Guest Post: Selectively Targeting the Patent Troll Problem

Over the past two years, a number of legislative proposals have been proposed to address the perceived problem of “patent trolls.” A common problem of the proposed reform mechanisms is that they would result in broad reforms against all patent owners rather than specifically targeting problematic elements. For those with general anti-patent bent, that result may be acceptable. However, the pro-patent lobby remains strong enough to ensure that congressional reforms will not completely eviscerate the system. In his guest post below, Mr. Shah outlines his proposal for reforms that more selectively target patent trolls. – Dennis

Guest Post by Varun A. Shah, Head of IP Development for Aruba Networks.

The Innovation Act was a great attempt at solving the patent troll problem for the Information Technology industry. For example, the Innovation Act proposed heightened pleading standards for asserting patent infringement. However, the Innovation Act is now stalled in Congress, in part, due to the rejection by the Pharmaceutical and Biotech industries of new requirements for enforcing patents such as the heightened pleading standards. A solution is needed that solves the patent troll problem for the Information Technology industry without reducing the patent assertion rights of the original patent Applicant, i.e., the innovator.

I propose modifying the Innovation Act to require heightened pleading standards only if the current patent owner is not (a) the original Applicant or (b) an assignee that the Applicant is obligated to assign to at time of filing. In other words, only third parties (e.g., patent trolls or middle men) that acquire the patent would be required to follow the heightened pleading standards for asserting patents. Similarly, other patent rights, damages, and requirements for patents would depend on whether or not the current patent owner is (a) the original Applicant /an assignee that the original Applicant is obligated to assign to at time of filing or (b) a third party that acquired the patent. In case of legitimate business spin-offs (that are not primarily a patent sale), the business spin-off or acquiring company would hold the same rights as the original Applicant, and would not be subject to heightened pleading requirements for asserting patents.

This proposal reduces the patent troll problem for the Information Technology industry without reducing the patent assertion rights for the original patent Applicant. More generally, this proposal will protect the interests of all innovators that actually generate the ideas/patents while partially diluting the value of the patents if commoditized and transferred to others that are abusing and burdening the patent system. This re-structuring of patent value is in-line with the true goals of the patent system, i.e., the promotion of innovation.

= = = = =

Mr. Shah suggests that those who care about these ideas should contact the policymakers: Senator Leahy, Representative Goodlatte, and the White House Office of Science and Technology Policy (OSTP).

119 thoughts on “Guest Post: Selectively Targeting the Patent Troll Problem

  1. Another proposal in a somewhat similar vein is to use the current owner’s/assignee’s relationship to the original assignee as the basis for either requiring or not requiring some form of “compulsory” license in the event that a patent is not being worked.

    In this type of arrangement, if a patented invention is not being worked, then:

    (a) if the current owner is the original assignee (or a subsidiary, acquirer, etc.), then no licensing is required;
    (b) if the current owner is not the original assignee (or a subsidiary, acquirer, etc.), then a form of compulsory licensing is required at a predetermined royalty rate.

    Note that this is not a perfect plan, so I expect there will be objections. But the underlying idea is that it reduces the incentive of NPEs to acquire patents simply for the sake of assertion, while not creating a disincentive for research institutions or other forms of corporate R&D to develop inventions, since they are not required to license if not using the invention.

    Reply
    1. Alan, may I suggest that funding R&D through patents is legitimate. May I further suggest that funding startups based on their patents is legitimate and that failure to enforce those patents if a startup fails is more than counterproductive to patent system.

      Next, what is wrong with law firms that specialize in enforcing patents. There are defense firms galore. Just as in the insurance industry, there are defense firms and firms that represented the injured.

      Nothing is wrong with this model.

      The ownership of patents to be enforced in an LLC is for tax purposes. The real relationship to be looked at is the licensing firm/law firm and the client, the failed startup or inventor, or Big Corp who are monetizing Rembrandts in the attic. All of this is legitimate.

      The sole problem anyone has EVER identified is has to do with using the high cost of litigation to enforce shaky patents. Focus on litigation abuse. Focus on better patent quality.

      After the two Supreme Court cases on attorneys fees this term, the tool to prevent litigation abuse has been restored to the district courts. One aspect of the problem has been solved.

      Now let’s focus on the second: patent quality.

      Job number 1: get rid of business method patents.

      Job number 2: stop functional claiming.

      Reply
    2. “compulsory” license in the event that a patent is not being worked.

      Another excessively BAD idea.

      Reply
  2. Another proposal in a somewhat similar vein is to use the assignee’s relationship to the original assignee as the basis for either requiring or not requiring some form of “compulsory” license in the even that a patent is not being worked.

    In this type of arrangement, if a patented invention is not being worked, then:

    Reply
  3. Steve: the unconstitutional idea of trying to make a legal distinction between different types of patent-owning entities

    There are already thousands of rules and laws that make distinctions between “different types of patent-owning entities”.

    How in the world would this ge neral concept be deemed “unconstitutional”? Do you believe there are no rational bases by which to differentiate between different behaviors by different entities who own patents?

    Reply
  4. Ned: define “troll.”

    I think there’s plenty of definitions floating out there that at least some substantial fraction of the public would find acceptable, perhaps with some additional tweaks.

    Let’s start with this one (seem like we’ve been through this before, several times, at least….): an entity that is not practicing the asserted patent and has no bona fide intention of practicing the asserted patent, wherein said entity’s primary use for patents or primary source of income is the ge neration of revenue by licensing or litigation of patents, and wherein the entity is not a public or private institution engaged in substantial scientific research or science education.

    Some will complain that this definition unfairly “discriminates” against those wonderful patent agent/lawyer types who, seeking to “make some money off the Internets”, create shell companies and “innovate” computer-implemented jnk for the purpose of specifically targetting business and/or individuals (large and small) known to be more prone to settle with patent trolls. To the extent that’s true, that is a feature, my friends — not a bug.

    In any event, it’s just a starting point. There’s really no reason that the class of actors (or actions) that society wishes to curtail here can’t be identified with constitutional clarity. It’s not as if we’re trying to prevent sincere realigimous people from discriminating against women or something abhorrently unconstitutional like that.

    Reply
    1. MM: “and wherein the entity is not a public or private institution engaged in substantial scientific research or science education.”

      Big Co. and Big U package their patents to licensing entities that fit your definition of a troll.

      Note also, under you formula, that failed startups and individual inventors are prevented from hiring licensing firms to help them if they do not retain any ownership interest. But startups need the ability to enforce patents on their failure in order to obtain financing in the first place.

      See the problem? By trying to define troll in the way you did, you soon see that the definition begins to undermine the central purpose for the patent system – to fund innovative research.

      I

      Reply
      1. “fund innovative research”

        I don’t think “funding” is a “concern” for some people…. they just want “innovation” to causelessly occur… how? Who cares.

        For them, the ends justify any means.

        Reply
  5. Ah, so you want Congress to pass laws that adversely affect the rights of others that you have labeled as disfavored, but not your rights.

    Mr. Shah, I think the “targeted reform” that people are talking about means targeted at the abusive behaviors , not targeted at the people you think deserve fewer rights than you.

    Reply
    1. Thank you for your comment. I am not making a claim as to any particular entity deserving more or less rights. My proposal is a shift in value and patent assertion rights. Although the proposal refers to patent trolls as an example of a burden on the patent system, the proposal does not discriminate against any particular entity. The proposal is driven by a basic principle that an innovator should be given latitude in protecting his or her idea, while a patent acquirer who typically pays for the patent should also pay to prepare an infringement case fully before suing others. The additional hurdle for any patent acquirer applies regardless of whether the patent acquirer is a patent troll or an operating company. This measure necessitated by the abuse of the patent system has to be weighed against the benefits provided: maintaining the integrity of the patent system as well as promoting innovation, the main goal of the patent system.

      Reply
      1. Patent assertion rights are a basic component of the property that is to be freely alienable by design. Under this basic system, attaching strings to the “who” regardless of the “what” is de facto discrimination.

        You are incorrect in your assertion that no “particular entity” is targeted, as you target an entire class of entities of a particular kind: the kind that would wish to engage in a basic and fundamental aspect of the system: those that wish to partake of the freely alieanable nature.

        You appear to want to dress up this in righteousness, when it is not righteous. Your attempt at preserving integrity is akin to a doctor killing a patient while curing the patient, and saying, well, at least he is not suffering any more.

        Alienability.

        Look into it.

        Reply
  6. A critical factor to keep in mind (and absolutely forgotten by Mr. Shah) is the bedrock consideration (and avowed purpose) of the patent system of full alienability of property.

    Proposals such as this that seek to place restrictions SOLELY on the “who” of ownership completely untethered to the “what” that is being owned need to align with – not contradict – foundational reasons for the system.

    Not only is this unbridled discrimination, the attempt by Mr. Shaw here to paint this as an “improvement” ignores the fact that the inclusion of this possibility in te prior legislation efforts was one of the critical faults of that legislation.

    This is an offensive fail from the start.

    Reply
    1. Beyond that, what about somebody who files for a patent in his own name and then later decides to start a business (and assigns the patent to it)?

      Technically that new company is neither a) the “original applicant” nor b) an obliged assignee at the time of filing.

      And provisions/exceptions regarding “active commercialization” don’t help either – as they leave out small startups who haven’t raised enough funds to launch.

      Reply
      1. This is analogous to quibbling over the definition of who a “criminal” is … pointing at this type and that type of person… all the while forgetting that commission of a crime is fundamentally essential.

        Here the acts of some “so called” trolls are what the focus should be… not a class of entity.

        Reply
        1. Here the acts of some “so called” trolls are what the focus should be… not a class of entity.

          The underlying concern is asymmetric warfare where the patent holder, by virtue of the fact that it is not in the business of producing anything substantial other than, possibly, more patents and patent lawsuits, has nothing to lose and everything to gain by asserting the jnk patent against anyone who might, for whatever reason, pay up.

          This is done in the context of a judicial framework which, in its short-sighted mindless efforts to coddle patentees, rewards such behavior by making it more difficult to tank a jnk patent that has been licensed!

          Given these facts, it’s impossible to shift the focus completely to the “acts” of the entities. The features of the entity being targeted are as important and relevant to any legislation intended to curb the perceived abuses in this context as it is in many other contexts.

          Will somebody’s babies be thrown out with the bathwater? Maybe. That’s how it works sometimes. People whine about it for a while and then some time goes by and nobody can remember what all the fuss was about. One day some proposed “theory” represents “the complete evisceration of the patent system” and five years later the same shrieker admits the ruling was “banal.” [shrugs]

          Reply
          1. If the concern is truly “asymmetric warfare” then your beef is with corporate structure law.

            “producing anything” is not a patent law requirement. Patents are purely a negative right – this is fundamental and basic stuff.

            That [shrug] posture tells more about you than you might think.

            Reply
            1. If the concern is truly “asymmetric warfare”

              Where are we? Are we on a patent blog or did we disappear into some weird wormhole where all we do is discuss whether we are “concerned” with abstract disembodied terms like “asymmetric warfare”?

              In fact, there’s some instances where I’m fully in support of “asymmetric warfare”.

              But I’m pretty sure this is a patent blog. And I’m sure that the advantages of asymmetric patent warfare under the current laws are benefitting people whose concerns in nearly every instance are very different from the concerns of, say, a minority group subject to massive government-sponsored discrimination simply because members of the minority group were born with red hair. And I’m also sure that the benefits to those people are vastly disproportionate to their product-free and primarily vaporous contributions to “technology”, and also disproportionate to the price that we all pay for their precious Total Freedom to Sue People for Using their Computer to Do Computer Stuff.

              I’ve said it before and I’ll say it again: the vast majority of profitable businesses have no use for patents. That’s why the vast majority of profitable businesses don’t own them, or give a rip about them one way or another. Who wants to live in a country like that except for patent lawyers and these snivelling “small inventors” of computer-implemented b a l oney? Nobody does.

              The people who never stop trying to expand patents into “everyday life”, so that everyone who ever engages in any kind of business (or who even offers information or advice to someone else) is forced to hire a patent attorney… they do this for purely selfish reasons or because they are simply bone ignorant and they are reciting a script. They might recite that script because they think they are better off reciting that script than not, or they might recite it because they just like irritating people “on the other side”. There are no exceptions to this basic rule that I’m aware of. If anyone knows of a person who fits the bill, please step up and identify him and her so we can confirm.

              Reply
              1. Where are we?

                LOL – the joke that is Malcolm keeps giving.

                Um, do you really think that just because this is a patent blog, that legal concepts – such as those I post about at post 10 – should – or even can – be segregated?

                You sir, are part of the problem in that regard.

                I also notice that you do not seem to have any difficulty QQing about other aspects of law as you see fit (typically in the “grifters” and pro-Jane modes.

                Go figure.

              2. I’ve said it before and I’ll say it again

                Mine’s better: get into a field and profession in which you can believe in the work product you (supposedly) produce.

          2. “The underlying concern is asymmetric warfare where the patent holder, by virtue of the fact that it is not in the business of producing anything substantial other than, possibly, more patents and patent lawsuits, has nothing to lose and everything to gain by asserting the jnk patent against anyone who might, for whatever reason, pay up.”

            Yes, poor Microsoft and Google are defenseless against the all mighty patent holder because the patent holder cleverly has no source of income, unless he wins his suit.

            Freedoms just another word for nothin’ left to loose..

            …and patent holders are free as a bird…

            FREEBIRRRRRRDDDD!

            Reply
      2. An important point to remember is that “commercialization” is not even a requirement of the Quid Pro Quo.

        Reply
        1. An important point to remember is that “commercialization” is not even a requirement of the Quid Pro Quo.

          An important point to remember is that we’re discussing changing the law to reflect policy concerns that, like 99.999% of our country’s laws, are not directly tied to this “quid pro quo.”

          Thanks for playing, Billy.

          Reply
          1. Brush away the ad hominem, and there is nothing left of your comment Malcolm.

            Are you saying that you want to change the foundational aspect of Quid Pro Quo?

            Reply
            1. Are you saying that you want to change the foundational aspect of Quid Pro Quo?

              What’s the frequency, Kenneth???? What’s the frequency, Kenneth????

              There are medications for you. Find them. Take them.

              Reply
    2. anon, I agree.

      The definition of a troll cannot be based solely on one’s status.

      E.g., women cannot be combat troops.

      Regarding the example, exclusion from combat should be based on those who fail XYZ test or tests, where the test is gender neutral and seeks to determine whether the individual has the mental and physical requirement to be in combat. For example, if a person cannot see, let us say, at least 20/40 without glasses or contacts, that person represents a danger to himself and to his comrades if placed in a combat situation.

      I would think a troll can be defined by conduct, and a court of law should first determine whether the particular individual/company/law firm is a troll based on a hearing and proof.

      Reply
    3. Probably create a whole new business of creating corporations per patent and then you sell the corporation with the patent. Probably could do that fairly cheaply. Delaware would love it.

      Reply
      1. Wyoming and some other states have a thing called a Series LLC just for this purpose. Well, their purpose is to help drilling and construction businesses operate each site independently without shared liability, but it uses the same structure.

        Reply
    4. “…bedrock consideration (and avowed purpose) of the patent system of full alienability of property”

      Srsly?

      LOL.

      Bed.

      Rock.

      Riiight.

      Reply
      1. Your moniker is chosen poorly.

        There is no argument in your post.

        Reply
  7. Why don’t we have special legislation that only applies to trolls. Such legislation should not run afoul of the requirements for equal protection and due process.

    Now, define “troll.”

    Reply
      1. Sure, Les:

        O’REILLY ET AL. v. MORSE ET AL., 56 U.S. 62, 14 L. Ed. 601, 1853 U.S. L.E.X.I.S. 273 (1853): “The provisions of the acts of Congress in relation to patents may be summed up in a few words.

        Whoever discovers that a certain useful result will be produced, in any art, machine, manufacture, or composition of matter, by the use of certain means, is entitled to a patent for it; provided he specifies the means he uses in a manner so full and exact, that any one skilled in the science to which it appertains, can, by using the means he specifies, without any addition to, or subtraction from them, produce precisely the result he describes. And if this cannot be done by the means he describes, the patent is void. And if it can be done, then the patent confers on him the exclusive right to use the means he specifies to produce the result or effect he describes, and nothing more. And it makes no difference, in this respect, whether the effect is produced by chemical agency or combination; or by the application of discoveries or principles in natural philosophy known or unknown before his invention; or by machinery acting altogether upon mechanical principles. In either case he must describe the manner and process as above mentioned, and the end it accomplishes. And any one may lawfully accomplish the same end without infringing the patent, if he uses means substantially different from those described.

        Indeed, if the eighth claim of the patentee can be maintained, there was no necessity for any specification, further than to say that he had discovered that, by using the motive power of electro-magnetism, he could print intelligible characters at any distance. We presume it will be admitted on all hands, that no patent could have issued on such a specification. Yet this claim can derive no aid from the specification filed. It is outside of it, and the patentee claims beyond it. And if it stands, it must stand simply on the ground that the broad terms above-mentioned were a sufficient description, and entitled him to a patent in terms equally broad. In our judgment the act of Congress cannot be so construed.”

        Hotel Security Checking Co. v. Lorraine Co., 160 F. 467 (2d Cir. 1908): “A system of transacting business, disconnected from the means for carrying out the system is not, within the most liberal interpretation of the term, an “art,” and, unless the means used are novel and disclose invention, such system is not patentable.”

        From these two cases, if a claim does not claim a patentable invention within matter that is eligible, it is abstract.

        Reply
        1. “From these two cases, if a claim does not claim a patentable invention within matter that is eligible, it is abstract.”

          Gee, all this time I though that if a claim does not claim a patentable invention within matter that is eligible, it is obvious.

          Thanks Ned! You gave me the definition I have been craving: “abstract” means “obvious”! This is a hoot.

          Reply
        2. It seems that you want to say that the matter must be one of the statutory categories, but you seem hesitant to actually make a clear stand.

          Odd as well, that you select tow pre-1952 cases… ;-)

          Straight up (and serious) question: do you understand the difference between patent eligible and patentable?

          Reply
        3. First of all, you were replying to Fish Sticks, not me.

          Second of all, Claims are part of the specification.

          Third of all, Claims recite a fingerprint that identifies copies of the invention, Claims do not themselves teach how to make an use the invention.

          So, had claim 8 ever been made or used before? Was the subject matter of claim 8 obvious?

          If not, the claim was valid, the court was wrong (as your comments on Bilski would indicate, courts can be and often are wrong). Pay the man. –… …–

          Reply
  8. Wow. This is the best the head of IP dev of a successful, well-known and respected company can come up with?

    Really?

    You don’t think the unconstitutional idea of trying to make a legal distinction between different types of patent-owning entities wasn’t already fought over in the Senate?

    … and it is intellectually dishonest for anyone to use and rely on the derogatory term “troll” … without concurrently providing their definition of “troll.”

    Nothing here a 2L couldn’t have come up with.

    Back to the drawing board, Mr. Shah.

    Reply
    1. Steve, I fully agree with your post. Defining a troll is the core issue.

      Reply
      1. Shouldn’t the focus be on defining actions which are abusive or in bad faith and finding ways to restrict those actions and not on defining “trolls” i.e. persecuting an entire category of entities grouped by association just because some entities within that conceptual grouping have engaged in abusive actions?

        Just my 2 cents.

        Reply
        1. Not only is your point a good one Anon2, but a more fundamental view is in order.

          If the problem is “visibility through corporate structure” – then ALL corporate formation laws need to be addressed.

          If the problem is “cost of litigation” -then ALL cost-related aspect of litigation need to be addressed.

          A critical problem with the very attempt to define the problem is the ASSumption that this is merely a patent problem.

          It is not.

          Corporate behavior that is criticized with patents exists for other assets as well. Court costs are “uncontrolled” in all forms of litigation and not just patent litigation.

          Of course, once the proper perspective is gained, items such as foreseen “unforeseen” consequences can be discussed as well. For example, if the costs of litigation are “controlled” (read that as made cheaper or “more reasonable”), then the sheer number of litigations will expand – and perhaps greatly so.

          To listen to those who think all of this is a “scourge” is to merely (and blindly) allow the flea on the tail of the dog to wag the dog.

          Reply
          1. If the problem is “visibility through corporate structure” – then ALL corporate formation laws need to be addressed. If the problem is “cost of litigation” -then ALL cost-related aspect of litigation need to be addressed.

            And “we” need to address them all in every context simultaneously because …. Billy says so.

            LOL.

            Reply
      2. Eh, defining trolls is difficult because it is not a monolithic group and it is an ad hoc insult.

        The problem isnt even one group of defendants. Sometimes it is indefinite claims plus strict liability causing the problem, sometimes it is overly broad claims that should not have been issued, and sometimes its just a popular, loud, guy who got caught with his hand in the cookie jar.

        Reply
        1. Ask yourself: who coined the term “Patent Troll?”
          Ask yourself: why did they coin the term?

          Hint: Big Corp – and not for the benefit of the public.

          Think about it.

          Reply
          1. I don’t even know why that is relevant. Also, its nonresponsive to my comment. Which is that there are several classes of “Patent trolls” and several classes of “Victims”, which is the nature of ad hoc reasoning.

            The “Trolls” are sometimes PAEs, sometimes solo inventors, sometimes big corporations, etc.

            Similarly the “Victims” are sometimes unsophisticated people who aren’t even aware they are using patented tech (end users, cough cough), sometimes are businesses legitimately being victimized by vague/bad patents, and sometimes just whiny loudmouths who want to do what they want to do.

            Its a meaningless term, just like “Judicial Activism”, “Patent Troll” is just a patentee that is suing me!

            Reply
            1. The relevance of the term’s [creation] is shown in its use then – and now.

              Open your eyes. Merely mouthing “I don’t know” won’t help you understand.

              Reply
          2. Exactly. I have in the past represented many individual inventors. How most of them could commercialise their invention without being labelled a troll is a problem. Unless you are said Big Corp, who would regard that as a feature. Certainly there are those who use useless patents to extract money, but if large corporate patent infringers can have everyone else labelled as trolls and, for example, made to comply with tougher pleading requirements, then of course they will do it, to the detriment of small inventors and the like.

            Reply
    2. You don’t think the unconstitutional idea of trying to make a legal distinction between different types of patent-owning entities wasn’t already fought over in the Senate?

      OK, so why is it an “unconstitutional” idea?

      Reply
    3. Steve, thanks for your comments. To be clear, I am in support of the Innovation Act applying across the board to all patent owners. However, there is resistance from the Pharma and Biotech industries which object to adding hurdles in asserting their patents. While I believe that the additional hurdles for asserting patents is beneficial for the patent system as a whole, I cannot fault anyone for wanting to retain the maximum rights for protecting their own innovations. My proposal is a compromise between biotech/pharma industry interests and high-tech industry interests.

      I do not provide an explicit definition of a troll because my proposal does not rely on such a definition. The proposal adds a cost to purchasing and asserting patents – the cost of preparing a case before using a purchased patent to sue others. This proposal would equally apply to any entity that acquires a patent – troll or operating company. I do not see any constitutional law issues.

      Reply
  9. VS This re-structuring of patent value is in-line with the true goals of the patent system, i.e., the promotion of innovation.

    Note that the Consitution suggests that the goal of the patent system is to promote “progress” in the “Useful Arts”, not for promoting mere “innovation”. The standard dictionary definition of “innovation” is “the act or process of introducing new ideas, devices, or methods.” There are an infinite number of “new” ideas that humans come up with on a daily basis that do not represent “progress in the Useful Arts” in the sense that most people would understand that phrase. Patents are not necessary to promote such “innovation”, nor does the public benefit when the system begins to grant entitlements for such “innovations.” In part, that’s because every patent system has limited time to spend evaluating and enforcing the entitlements that are granted. When patenting “everything under the sun” without meaningful limitations is encouraged, then we can rest assured that someone with the time and money to spare will attempt to patent “everything under the sun” and then demand to be rewarded for filing that paperwork.

    As for the specifics of VS’s proposal, I think the same heightened pleading requirements should apply to all patentees. As for this:

    other patent rights, damages, and requirements for patents would depend on whether or not the current patent owner is (a) the original Applicant /an assignee that the original Applicant is obligated to assign to at time of filing or (b) a third party that acquired the patent. In case of legitimate business spin-offs (that are not primarily a patent sale), the business spin-off or acquiring company would hold the same rights as the original Applicant

    … well, the devil is in the details, as they say.

    Ultimately, if we continue to allow patents to be granted on “new” methods of protecting information or information processing where the “inventor” has done nothing except (1) describe a new functionality for an old information-processing machine or system or (2) describe some new information that is useful in a particular field, then the patent system is going to continue its downhill slide into the muck. The reasons for that are obvious, as is the predictability of the shrill, mindless response from those who are already invested in that muck. The solution to this problem, too, is incredibly obvious.

    Reply
    1. >Note that the Consitution suggests that the goal of the patent system is to >promote “progress” in the “Useful Arts”, not for promoting >mere “innovation”.

      This is belly laughing stuff. “Mere innovation.” Here we go with the flash of genius and the model of inventions from Disney where a single person makes a giant step forward with no help from anyone and without building on anything.

      Reply
      1. >Along with many other ignorant people suffering from severe >Patentophilia you seem to have trouble distinguishing between a test >that requires an extreme level of insight and a test that eliminates a >low level of insight.

        Or I can spot a flash of genius argument a mile away.

        >“fundamentalists raping and killing people in Iraq.”
        You are like them in that you are intolerant and don’t care about the law.

        Reply
        1. You are like them in that you are intolerant

          Oh, I see. You compared critics of the patent system to “rapists and killers” because you’re a super tolerant hippie and you wanted to show everybody the power of pure love.

          [you] don’t care about the law.

          I wouldn’t be commenting here if I didn’t care about the law. Seriously, man: why not just apologize and we can all move on until you stick your foot in your mouth again in two months?

          Reply
            1. Looks like my shadow is back again under a new (and not so terribly creative) name.

              Hey, where are my funny gifs?

              How is your search for a modern advance country that has chucked all of their IP laws?

              Reply
          1. I wouldn’t be commenting here if I didn’t care about the law

            A fine example of false logic.

            You have shown that you don’t care at all for the Rule of Law.

            What you DO care about is your own little curse-ade. Your commenting does not serve the law. It serves your brand of “policy”/opinion, and that is all it serves.

            Reply
            1. You have shown that you don’t care at all for the Rule of Law.

              Oh boy, here come’s Billy again with his lawlier-than-thou shtick. Give it a rest, you toxic pr ick.

              Reply
            2. Your commenting … serves your brand of “policy”/opinion

              Aren’t we lucky that Billy is so objective?

              Golly, we’re so lucky.

              Reply
            3. toxic…?

              Um, have you seen the festering pus that is your mind from your dealing with work product that you so clearly despise?

              As AOOTWMD’s go, well, even for the king of them, this one is a doozy.

              Reply
    2. MM, the basic patent statute, 101, a statute that has been in force with essentially the same language since 1793, provides that patentable inventions are new or improved, and useful, processes, machines, manufactures and/or compositions. Information, ideas, printed matter, music, business methods including methods that determine a new or improved price, risk, profit and the like, are clearly not statutory in the sense they are neither any one of the four classes. We don’t have to get into what “useful arts” is at its outer limits. Congress has set the limits in the basic patent statute.

      As we learned in Prometheus, combining ineligible subject matter with old, conventional, but eligible subject matter does not produce an eligible invention.

      Any claim who eligibility depends upon the inclusion in the claim of a generic computer or the equivalent is now suspect post Alice.

      Since most trolls assert information-processing type patents, I think Alice goes a long way to solving the troll problem. We should let sleeping dogs lie while the courts deal with this new Supreme Court case.

      Reply
      1. Your recreation of history and new spin remains seriously flawed.

        Reply
      2. Is grain (fully natural grain) statutory?

        How about electrons?
        How about protons?
        How about neutrons?

        Only God starts from scratch.

        Reply
    3. not necessary…

      The derivative of the vap1d “but for ONLY” position.

      Reply
  10. Leaving aside distinctions made between individual people and corporations/business entities as different types of owners, are there examples of other kinds of properties or bundles of rights (other than patents), to which ownership/control may apply, but for which that ownership/control is unequally limited (by government) arbitrarily based on the particular type of owner?

    I’m looking for an example where, property in the hands of one owner planning to do one thing, is treated by government in a completely different manner from another owner with the exact same property planning to do the exact same thing.

    Is such discrimination permissible/constitutional?

    Reply
    1. are there examples of other kinds of properties or bundles of rights … for which that ownership/control is unequally limited (by government) arbitrarily based on the particular type of owner?

      Arbitrarily? Well, the the government’s deference towards certain “sincere” (LOL) religious beliefs and not others definitely borders on the arbitrary, in my opinion. But let me go waaaaay out on a limb and take a wild guess: that’s not a big concern of yours.

      property in the hands of one owner planning to do one thing is treated by government in a completely different manner from another owner with the exact same property planning to do the exact same thing

      Completely different? Or just different in some matter of degree? For example, I wouldn’t characterize a heighted pleading requirement for a patent lawsuit as “completely different” treatment of the patent right. You might as well argue that a 2 1/2 foot tall kid or a 600 pound man is being treated “completely differently” from everyone else at the amusement park because 4 of the 200 rides don’t accomodate him/her.

      Also, note that it isn’t “the property” per se that is being “discriminated against” but rather a particular adversarial use of that property by a particular class of property owner that is being “discriminated against.” Is this such discrimination really that unusual and/or “constitutionally” alarming?

      For example, let’s say you live in Texas and you own a car and you enjoy doing driving it around the block. Your neighbor also owns a car and he enjoys driving it around the block. Can you think of any differences between you and your neighbor that might allow the state to “discriminate” against your neighbor, even though you both own the “exact same property” and want to do “the exact same thing” with it? Texas was able to think of some. Welcome to America.

      Reply
      1. Two things:

        1. You are waaaaay off if you think “deference” to any religion by government is not a big concern to me. It absolutely is. The separation of Church and state is of paramount importance.

        2. I can’t figure out whether you being sarcastic, ironic, or indifferent in your last paragraph… I will just suppose you think racial profiling is OK. As long as the local government says it’s OK that is…

        Reply
          1. Anon2: The separation of Church and state is of paramount importance.

            Then surely you are aware that “sincere” religious people can do things with, e.g., peyote, that other people can’t legally do. That’s an easy response to your ge neralized grievance (and not the only easy response). What could possibly more “arbitrary” than a rule predicated on the “sincerity” of one’s belief in invisible, undetectable beings?

            I can’t figure out whether you being sarcastic, ironic, or indifferent in your last paragraph…

            I’m giving you a simple answer to your simple question. Texas discriminates between different car owners who own “the exact same” cars and “who plan to do the exact same thing” with them.

            I will just suppose you think racial profiling is OK.

            Uh … no.

            Try “discrimination” based on age or prior driving violations. And note that this “discrimination” may seem perfectly “arbitrary” depending on where you stand with respect to the policy concerns that drove the “discriminatory” legislation.

            Reply
            1. may seem perfectly “arbitrary” depending on where you stand with respect to the policy concerns that drove the “discriminatory” legislation.

              LOL – literally, a “WHATEVER” position there Malcolm.

              Reply
            2. Then surely you are aware that “sincere” religious people can do things with, e.g., peyote, that other people can’t legally do

              Um, I think that you need to read Employment Division v Smith again.

              Here’s a primer: link to en.wikipedia.org

              Reply
        1. Anon2- My response is stuck in the moderation queue for reasons that are opaque (to me). Just be patient …

          Reply
            1. It appears that “gen” is OK, but when you add that prefix to “er” is when the moderation filter aggressively acts.

              Reply
      2. By the way I never claimed the property per se was being discriminated against… my point was that the property and its intended use was exactly the same and only the owner/entity was “different”

        Reply
    2. My guess would be that this happens all the time in the eminent domain context. Local or state government might consider certain kinds of property uses to be more valuable for the community if left intact rather than bulldozing it, and that necessarily ties into what kind of entity controls the property.

      Reply
        1. “public good”… the standard de jour…

          When has the public good not been a consideration of our country’s lawmakers?

          Reply
          1. When it is bastardized – as in the Peoples Republic of China is to “We the People.”

            Don’t worry Malcolm, Jane is still proud of your efforts.

            Reply
            1. Yes. The invocation of the mystical power of the “public good” is often bastardized.

              Conceptually the “public” is a plurality of individual people and “good” is what is good for each individual but some kinds of mentalities evidently believe mashing “public” next to “good” (in a pseudo-concept) allows them to ignore individual people, what good means, as well as rights, justice, and sanity.

              Reply
  11. It would seem counterproductive to create separate classes of patent based on the identity of the owner. Not good for liquidity or the potentially useful market action that responsible PAE’s might accomplish.

    The solution has to be in the jurisprudence. It’s the fees that are the problem; the basic unfairness of an accusation being equal to guilt, because merely to be accused is to pay out the ass without recourse.

    What is needed is some kind of up-front hearing where a judge looks at the basic facts and makes a preliminary decision about the fee balance of the case . If the litigants are roughly equal or at least on the same planet, if there is an actual dispute over actual markets and products, if there are no compelling invalidity or non-infringement contentions, then the case should proceed normally.

    If it’s IBM asserting a 17 year old nothingburger of an acquired patent against a nobody of a company, and they still want to push it, they should be on notice that if they lose, they will pay fees. The general rules/procedures of 101, 102, and 103 can be used, but the full panoply of discovery, experts, etc. should not be required to establish a fee basis of a case.

    District judges can make these kinds of calls, and that’s how you kill patent trolling as a profitable racket. The judiciary and the patent bar created the problem, and they should fix it before a blunt tool like Congress is required.

    Reply
    1. The solution has to be in the jurisprudence

      Absolutely wrong Marty. Since you are not a lawyer, I suggest you ask your attorney about this little thing called separation of powers. That “blunt tool” you are thinking of is the ONLY sanctioned branch of the government that has the authority to write patent law.

      As for the “nothingburger” – hey, you can always stop and respect the patent, pay what the patent holder is asking, or do something else.

      Reply
  12. This is pretty funny stuff from Dennis, although likely unintentional: “the pro-patent lobby remains strong enough to ensure that congressional reforms will not completely eviscerate the system”

    Um … right. And the US military remains strong enough that Michigan militia groups will not completely take over and “completely eviscerate” the United States government. Thanks for the reminder, Dennis! We can all sleep easier tonight.

    Seriously, people, it’s not only the “pro-patent lobby” that would oppose “complete evisceration” of the system but also nearly every single one of the people who are dismayed by the rise of patent trolling.

    The US patent system has never been “completely eviscerated” by anybody in its long history — nothing remotely like that has ever happened, in spite of the paranoid fantasies you’ll read from the same folks who comment here and accuse every critic of our contemporary patent system of being equivalent to amoral “rapists and killers”. Nor has any serious consideration ever been given to “completely eviscerating” the patent system by anybody with the power do to so (everybody would be happy to be corrected on that point, Dennis).

    The fact remains that, in spite of the perpetual howling of the deeply invested chicken littles (almost invariably patent lawyers or so-called “small inventors” who benefit most directly and immediately from an unchecked patent system), hundreds of thousands of patents will be granted this year, just as they were last year, and the year before that, and the year before that.

    What’s the latest word on patent litigation filing rates? There was much discussion in the Spring about a “precipitous drop” in January and how that was supposed to mean that nobody was allowed to talk about patent trolling anymore. But something happened after that, didn’t it?

    Bottom line here: worrying about “complete evisceration” of the patent system is like worrying about Obama coming to your house and forcing you to catalog all your personal belongings for the government’s database. If you’re worrying about that, chances are good that what you really need to be worrying about is the medications that your physician did or did not prescribe to you.

    Reply
    1. MM smoke machine on full power. I don’t want to eviscerate the patent system. I only want to eviscerate the patent system for patent applications and patents that I don’t like.

      Reply
      1. I only want to eviscerate the patent system for patent applications and patents that I don’t like.

        Please describe for everyone the sorts of patents that you don’t like.

        Reply
        1. So typical – the comment was to you Malcolm and your NIMBY ways and you spun it around and asked for an answer from NWPA, who clearly does not operate under the same particular-art-unit aimed diatribes that you do.

          Reply
          1. Please describe for everyone the sorts of patents you don’t like, Billy.

            Unless, of course, you like them all.

            Go ahead. Surprise everybody.

            Reply
            1. LOL – Don’t you remember Malcolm?

              The great slogan is More Patents All The Time.

              Of course, you attempt to spin this and mischaracterize the fact that more valid patents all the time is the aim.

              And this comes from your attempt to NOT hold to the Quid Pro Quo and the realization that more valid patents granted necessarily means that the patent office is WORKING and meeting its goal of promoting the progress.

              You really need to get into a line of work in which you can believe in the work product you (supposedly) produce.

              Reply
  13. Was heightened pleading standards really the key issue that killed this proposed legislation in the Senate after the Goodlatte Bill had passed in the House? Wasn’t enhanced “loser pays” a bigger issue? Could not a significantly less burdensome pleading standard have been drafted? After all, doesn’t it still look like the old and often inadequate FRCP Form 18 is headed for FRCP rulemaking elimination soon anyway?

    Reply
    1. Some problems with heightened pleading are:
      1. You don’t have discovery yet, so how can you plead with specificity?
      2. It’s expensive, and if you’re the little guy, that’s a problem.
      3. It’s pointless.

      Reply
    2. Agreed. When a proposal starts out with a spin like that … you just know the whopper is coming next.

      Reply
  14. This obviously lowers the value of all patents. I bet this would cause all sorts of strange goings on. Companies forming subsidiaries and putting subsets of their patents in the subsidiary so they can sell the entire subset without the patents losing value. Etc.

    Typical type of solution that hasn’t been well-thought out and will only add to the complexity.

    Reply
    1. That’s what I see happening too, contracts and business entities created to evade the restrictions listed in the original proposal. People are very creative about finding ways to get around such limitations. And creating separate classes of patent ownership may indeed be unconstitutional.

      Reply
      1. creating separate classes of patent ownership may indeed be unconstitutional.

        What about separate class of patent applicants? Is that unconstitutional?

        Reply
        1. Full alienability of property makes your attempted designations of patent applicants rather bogus spin.

          Of course, you know – or should know – this already.

          Reply
      2. And creating separate classes of patent ownership may indeed be unconstitutional.

        People keep throwing out this suggestion, but nobody seems to want to back it up. Please, Robert, explain why “creating separate classes of patent ownership may indeed be unconstitutional.”

        Reply
        1. DanH, I am sure you have heard of “equal protection” and all its jurisprudence. 14th Amendment. Applies to states, right?

          Well, it applies to the US laws as well. Bolling v. Sharpe, 347 U.S. 497, 74 S. Ct. 693, 98 L. Ed. 884 (1954).

          Reply
          1. Yes, Ned, I’m aware of “equal protection,” and I’m aware that there is an implicit equal protection clause in the 5th Amendment, which applies to the federal government. But so far we’re at a 9th-grade level. Now, I’m sure you’ve heard of the different levels of scrutiny, and understand when they are triggered, right? What level of scrutiny would apply to a law that distinguished between owners based on their source of ownership? And how hard is it for the government to get past that level of scrutiny?

            Reply
            1. DanH, I agree that some fundamental liberty interest has to be implicated or the law has to be completely irrational.

              Ownership status? Is that a protected liberty interest?

              Reply
            2. apply to a law that distinguished between owners based on their source of ownership?

              One that goes against a fundamental reason for the patent system in the first place? Even the lowest level does not survive that level of scrutiny.

              Reply
              1. Oh, but you do have to open your eyes and apply scrutiny, which does mean that an understanding of full alienability of property rights must be given its due weight.

                6, did you fave the thread that references your former man-crush Dudas and his sharing of the award-winning historical research into some of the key foundational aspects of US patent law?

  15. Huge hole: I typically assign my inventors’ inventions to entities that they later create to run the business under. Under that definition, all of these guys trying to start legit businesses are trolls.

    Ah well, back to the drawing board.

    Reply
    1. Some of us would love to hear your reasons why you “absolutely disagree with Mr. Shah’s proposal”.

      Some things need to be heard and more so from respected individuals like yourself.

      Reply
      1. Probably because the system encourages ridiculous arbitrage and rent seeking schemes.

        Oh, and it doesn’t fix any of the issues it purports to.

        Reply
    2. I should note that I absolutely disagree with Mr. Shah’s proposal

      Maybe later in the day you can tell everyone why you disagree, or whether there are improvements that could be made to the proposal to make it less disagreeable.

      Reply
      1. Improvements?

        LOL – start with a respect for the Rule of Law and the foundational aspect of full alienability of property.

        Reply

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