Most of us by now are familiar with the Coons Cotton Stronger Patents Act introduced a few weeks ago. If you have not yet caught up, it is a gem. At my Ipstrategic website, there are three levels of pertinent information including a sponsor press release and a summary of its provisions. We will not repeat them here. Suffice it to say that this artfully crafted proposed legislation restores much of the damage to our patent landscape recently inflicted by Congress and the Courts. It also addresses the troll issue in inappropriately targeted manner. The bill has intelligent bi-partisan backing. Until yesterday it had been the sole occupant of the center ring in the congressional patent law circus.
Yesterday Reps. Issa and House Judiciary Goodlatte initiated the Megatech response igniting a backfire in the House with a hearing designed to revive the tired troll narrative. Being in the majority, they selected three anti patent witnesses. Unfortunately for them, the one minority witness was Former Chief Judge Paul Michel whose knowledgeable testimony itself backfired on the Issa’s plan to counter the Senate bill. Judge Michel won the day with his deep understanding of patent law and policy. He made it clear that our patent system is in crisis and that patent restoration legislation must be enacted.
That means we now have to pass a bill over the objections of the incumbent mega techs and their Congressional water carriers. No small challenge! So far, the “politics” of this fight have gone their way. That will continue to be the case. Home state research universities themselves become a credible RESOURCE to their home state congressional delegations, by credibly explaining as Judge Michel did (see below) what is at stake and why it is important. Research universities can and must do so. Here’s why. . .
Continue reading Issa et al
We are seeing more negative press coverage of today’s digital dominance of our giant networked platforms who employ their free user-generated information to sell ads. Their natural monopolies do not trigger traditional anti-trust regulatory response because the anti-trust law is premised on concerns about consumer rent-seeking based on monopoly supported pricing power. In most circumstances, the consumer service and product pricing offered by these digital mega-techs is cheaper. But the anti-trust tide may be turning.The EU recently fined Alphabet (Google) for using its search dominance to boost sales of its other services. Newspapers are suing Facebook and Google over unlicensed use of their content. Even if these natural monopolies do not violate traditional anti-trust law, their leverage to benefit themselves in other areas even includes Congress and the US Supreme Court. One of their methods is to solicit academic support for their lobbying objectives.They have done so with arcane patent reform by academically validating their phony troll narrative. A long, well-researched Wall Street Journal article this week examined Alphabet’s (Google’s) practice of richly rewarding academic researchers whose “views” on policy just happen to support its DC lobbying agenda.
Continue reading AUTM and Google’s “Fake Views”
We are often asked by readers how to explain Bayh-Dole commercialization’s importance to Members of Congress when they know so little about patent law or policy. As is always essential to conducting any successful sale it helps to begin with where the customer is. Most members favor federal research and development funding known as “R&D funding” This is an approach that has worked for us. For the past ten years, federal R&D grants have been level-funded at $130 and 140 billion annually. NIH typically receives about $30 billion. Most members appreciate and value the work of NIH whose job it is to convert that funding into economic and medical progress. After setting aside approximately 10% for its research, NIH distributes specific project financing to research institutions and universities for peer-reviewed competitive research proposals. Such grants for basic scientific research may run from 2 to 5 years. Grants include creating antidotes to “super bugs,” cures for cancer, diabetes and presently incurable diseases like Alzheimer’s. Such research may have a promising hypothesis but it is not yet proven or enough advanced to attract private sector development funding. The government begins the process through federal grants, but the bulk of the risk and expense of moving it from lab bench to bedside is assumed in the private sector. Here’s how:
For the past ten years, federal R&D grants have been level-funded at $130 and 140 billion annually. NIH typically receives about $30 billion. Most members appreciate and value the work of NIH whose job it is to convert that funding into economic and medical progress. After setting aside approximately 10% for its research, NIH distributes specific project financing to research institutions and universities for peer-reviewed competitive research proposals. Such grants for basic scientific research may run from 2 to 5 years. Grants include creating antidotes to “super bugs,” cures for cancer, diabetes and presently incurable diseases like Alzheimer’s. Such research may have a promising hypothesis but it is not yet proven or enough advanced to attract private sector development funding. The government begins the process through federal grants, but the bulk of the risk and expense of moving it from lab bench to bedside is assumed in the private sector.
Continue reading Draft NIH
The public patent skirmishes between and among ICT tech titans are fought with weaponized patents stored and deployed to protect and promote market share in a fiercely competitive global consumer arena where its incumbents’ shelf-life is short. The press covers them because they involve the planet’s largest firms whose digital platforms have enslaved us all with necessary if non-understandable, dependency. Apple v. Samsung, Google v. EU, etc. are now the stuff of daily headlines. For ordinary folks, these billion-dollar battles about obscure technology describe and define today’s patent landscape. In this exponentially evolving global competition delayed market, timing compresses profits and threatens continued incumbency. Getting to consumer shelves first is more important than getting there lawfully. But this is not the only patent war raging at present. Enter efficient infringement.
These same squabbling incumbents also are at war on a second front — their decade-old version of patent reform. This war has been fought in publicly remote Capitol Hill jungles hidden beneath a canopy of public apathy. In this separate war, the battling consumer market digital platforms are allied. Their common cause is protecting their product pricing share from the power of patented component suppliers. In this war, their concerted objective is not global consumer market share. It is about how much of their final product sales price they get to keep versus how much they must share with their component suppliers. By weakening patents through congressional and SCOTUS revisions, they weaken component bargaining power while deploying their efficient infringer business model. Their common objective is to enhance their leverage. With the now public Apple-Qualcomm dispute, this formerly hidden second front has spilled into the open. And the press is covering it. Pro-patent advocates need to understand it.
Continue reading The Patent Wars
Pro-patent members of Congress who were on both sides of the aisle but were few and far between used to meet each year with a few proponent advocates to plan our defense against the big tech’s anti-patent annual onslaught. In 2013, a freshman member from Kentucky named Tom Massie appeared in our midst. He has numerous patents, is an MIT graduate, and completely understands tech transfer. A strong conservative he committed himself then and there to the pro-patent cause. He has been working the House floor itself ever since carrying his whip list in his pocket. Collectively we owe a lot to Rep. Massie. He is a firm believer in direct personal telephone contact with home state delegations, especially by universities. A few weeks ago, as a keynote speaker at an Eagle Forum Memorial dinner celebrating the relentless past pro-patent advocacy of its founder Phyllis Schlafly he described pro-patent life on the Hill as a member. Gene Quinn who was also at the dinner arranged a future meeting with Tom which resulted in an IPWatchdog interview.
Tom tells it like it is on Capitol Hill and offers common sense suggestions about making our Hill contacts count.
The opening lines of the press release announcing the introduction of the Senators Coons’ and Cotton’s STRONGER Patents Act (SPA) emphasize the bill’s important economic impact. They understate the bill’s breathtaking legal impact which is set forth in two other summary documents linked in the release; a “one pager” and a “two-pager.” Both are concise and must read. They reveal a masterpiece of common sense content designed to restore our once gold standard patent landscape to its former greatness. All three important documents are linked below. Here is a preview:
Among other things, SPA’s enactment would end PTAB’s reign of terror over lesser-resourced inventors and disruptive technology by harmonizing its burden of proof and claims construction standards with those of the district courts restoring patents’ presumption of validity while confirming patents’ property rights. Its put-up-or-shut-up one-time PTAB claims nullification process, its standing requirements and its meaningful estoppel provisions will help curb routine and abusive misuse by efficient infringer defendants against under-resourced early stage innovation. There are more equally important provisions.
Continue reading STRONGER Patents Act – a Masterpiece
Before the long weekend ahead we want to call your attention to two hurdles ahead as Congress considers the Coons-Cotton STRONGER Patents Act and SCOTUS considers PTAB’s constitutionality in Oil States.
When our Founders expressly established patent rights in the Constitution they underlined the document’s unique establishment of a new and different sovereignty for the US. It was to be vested by the people in a Constitution not by a deity in a king. Patent property rights were expressly defined and vested in the inventor whose labor produced it and were no longer subject to a royal grant or withdrawal pursuant to the king’s sovereign whim. Like the Constitution itself, patent property rights were based upon the property theories of John Locke. Congress was given the power to codify them but Congress could not completely cancel, replace, or repeal them by completely denying their exclusivity. In short Congress could set a time limit but could not do so in a way that allowed for no time at all to securely exercise the rights conferred.
By characterizing these constitutionally-established rights as “public rights” for their entire term anti patent advocates aver that Congress can amend their term. But even if that was the Founders’ intent because of the words “secure …for a limited time” Congress cannot eliminate them entirely. Nor can Congress create an administrative agency like PTAB by which PTO’s administrative examination powers enables PTAB to nullify those rights all the way to and through the end of a patent’s term. PTAB’s nullification powers up to and through the final nanosecond of a patent’s entire term is contrary to the express words of the Constitution.” Secure for Limited Times” cannot mean for no time at all. This matters because unless parent rights are property rights in which ownership can become settled for a limited time such patents cannot support investment in commercialization. Gene Quinn provides further chapter and verse in a link below.
In another recent IPW post pro-patent all-star Paul Morinville, describes Google-bro Issa’s recent smarmy dismissal of Professor Adam Mossoff’s property rights testimony and explanation of what is now referred to as the China syndrome as the Asian powerhouse strengthens its patent system while weaken ours. Apparently preferring re-election support from Google and friends, Issa (who just won a close election in a recount) stands firmly on both sides of the property issue. In Paul’s description of a recent hearing, Issa first champions patent property rights but later mocks Professor Mossoff’s refutations of proponents’ support of patents as public rights. As Judiciary Chairman Goodlatte’s anti-patent poodle, Issa can be expected to block (or even adversely amend) much-needed pro-patent progress in the House during this unusual session. If Senator Coons’ STRONGER Patents Act clears the Senate, Issa will do what its takes to sabotage its passage in the House.
Both obstacles are not insurmountable but they are formidable. Please take a moment to read Gene Quinn’s take on choosing a “patent as property” PTO Director and Paul’s post describing Google tub-thumper Issa’s oily duplicity on the issue and the China Syndrome. They both are linked below. Continue reading “Secure for Limited Times” Can Not Mean No Security Ever
Below is an excerpt from an outstanding Kevin Madigan essay summarizing the problems plaguing development investment in what was once our gold-standard US patent system. Madigan explains why development investment needed to commercialize US inventions and life science discoveries is now heading overseas. Madigan’s description of the situation is spot-on. His description of this alarming situation is spot-on, and his links are reliable and helpful. Lincoln’s famed reference to the investor’s “fuel of interest” supporting the inventor’s “fire of genius” poetically describes the commercialization process. More prosaically, after Congress appropriates its R&D funding, commercialization is where that federal funding rubber meets the road. This essay is about real statistics, sound reasoning and reliable links to opinions of patent policy experts. It demonstrates the economic importance of the Oil States case pending at SCOTUS and passage of the Coons/Cotton STRONGER Patents Act.
“Venture capital investment in the United States has declined steadily for years, as investors abandon an uncertain domestic climate for more reliable opportunities in foreign countries. In a report on the current state of the entrepreneurial ecosystem, the National Venture Capital Association emphasizes the extreme decline in the US share of global venture capital in the last twenty years, highlighting a drop from 83% of global share in 1996 to just 54% in 2015. At a time of decreasing investment, the US should be working to improve its innovation ecosystem, providing stable and effective property rights to inventors so that VCs can once again feel confident that investments in startups’ R&D—secured by patent rights—won’t just be stolen by established and better-financed infringers. Unfortunately, its doing just the opposite. Over the past decade, the US has continued to gut its patent system of the protections and incentives that attracted investment and made it the world leader in cutting-edge innovation in the first place.” Continue reading Investment Moving Overseas
Despite its Alphabet’s (Google) motto “Don’t be evil”, the EU has just tagged them with a 200+ billion dollar fine for abusively using their search service to prioritize preferred listings .
Like the other four giant digital platforms whose wealth, power and data enormity are invitations to abuse their virtually users, Google will dispute the EU fine (and its additional order giving Google 90 days to present their plan to reliably clean up their act)
On its surface, this news item may be of remote interest to TTO’s and US patent holders. But as foreign venues clamp down on big tech their need to maintain bottom-line growth may heighten their abusive conduct here in the US. US Pro-patent interests are painfully familiar with the political clout of the big tech oligopoly. Will the US follow EU’s lead? So far Congress and SCOTUS are allowing themselves to be persuaded by big tech’s words, not their deeds.
At AUTM’s excellent presentation before a standing room only crowd of Hill staffers yesterday, Steve Sasalka referenced the US Chamber’s recent US 10th place world rating of patent strength. This is the result of recent anti-patent activities by Congress, the Courts, and the past administration. The AUTM panel outlined the latest reports
commissioned by AUTM and BIO showing the economic contributions of research universities. Steve was flanked by two startup panelists whose operating technology was based on academic research. Both were quiet, straight forward entrepreneurs, clearly not Hill advocates and were thus very persuasive. One of them startled this listener however when with calm and matter-of-fact earnestness he said that Europe was now a preferred patent venue over the US.
Continue reading AUTM’s Report Breaks Through the Fog on the Hill
PTAB now appears to have gone “rogue” – a term originally applied to domesticated elephants that suddenly would become destructive, but is now appropriately applied to PTAB. In the post excerpted below, IPW’s Steve Brachmann and Gene Quinn precisely outline the administrative tribunal’s recent rejection of some district court decisions with jury verdicts confirming VirnetX patents’ validity. Such Article I outrage needs no further elaboration for us.The excerpts below from the IPW post are alarming. The post itself is bone-chilling.
“So obviously the patent claims VirnetX has used to pursue infringers such as Apple and Microsoft are not the weak patents that opponents of the patent system claim are the scourge of the system. Well — not so fast! Just because an Article III federal district court confirms the validity of a patent doesn’t mean anything anymore. Indeed, federal courts have become subordinate to the PTAB, which is as ridiculous as it sounds but sadly true. A patent is not valid until an Article I executive tribunal says so, and absolutely no deference is paid to Article III judges of the United States federal courts.”
Continue reading Has PTAB Gone Rogue?