Patent as Credentials

By Jason Rantanen

I’ve been taking a break from blogging for the past few months to focus on teaching, research and service at the University of Iowa.  That’s allowed me to experience new aspects of technological innovation and patent law, particularly in the context of a research university.  It’s also allowed me to work on a couple of projects that are finally coming to fruition.

The first is described below.  It’s a concept that will likely feel familiar to most patent practitioners. I’ve just articulated the inchoate idea and given it structure to allow it to be weighed and debated more easily. Virtually every person connected with patent law that I’ve shown the paper to has had examples and stories of their own, some of which I’ve added. At the onset I want to make clear that while I think that the credentialing function of patents has merit on balance, in individual situations it can have substantial negative effects.

Here’s the abstract:

The conventional explanation for why people seek patents draws on a simple economic rationale. Patents, the usual story goes, provide a financial reward: the ability to engage in supracompetitive pricing by excluding others from practicing the claimed technology. People are drawn to file for patents because that is how these economic rewards are secured. While scholars have proposed variations on the basic exclusionary mechanism, and a few have explored alternate reasons why businesses seek patents, the question of whether individuals—human beings—seek patents for reasons other than the conventional economic incentive remains unexplored. As Jessica Silbey recently observed, human creativity is motivated by more than just the potential for immediate economic returns. But an individual’s motivation to create does not explain why that person would go through the trouble and expense of obtaining a patent absent the promise of economic gain.

We offer an explanation for why individuals may seek patents beyond the promise of supracompetitive pricing: patents serve as credentials. Simply put, some human beings want to be recognized by society as inventors. But claiming to be an inventor without evidence is unlikely to persuade the masses—or perhaps even friends. Patents serve as powerful evidence that an individual meets the societal definition of “inventor.” Just as a doctoral degree in history might indicate that one is an intellectual, obtaining a patent shows that the person named on its face is a real-life, government-certified inventor. Regardless of whether a particular patent conveys an economically valuable mechanism of exclusion, the inventorship recognition alone may motivate some individuals to seek patents.

Links to the draft article are here:

SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3013780

SocArXiv:  https://osf.io/edumf/

 

55 thoughts on “Patent as Credentials

  1. This is just an offensive blog post. This is part of the Lemley theme about diminishing patents by playing up on a tiny portion of the reason a few people file patents. In view of what is happening right now to the patent system, this blog post should be deleted. (Somehow I am sure my post will be.)

    And, now for some real news:

    link to wsj.com

    1. I disagree with you re people pursuing patents as a status symbol somehow “diminishing” patents.

      Indeed, tis the opposite. It is an important gubmit function to stamp things. And about that I’m not even lying. That’s one of the gubmit’s main products, items stamped. Indeed, it might be one of the most important functions gubmit plays in the modern world.

      1. 6, the point is that the value of patents to the US is the innovation engine they have created.

        This blog post is similar to Lemley’s assertion that patent filings aren’t dropping despite the beating they are taking in court and with IPRs. I.e., that there are other reasons people file patents. This is absurd. First, patent filings are dropping big time for small inventors and are dropping for corporation when the numbers are normalized.

        So, the only reason patents have some cache is because of their value in the innovation engine. This credential business is a side-show. It would be like talking of getting rid of all universities (let’s start with Stanford law school) because some people just like to show their diploma. The question is not whether or not their are show-offs but the underlying value of the education and patent system.

        I know. I need 5 minutes to clean that up and don’t have it. I hope you get that this is a side-show to try to diminish the value of patents.

  2. Martin, Claims disclose?

    What does the specification disclose?

    Moreover, if the claims are overbroad, i.e., only claim a result, and they are a combination claim, then 112(f) should apply.

  3. Jai, excellent points. It does illustrate confusion caused by applying Morse, which involves overbreadth, to the question of whether the subject matter is within the four classes.

    I would remark that if a combination claim is involved, that Congress has statutorily overruled Morse/Halliburton in section 112(f). There can be no overbreadth provided there is corresponding structure, materials and acts described in the specification that are not themselves purely functional.

    (Posted here because my post are being blocked in the 101 thread.)

  4. What does it mean to “automatically use” an equation “at a point” in a process. When is the equation “being used” to do something new?

    Malcolm, I believe the claim describe a programmed computer that operated on the temperatures measured during operation. The improvement was that the mold was opened and a more accurate time leading to a demonstrably better process.

  5. Random, my replies to you in the 101 thread are being blocked by the filer. You might ask Dennis to see my posts.

  6. Law professors should be thankful there’s no obviousness requirement for law review articles.

    1. “…should be thankful there’s no obviousness requirement for law review articles”

      There’s not? Are you certain?

      I mean, they do for the most part seem painfully obvious.

      😉

  7. Two of my earliest clients had their live’s changed by their patents.

    One had no college degree and worked as a repairman of sorts for a particular company. He at least told me that after getting the patent, employers were willing to consider him for positions that previously they would not consider him for, and as a result was happy customer despite not really being able to market his invention effectively.
    Another, after getting her patent, made a deal with a large company, and then spent at least the next year, or so, touring the country demonstrating her product and selling it on behalf of the company. I don’t know if she made any significant amount of money from the patent itself, but she told me that she was having a blast being paid to demonstrate her.

    Nonetheless, I have always assumed that those two cases are more of the exception. I tell those that want to me apply for a patent on their behalf for the sole purpose of boosting their credentials, that filing a patent is probably not a good way to do that, considering the expense – its just not the same as having a higher degree and I cannot imagine most employers looking at it as such. However, it would certainly be nice to see actual data quantifying how much a patent increases someone’s take-home pay, when used as credentials, so that I could better advise clients on that issue.

  8. It depends to some extent on the environment of the inventor. Clearly in some corporations and universities the number of patents granted to an inventor can have financial benefits for inventor in salaries and even cash awards in some cases. Many inventors also consider patents valuable additions to their resumes, especially if they want to, or fear, having to make a move to a different employer. Or, use for support for seeking grants or joint R&D support.
    The corporation or university itself may benefit [and thus encourage] filing patent applications for PR value for the institution and/or for making the corporation look more like a high tech company, which can enhance its stock price, which in turn personally benefits stock options of executives.
    [Also, more than a few scientists and private inventors have no UMC or marketing analysis education or experience and push for patenting many economically impractical ideas of theirs, if that waste of funds is not adequately monitored or vetted. Interesting research results or ideas may or may not, of course, have any real commercial value and the inventor may often not be the most qualified or objective to evauluate that.]

    1. Indeed, consider the recent case involving Seagate where a scientist was fired for complaining that he had been left off of a patent where he was at least a coinventor. The Federal Circuit held that being a named inventor had reputational impact and therefore being left off negatively impacted the employee’s reputation.

      But this is why inventors in institutions such as big business and universities seek patents. But the common man, not employed by one of these, simply cannot afford luxury of spending tens of thousands to enhance their reputation. They need more.

      1. the common man … simply cannot afford luxury of spending tens of thousands to enhance their reputation. They need more.

        And then the rocket went past Jupiter, into outer space. And beyond!

  9. Correct, a U.S. patent is has become a mere certificate of achievement. Not a right. Very important that the patent bar start telling the truth to their clients

  10. Bye bye, tr 0lls. And congrats to the EFF.

    Personal Audio Tr 0lls v. EFF

    Judge Newman:

    [T]he party invoking judicial review is Personal Audio; it is apparent that Personal Audio, on cancellation of its patent claims by the PTAB, has
    experienced an alteration of “tangible legal rights . . . that is sufficiently ‘distinct and palpable’ to confer standing under Article III.” …With Article III satisfied as to the appellant, EFF is not constitutionally excluded from appearing in court to defend the PTAB decision in its favor

    Tanking of claims under 102/103 upheld. Oh, and this is the extent of Judge Newman’s “analysis” of Personal Audio’s arguments against anticipation:

    We have considered all of Personal Audio’s arguments, and affirm the PTAB’s conclusion that the challenged claims are anticipated by the Patrick/CBC reference

    LOL But thank goodness it wasn’t a Rule 36 affirmance.

      1. Maybe Malcolm will condense that to one (very long) acronym as a single word reply (to fit his strawman of a certain number of words by the court….)

        😉

      2. There’s also five pages of claim construction discussion.

        Some of which farcically delves into the issue of “what is episodic content”, as if the answer to that question could ever have bearing on patent validity.

        1. Even IF “some of which” is as you characterize, that means that some of which is not.

          Do you recognize what that means for your comment at 5 (and your general strawman of “word count”)…?

    1. MM, Newman likes to decide constitutional questions in a way that provokes constitutional crises. Here is an article written about defendant standing that concludes exactly the opposite. Hall, Matthew I. “Standing of Intervenor-Defendants in Public Law Litigation.” Fordham L. Rev. 80 (2011): 1539. link to ir.lawnet.fordham.edu

    2. The ASARCO Inc. v. Kadish, 490 U.S. 605, 618 (1989) case that Newman relies on actually finds that the defendant had particularized harm. Id. At 618.

      1. Ned,

        You seem to be confusing parties’ positions and the standing question in ASARCO. At page 618, the Supreme Court is discussing the standing of the “defendants” (who were the petitioners at SCOTUS, i.e. the ones invoking the jurisdiction of the court) – who are directly analogous to Personal Audio (who was the “defendant” at the PTAB and appellant/petitioner at the Fed Cir, i.e. the one invoking the jurisdiction of the court).

        1. Jane, just to be clear, Newman’s point was that standing only applies to the party seeking to invoke federal power. That is not true. All parties have to have standing.

          In the Fordham article I linked the question was the constitutionality of a California proposition. There is no question about the standing of the people petitioning the courts to declare the proposition unconstitutional. It is just that the government of California refused to defend the proposition. The intervener/defendants had to prove standing. How are they harmed if the proposition was declared to be unconstitutional? They had to show particular lies standing, and could not simply rely on the standing of the party plaintiff.

          In the end, and that case Perry v. Schwarzenegger, the Ninth Circuit referred the question to California, Perry v. Brown, that held that the interveners did have standing because they were the backers of the proposition in the first place. Thus they had particularized harm.

          Now consider a party that does not have standing brings a case challenging the validity of a patent. The patent was declared invalid. The patent owner appeals. The original plaintiff cannot defend its standing in the appellate court on the basis that the petitioner, the patent owner has standing.

          Because the petitioner this case could not have brought a federal case in the first place, it does not have standing in this appeal. It is a simple as that.

          1. Ned,

            Let’s assume you’re right. How do you explain the practice of SCOTUS (and on occasion, the Fed Cir) appointing an amicus to argue a position if every party must have “standing”?

            Continuing to assume you’re correct, what is the result you think would be proper? A patent owner gets to appeal without opposition (which raises its own issues of courts generally requiring adverse presentation of issues)? Why couldn’t the Fed Cir appoint an amicus, and if it can, wouldn’t the party who challenged at the PTAB be the best amicus? Is your argument just that the EFF shouldn’t be in the caption?

            I believe you’re continuing to confuse the parties’ positions, and failing to recognize the analysis may differ at different points in the case. In the case you mention, the defendant/intervenors needed to show standing on appeal where they were the one who was invoking the appellate court’s jurisdiction. See 133 S.Ct. 2652, 2661 (“We therefore must decide whether petitioners had standing to appeal the District Court’s order.“) (emphasis added)

            The question was not whether the district court could lawfully hear the case. You’ll note that the Supreme Court did not say the petitioners’/defendant-intervenors’ participation at the District Court was improper. Only on appeal did the petitioners’ standing become an issue, when they were the party seeking to invoke the jurisdiction of the court.

            1. Jane, there is no doubt that if an accused infringer had brought the petition in the first place, they could show that they have standing in the Federal Circuit just as they would have standing to bring a declaratory judgment action that the patent was invalid.

              But because EFF never had standing to bring a declaratory judgment action in the first place, it cannot rely on the standing of the patent owner and simply suggest that that confers on it standing. That makes no sense.

              Regarding amici – if the amici demonstrates in their amicus brief that they have particularized harm, they certainly have standing to argue their position.

              This is not a complicated issue. Newman is so far afield and beyond the pale that she has once again created a constitutional crisis in patent law.

              1. EFF never had standing to bring a declaratory judgment action in the first place,

                That has nothing to do with this case which didn’t involve a declaratory judgment.

                The fact of the matter is that all of our rights were affected by the PTO’s negligent grant in the first place. That’s why we all have the right to petition the PTO to fix its error.

          2. Ned,

            Is this related to the prior discussion we had for which the requirement of stranding for both parties is something often overlooked?

            (I don’t remember the thread, off the top of my head…)

            1. Absolutely. For example, if a party settles out, the case becomes moot. The party selling out simply cannot stay in the case and continue arguing, and cannot rely on the standing of the other party as a substitute for its own standing.

          3. Ned: All parties have to have standing.

            False.

            if a party [with standing] settles out, the case becomes moot.

            That’s not the issue here. It’s true that if Personal Audio had “settled out” (and left the PTAB’s invalidity holding stand) then EFF (the petitioner) wouldn’t have had standing to appeal. But why would EFF have appealed in that circumstance? The answer is that EFF would never want to appeal in that circumstance.

            Because the petitioner this case could not have brought a federal case in the first place, it does not have standing in this appeal. It is a simple as that.

            That is absurd. What about applicants who are denied a patent by the PTO? They couldn’t have “brought a federal case in the first place” to obtain the patent grant. They first had to go to the PTO. Why? Because that’s how Congress set it up. Why did they set it up that way? Because they wanted to and nothing — NOTHING — in the Constitution says otherwise.

            Now let’s hear your cute little story about King Charles the MCMVIII and the Writ of Sherwood Forest. Very compelling!

              1. Congress cannot confer standing by statute.

                There is no “conferring standing by statute”.

                Now go ahead and argue that Congress can’t define a “patent right”, by statute, to be a conditional right revokable by the granting agency upon a showing. Go ahead and tell everyone that Congress can’t do that because Sherwood Forest in the 16th century.

                Go ahead. It’s always good for a laugh.

            1. Malcolm,

              Seeing as past discussions have included third party (independent of any of the usual crowd here) confirmation of the thing that you seek to dismiss with a single word, I would be interested if you can point to any support whatsoever for your assertion.

              Hopefully, the fact that this point is not driven by Ned or myself might generate a substantive reply from you.

    3. Good for the EFF. They stood in defense of the little guy that likely would not have had the resources or know-how individually to fight against this.

  11. the inventorship recognition alone may motivate some individuals to seek patents.

    Reminds me: what’s up with Gil Hyatt’s applications? He was the guy who “invented” the “microprocessor”, until he didn’t.

  12. The thought that comes to mind is the provision of patent law in Europe that allows inventors named as such in European patent applications to keep their identity secret from the public. Amongst the ones that take up that chance are those who would otherwise run the risk of losing their lives at the hands of animal rights and other assorted “activists”.

    I thought at first that Jason was researching those very few inventors who buy patent rights out of their own pocket. But nearly all the ones who are assiduously amassing “credentials” as inventors are people who need those credentials to advance their career, irrespective whether it is at any given moment at university or in a corporate environment. Was it ever exclusively “economic gain” that drives people along their chosen career path in pursuance of their chosen vocation? I think not.

    When was it ever the case that those named as inventors were not interested in acquiring the credentials of which Jason writes?

    Perhaps now I should have a butchers at the Draft Paper.

  13. Jason, with due respect, this “idea” qualifies as academic research? Did you invent sex too?

    A lot of independent inventors seek patents also because they overestimate the percentage of the distance toward commercial success represented by the patent milestone. Many see an issued patent as getting more than halfway to profitable commercialization, as opposed to the reality–closer to 0.5%.

  14. “obtaining a patent shows that the person named on its face is a real-life, government-certified inventor. ”

    Well, it used to. Now it merely shows that you were the first person to FILE for a patent, even if someone else actually invented the thing.

    1. If you’re the first to write a “paper” about something obvious, do you get some sort of credential credit for it? There’s something meta about this.

    2. Les,

      You continue to hew to the Madstad theory…

      (which of course does not stand up to the PRE-AIA patent law either….)

      1. Now it merely shows that you were the first person to FILE for a patent, even if someone else actually invented the thing.

                1. Les do you know what invent means?

                  Invent: from the verb invenire, from in- ‘into’ + venire ‘come.’

                  In England, patents were first used to bring new trade and new arts into England by granting to people who would come to England and bring such new know how patents for a limited time, typically 13-21 years.

                  Later, was applied to new manufacturers first created by Englishmen. They too were called inventors although they did not bring into England anything known from outside of England.

                2. Les – besides already answering your question (just because you do not like my answer does it NOT an answer make), I have asked you first – and you have never answered this question.

                  Your unwillingness is telling.

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