in innovation. Unsated by patent reform’s innovative suffocation, digital monopolists profit by prioritizing user access to favor allied service and product providers. And antitrust law aimed at increased consumer pricing falters when these giants’ lower prices long enough to kill potential rivals in their crib.

AIA’s patent enforcement lockout of lesser-resourced patent holders reminds us that big tech’s dodgy business practices are not confined to influencing DC policymakers. Patent reform has been part and parcel of a broader pattern to preserve monopoly pricing power. Digital behemoths talk about a better world, but their walk, including their version of patent reform, displays economic conduct calling for quick enactment of the STRONGER Patents Act.

Congressional Support for NIH Confirms Price Based March-in’s Madness

Six months after President Trump’s budget foundered in Congress its massive NIH cuts have not only been rejected, but lawmakers from both parties support a bipartisan bill that provides for NIH’s third consecutive annual 2 billion dollar increase to 36.1 billion dollars for the fiscal year beginning Oct 1, 2017. And NIH’s 30 % grant indirect expenditure provisions not only untouched, they were expressly preserved in the debt ceiling bill already signed by the president. The House is expected to agree to a similar amount.

The Senate bill expressly provides for a 29% increase in Alzheimer’s research, bringing the total for next year alone to 1.8 billion. This congressional vote of confidence in Dr. Francis S. Collins and his life science commercialization agency assures basic research funding will fill the commercialization bridge’s on-ramp for another year. And because commercialization is successfully traversing that bridge this action is an essential component of NIH’s mission.  It will help research universities ensure that the bridge’s off-ramp private sector-financed development funding will not be shut down by the enactment of any price-based Bayh-Dole march-in amendments expected to pop-up during floor consideration of budgetary measures as this session careens through its closing chaos.

Congress favors our existing life science innovation ecosystem’s search for cures as it stands. It is up to research universities to connect the dots by convincing their delegations that the cockamamie march-in measure favored by KEI President Jamie Love and his House and Senate water carriers will surely stand development of promising future research discoveries and any already in mid-stream.  Horrible as it is, Alzheimer’s disease is not merely a medical concern. Its hideous impact is widespread costing the nation almost 250 billion dollars annually. Political pressure for applying march-in price controls to any successful therapy, assures its application. Why? Because any price will be too high. Continue reading Congressional Support for NIH Confirms Price Based March-in’s Madness

Silicon Valley’s Version of Patent Reform Fits Its Suppression of Individuality

Xerox and Kleenex are brand names that became applied to their function. They are more recently joined by “Google” (search),”Amazon” (buy online) and “Zucked” (what Facebook did to Snap Chat). Acceptance of brand names to describe a product’s functional category signals success to the adopted brand’s providers. But it also can lead to acceptance that there is no need within that category to innovate further. Silicon Valley’s mega-techs understand this.Despite consumers’ entrenched brand/category conflation they continue innovating to ensure incumbency.

They are now actively deploying artificial intelligence (AI) to profile their customers better. They aim to convert users’ selection prerogatives from the users’ choice to unconscious adherence to their selection preferences. This data can then lead to increased ad-buyer pricing. As a frightening Washington Post article explains, “these companies are in a race to become our personal assistant. They want to wake us in the morning, have their artificial intelligence software guide us through our days and never quite leave our sides. They aspire to become the repository for precious and private data including our calendars and contacts, our photos and documents. They intend for us to turn unthinkingly to them for information and entertainment while they catalog our intentions and aversions. Google Glass and the Apple Watch prefigure the day when these companies implant their artificial intelligence in our bodies.” (see link below)

Using AI’s machine learning and big data big tech is reversing consumer initiated preferences to supplant them with their own.

“It’s hard not to marvel at these companies and their inventions, which often make life infinitely easier. But we’ve spent too much time marveling. The time has arrived to consider the consequences of these monopolies, to reassert our role in determining the human path. Once we cross certain thresholds — once we remake institutions such as media and publishing, once we abandon privacy — there’s no turning back, no restoring our lost individuality.”

This ongoing shift is evidenced in today’s politics by today’s echo-chambered amen corners where digitally-framed projected facts prevail over actual reality. More importantly, it describes the broader business context in which the same Valley players are so strongly anti-patent and why. This emerging concern can aid pro-patent advocates. To read more please visit our ipstrategic.com website.

Continue reading Silicon Valley’s Version of Patent Reform Fits Its Suppression of Individuality

PTAB Avoidance Sovereignty Redux?

Our patent system’s lawn party skunk has once again inspired creative avoidance. Asserting its tribal casino operating “sovereignty,” upstate NY’s St. Regis Mohawk’s Tribe and Allergan PLC have challenged PTAB jurisdiction with a deal designed to protect top-selling dry-eye drug Restasis (invented by pro-patent advocate Renee Kaswan) from potential PTAB nullification. The relevant patents expire in 2024. For the participants, it is a “win-win” wager. For PTAB not so much. The tribe’s plan is to convert present but less reliable gambling income to more stable royalties. It is betting 13.75 million dollars to obtain a $15 million annual slice of the drug’s ample annual royalties. Up to its eyeballs in generic drug court challenges despite Allergan’s admission that district court review is valid, the Restasis patent’s exposure to PTAB nullification bias is blocked. But PTAB carefully guards its patent killing prerogatives.

Unlike the UFL’s 11th Amendment jurisdictional escape, this thumb in PTAB’s eye is based on legal analysis of tribe’s state status as a sovereign government and PTAB’s past decisions. Both parties are betting against the odds. Worthy of casino involvement, the outcome is uncertain. Its first test will be at PTAB itself where past panels have been stacked to favor “the house” and decisions often veer from the predictability of precedent. Whatever its outcome however its court consideration is of interest to research universities. Continue reading PTAB Avoidance Sovereignty Redux?

Why Research Universities Must Act Now

As DACA, the “wall’ and Joe Arpaio hog our nation’s immigration drama’s center stage US research universities continue losing foreign-born research professors and students. It is easy to blame declining attendance on partisan politics, but five-years of descending US research university ranking deserve more sophisticated analysis. According to yesterday’s WSJ article, US Colleges Slip in Global Rankings:

“Oxford and Cambridge, the intellectual one-two punch of the U.K., took the first and second spots in the 2018 Times Higher Education World University Rankings. Their showing marked the first-year schools outside the U.S. seized the two top positions in the 14-year history of the list. The U.S., led by California Institute of Technology and Stanford University, took seven of the top 11 spots. But this also marked the fifth year of consecutive decline in the overall showing of the U.S. This ranking listed 62 U.S. schools in the top 200. In 2014, 77 U.S. universities ranked in the top 200. By contrast, the cumulative reputation of Chinese research institutions is swelling. In the latest ranking, seven Chinese schools cracked the top 200. In 2014, there were just two.”

How could this happen? WSJ readers quickly blamed; increased tuition, misplaced emphasis on PC safe spaces and a prevailing “party-hard” environment. But distractions from non-academic activity have roiled US campuses forever. Recent US research universities declining superiority deserves deeper analysis. Much of the decline may be attributed to comparative tuition costs. But blame for university community shrinkage is also attributable to AIA’s enactment five years ago.

Economic success in the Information Age depends on the quality of research universities’ resident communities. That, in turn, requires capacity to commercialize research output. Patent reliability must precede public investment in research and private investment in its promising results. Politically self-inflicted US patent degradation is pushing research talent and investor development funding to foreign shores. But don’t blame politicians. Blame ourselves. Research universities were “fooled once.” They cannot let themselves be “fooled twice.” Academic talent loss begets more talent loss which leads to lower ranking. Regaining former ranking thus gets harder every year. Many universities still stand and watch. Such restraint can only cause more decline. The past five years have proved it. The past is past but if we act we still can change our future. If not, to paraphrase Caesar’s warning to “dear Brutus,” the fault will not lie within our government but in ourselves”

Continue reading Why Research Universities Must Act Now