Patently-O Bits and Bytes No. 87

  • For the first time in history, fewer than 50% of US patents issued in the past year originated from US applicants. [Zura] IBM received 4,000+ patents in 2008.
  • In 2007, I asked the question: How will the US patent lobbying change when most new patents are held by foreign companies?
  • Brian Moriarty and Deirdre Sanders (Massachusetts patent litigators) discuss the combination of the Texas Venue problems (TS Tech, VW) and new D.Ma. local patent rules. Their conclusion: “Patent Suits – Massachusetts In, Texas Out.” [LINK]
  • More Patent Jobs:

    • Godfrey & Kahn (Milwaukee) needs an “IP Generalist” with “excellent academic credentials” to help with litigation, trademarks, patent prosecution, and transactions. [Link]
    • Baker & Daniels (Indy) needs a MechE (or mechanically inclined equivalent) associate to handle patent prosecution. [Link]

30 thoughts on “Patently-O Bits and Bytes No. 87

  1. Mr. French says, “Canada’s patent system is effectively a mechanism by which the government grants certificates to foreigners authorizing foreigners to withhold from national industry 90% of new developments in world technology as they arise.”

    That’s only half the story. Canadian companies and inventors participate heavily the in US patent system. When you take into account the huge gap in populations (300M v 30M), it’s likely a wash.

    On top of that, countless “foreign inventions” are never patented in Canada because of its relatively small market. So while national industry is blocked like you say from some new developments, the majority are only patented in the large markets (US, Europe, etc), and thus free to use in all of the small markets (Canada).

    Given the ratio of patents granted worldwide v patents granted in Canada, I think Canada, or any other small market, nets a huge amount of free technology.

  2. “But, ironically, in mainland Europe, the canny little guy/gal with a valid claim can get, for a relatively small number of bucks, a proportionate injunctive “bang”. S/he won’t get damages in the multi-million range, but she might well turn a profit.” wow, “turn a profit”!

    Max, taking money from foreigners = self-delusion. Because inventors are only entitled to “turn a profit”.

    Americans want the upside of inventing new industries & *creating* *the* revenues & the optimal margins associated with innovation -

  3. “Canada’s patent system is effectively a mechanism by which the government grants certificates to foreigners authorizing foreigners to withhold from national industry 90% of new developments in world technology as they arise.”

    Nice try. You think 90% of “new developments in world technology” are patented?

    More like 1%, and that’s probably a giant overestimate. So much for the mystery of Canada. At least in Winnipeg, I can swing freely from side to side on my swing set.

  4. David French writes:

    It has finally happened, after 200 years, foreigners have now obtained more patents in the United States than issued to Americans. The year 2008 was a turning point not only for the realization by American consumers that the looming threat of Peak Oil was going to drive-up the cost for fueling their cars. The year 2008 was the year when the US patent system started to slip out of control of loyal American business enterprises.

    Consider this as an interesting definition of a patent system: A mechanism by which the government grants certificates to foreigners authorizing foreigners to withhold from national industry the greater part of new developments in world technology as they arise. From now on, this definition will apply to the United States patent system.

    Welcome Americans to the world of the future! Many countries around the world have had foreign dominance as a characteristic of their patent system for decades and decades. America has been instrumental in campaigning for the ground rules that make this possible. Representatives from the United States were key participants in the original international conference leading to the Paris Convention on Industrial Property of 1883. That multilateral treaty laid down the ground rules that all members had to accept patent applications from all member countries. There could be no discrimination on the basis of nationality: “National treatment for all”.
    These principles worked particularly well for America over the last 1 20 years. America has been a fountainhead of innovation and inventive creativity. Americans have been filing for patents in countries around the world, and in some cases dominating those national patent systems.

    Canada has a 90% foreign participation in its patent system. Half of these foreign applications come from inventors who are residents of the United States; the other half are inventors who are resident in other foreign countries. These statistics are based on the residence of the named inventors, usually the first named inventor. But we may generally infer that most commercially relevant inventions will be owned by corporations, typically the employer of the inventor.

    What has been the effect on Canada of foreign dominance in the Canadian patent system? Nobody really knows for sure. The whole premise of the patent system is that new ideas are hard to introduce into the market. Patents last for 20 years from their filing date. It’s possible that the some 25,000 or so patents obtained yearly in Canada by foreigners represent technological innovations that either will never see the light of day, or will only see the light of day if supported by a temporary monopoly. Nevertheless, it is still true. Canada’s patent system is effectively a mechanism by which the government grants certificates to foreigners authorizing foreigners to withhold from national industry 90% of new developments in world technology as they arise.

    This is not the situation in the United States. As of the end of 2008, US patent office certificates issued to foreigners only cover 51% of new developments in world technology (that rise to the level of meriting the granting of a patent). But the arrival of this predominance by foreigners within the US patent system simply represents a stage in an ongoing trend. Once long ago Americans totally dominated their own patent system, obtaining even as much as 90% of the US patents being issued. But the trend is inevitable. The American patent system is heading in the same direction as that in Canada in terms of foreign participation.

    Over the last 120 years the US patent profession and many representatives of US industry have touted the US patent system as an “engine of creativity”. Abraham Lincoln has been much quoted for his declaration that: “The patent system… added the fuel of interest to the fire of genius, in the discovery and production of new and useful things.” Well the beneficiaries of that fuel will, increasingly, the foreign-located corporations.

    This cannot be a surprising development for those who think thoughtfully about world developments. In fact, it is part of the Unseen World War that is taking place around us at this very moment. What is that World War? It is the war to win consumer dollars. It is the war to sell product in the marketplace. In the new scenario of globalized world trade, it is not enough for a corporation to be as good as its competitors. It is not enough for it to be better than its competitors. A company has to be getting better faster or…… eventually, competitors will catch up and surpass them. That is the event that is finally unfolding.
    What does this augur for the future? Well, it looks like the rat race of trying to stay affluent is here to stay, and will continue with a vengeance. If GM makes a good electric car and Toyota makes a better one, who is going to make the sale?

  5. ….from which point, Erez, there’s still a million miles to travel, mentally, before the objective hindsight-free EPO-PSA penny drops. I’m adamant that EPO-PSA is like learning to ride a bike. Everybody thinks it’s a piece of piss, and they understand it fully, and they can do it in their sleep. Then they try. And fall off. Sometimes, after much trying, they finally get the hang of it. And wonder how they ever had a difficulty with it. A vital difference between bike-riding and PSA-surfing is that you don’t need any help, when learning to ride a bike, just perseverance. With EPO-PSA, you need tuition. Not much. Half an hour should do it. But frustratingly few are privileged to receive that vital 30 minutes. The situation is rendered more complex by the fact that litigators in Europe are outside the circle of those who understand EPO-PSA, but more assiduous, in coming forward to lecture, all round the world, on behalf of Europe. Much as they crave it, European litigators don’t do much inter partes stuff at the EPO, the killing ground where issued patents are dispatched to oblivion, for all Europe, with EPO-PSA the mode of execution.

  6. I don’t want to be off-topic, but the inspirational part of Eisai is on page 8:

    “The Supreme Court’s analysis in KSR thus relies on several assumptions about the prior art landscape. First, KSR assumes a starting reference point or points in the art, prior to the time of invention, from which a skilled artisan might identify a problem and pursue potential solutions. Second, KSR presupposes that the record up to the time of invention would give some reasons, available within the knowledge of one of skill in the art, to make particular modifications to achieve the claimed compound.”

    and

    “a prima facie case for obviousness for a chemical compound still, in general, begins with the reasoned identification of a [prior art] lead compound.”

  7. Sorry to disappoint you Erez. The problem with sarcasm on this blog is the heterogeneity of the readership. You don’t know, when you use it, what will happen next. I vaguely remember Eisai. It went on about some molecule being the lead candidate, didn’t it? I took that to be ubiquitous, in pharma cases. But don’t remember in it anything rising to the level of “adopting”. Thankfully, it is common enough to find Decisions that are compatible with PSA (because PSA, correctly executed, always gives the “right” result) but I have yet to see a Decision that reveals the court to be “adopting” PSA. Can you be more specific, maybe?

  8. Max, you disappoint. The English are supposed to a people who appreciate sarcasm.

    By the way, have a look at the recent CAFC decision Eisai v Dr.Reddy, it will make you happy.
    It seems the judges adopted the PSA.

  9. Looking in from outside, Bent, I marvel at the capacity of Americans for self-delusion. They assert that, in their society the little guy is king, despite having had for ages a system that gives him virtually no chance. In Europe, everybody starts from the proposition that the patent system is like a Rolls-Royce: if you have to ask how much it costs, then it’s not for you. But, ironically, in mainland Europe, the canny little guy/gal with a valid claim can get, for a relatively small number of bucks, a proportionate injunctive “bang”. S/he won’t get damages in the multi-million range, but she might well turn a profit.

  10. Many small businesses in America woke up some time ago to the fact that the US Patent System is currently a rigged game, and between the PTO and the courts, odds of winning are very small. I am aware of many businesses, some with some great inventors with lots of patents in prior years, that have elected to sit out from the patent process (at least until things change). The will license what they can as trade secrets, and spend their resources on marketing or manufacturing improvements, keeping as much under wraps as possible. With the current USPTO rejections often requiring detailed responses that cost as much or more than preparing and filing applications, much less onorous appeal rules (at least temporarily stayed) if you have to go there, there is no question that those decisions are just another data point, now reflected in patents issued, that the system is flat broken. Wonder how long it will take foreign applicants to come to the same conclusion ?

  11. Does it say that Chaon? Isn’t it the least developed countries that have the biggest proportion of their patents being owned by alien corporations? Are these underdeveloped countries exhibiting a market with your wishful pre-eminent “strength and importance”? Actually, a 50% domestic/alien split is healthy. That at least is the balance in comfortable-with-itself mainland Europe.

    And Mr Gur, I’m a bit doubtful about “ideas”. I would prefer it if the Office you envisage could recognise as a motor for innovation only those new and non-obvious “ideas” that come supported with an enabling disclosure that is commensurate in scope with the immensity of the written definition of the “idea”. As we all know, having the idea is the easy bit. It is reducing it to practice that’s the tough bit. “Free beer” is a good idea. How to realise that idea is a problem that nobody’s cracked yet. Granting 20 years of exclusive rights for “free beer” claims is a very bad “idea”.

  12. I have a way to encourage US scientists and engineers.

    The US should establish a federal office where the scientists and engineers present their ideas.

    The office will evaluate the ideas and conclude that these ideas are old and/or that anyone could have come up with these ideas if they wanted to.

    This will surely increase motivation.

  13. “Doesn’t this fact say a lot about the strength and importance of a United States Patent internationally?”

    It says a lot about the strength and importance of the U.S. market.

  14. Hello Noise. I just learned something, from your response, namely, that “America, Inc. means “Big (US) Corp.”. I had thought it meant “The economy of the United States of America”. What are British politicians, and members of the British Royal Family mean, getting at when they talk up the UK as a tourist destination, saying that they are speaking on behalf of “UK, Inc.” I had always thought that had little to do with the interests of “Big Corp”. With its owners distributed all over the world, these days, Big Corp no longer owes its loyalty to any particular national interest. It’s a stretch, isn’t it, to equate “America Inc” with “Big Corp”.

    So, we are at cross-purposes, about what I wrote above. It was inspired by 1) my impressions of how some other countries might choose to run their patent systems: broad protection for patent holders who are domestics, but possibly a somewhat narrower scope of protection, if the patent owner happens to be from another country, and 2) the progression from warlord to peer of the realm, from t3rr0rist to statesman; and from nation of copyists, to nation of innovators.

  15. “Like allowing Beauregard claims to be patentable?

    It was selfish and short-sighted, wasn’t it?”

    Just like me when I make any one of my garbage posts.

    /posing as a m0r0n off

  16. “fewer than 50% of US patents issued in the past year originated from US applicants”

    Therefore, if you want to increase your odds of obtaining a US patent, become a citizen or incorporate in a foreign country before filing.

    /statistics wanker off

  17. Now that most patents are going to foreigners, maybe the true contribution of America’s patent bar to the economy will finally be recognized: we are helping, in our own teeny tiny way, with America’s balance of trade/foreign accounts problem.

  18. “For the first time in history, fewer than 50% of US patents issued in the past year originated from US applicants.”

    Am I missing something? Doesn’t this fact say a lot about the strength and importance of a United States Patent internationally? Sure, we could all write volumes about the problems of USPTO policies. But the fact that more and more patents are granted to foreign companies only strengthens the value of a US Patent.

  19. “The PTO is a mess -pure and simple and their failure to follow the Law, along with their attempts to grab and change the Law are for purely selfish reasons”

    Like allowing Beauregard claims to be patentable?

    It was selfish and short-sighted, wasn’t it?

    I don’t recall a big outcry from inventors, however, when they started allowing those claims.

    Huh.

  20. MaxDrei,

    Very wrong on several points.

    The PTO is NOT thinking of the national interest when they fail to follow the law. There is no twisting you can do to legitimately couple those two concepts. The so-called filtering that you refer to to is the smokescreen that you mistakenly are buying into. The PTO is a mess -pure and simple and their failure to follow the Law, along with their attempts to grab and change the Law are for purely selfish reasons and have NOTHING to do with actually promoting the national interest.

    The patent system is NOT for America Inc. Never was. It is for the inventors. Yes, America Inc. uses and will continue to use the system. There is nothing wrong with that. But it is also America Inc. (for example – the coalition for patent fairness) that wants to wreck the patent system and make it weak.

    A strong system does NOT rule out a fair chance to dispose of meritless assertions. You are buying into the Patent Troll smokescreen. A strong system IS a fair system. The two are not mutually exclusive. Any so-called troll who has a legitimate property right from a patent (doesn’t matter if that right was purchased, developed or if the entity is practicing or not) has the LAWFUL right to make the most out of that property. Don’t buy into the Evil Troll crap.

    I recognize that sometimes you throw up subjects just to rile a debate, then sit back and learn from both sides’ responses. However, much like the opening tip-off in basketball, you get a better result when your initial throw is fair and straight and not leaning towards one side (in other words, try not to buy into the hype in your initial instigations).

  21. So, that’s sorted then. The USA is just like Europe: not enough students doing “hard” subjects. Quite unlike India and China. NOW: Back to the thread. What about Dennis’ question? Remembering how, 10 years ago, Korea had very few US patents but now has a zillion, ask, how many will China be taking, 10 years from now. Then ask: 10 years from now, will America, Inc. still want a “strong” US patent system? Maybe, instead, America, Inc. want one that gives the party charged with infringing a ridiculous claim (ie YOU) a fair chance to dispose, economically and fast, of that meritless assertion, filed in your local district court by the alien with the big factory in your neighbourhood. Oh and by the way, you will surely be yearning for a PTO that really does filter out the trash, and the over-broad claims, before they get to issue. Come to think of it, the PTO is way ahead of you, already thinking of the national interest.

  22. “until companies start treating engineers as something more than fungible cubicle monkeys, the US’s contributions to science and technology will continue to decline.”

    excellent point, Lowly.

  23. “Such an interest will get one made fun of in high school and will ensure 4 years without any hot teen poon. ”

    My HS must have been arse backwards, most of the “cool” kids were also the “smart” kids. But then, I’m from the backwoods.

    But you are right about lack of hot teens being a major problem about being one of the nerdy smart people.

    “Where are top brains in the US go? ”

    Lol foreigner.

    “Considering the difficulty of the schooling, the pay is crap. Career advancement sucks – considering the level of skill and training a highly experienced engineer has, the pay is crap. Job security is crap. ”

    I agree with you there, except the security in my field isn’t that bad. And there are some companies where there is a lot of room for advancement. Schlumberger, and some other oilfield services aren’t bad. But, you have to go live in the jungle/desert. :(

  24. I have never heard of a political science major say “this major is so difficult and/or time consuming” that I am switching to engineering or a hard science major.

    But I heard it plenty from engineering and hard science majors.

  25. “Where are top brains in the US go? My guess is they go to law schools.”

    Eh. Most lawyers I know would have failed miserably out of any engineering program, no matter how smart they are.

    Most lawyers don’t have the acumen for math and science to enable them to become engineers. Most engineers lack the verbal skills to be a lawyer.

    I think there are a couple factors at work today. The problem with no science grads is that, in the us nowadays, it’s not “cool” to be intelligent or interested in science/engineering. Such an interest will get one made fun of in high school and will ensure 4 years without any hot teen poon. Therefore, some kids who might otherwise have the interest and the ability never find out that they do.

    Another problem is that engineers are treated poorly in the workplace. Considering the difficulty of the schooling, the pay is crap. Career advancement sucks – considering the level of skill and training a highly experienced engineer has, the pay is crap. Job security is crap.

    Until kids aren’t made fun of for being interested in math and science, and until companies start treating engineers as something more than fungible cubicle monkeys, the US’s contributions to science and technology will continue to decline.

  26. “For the first time in history, fewer than 50% of US patents issued in the past year originated from US applicants.”

    It is only a matter of time, sir.

    My daughter had her EE Master orientation in USC. Out of 100+ students, 95% are foreigners.

    Where are top brains in the US go? My guess is they go to law schools.

Comments are closed.