Patent or Blackmail?

Here is a list of some of the great human achievements of the past five hundred years: the Scientific Revolution, the Industrial Revolution, the patent system . . . . What's that last one doing there? Historians of technology rightly regard the development of patent law as one of the most significant intellectual innovations of the early modern period. Beginning in Renaissance Europe and spreading to America, the idea that an inventor's rights to make and sell his invention should be protected by law for a limited period encouraged innovation while ensuring that the rights of the general public would also be protected from monopolies of indefinite lifetime. Engineers, whose ideas form the basis of many patents, should be interested to know that the present U. S. patent system is being gamed in a major way, to the detriment of nearly all concerned.

The most recent example of this concerns the firm Research in Motion, which makes the popular Blackberry wireless communication system. It used to be the case that patents were fairly difficult to obtain. The inventor's patent attorneys were pretty evenly matched by the U. S. government's patent examiners, whose job it was to make sure that trivial, obvious, or otherwise meritless patents were not issued. Patenting an idea was a serious and sometimes difficult undertaking, but when you got one, you knew you had something, and so did everyone else.

Not so anymore. A combination of factors—inadequate Patent Office funding, a hyper-pro-business attitude in government, and speedups in the pace of innovation—have made it much easier to get a patent in the last ten to twenty years. This includes dubious ones sometimes called "submarine patents"—not patents on the submarine, but patents deliberately designed to cover all parts of an emerging field, whether or not the supposed inventor has any genuinely innovative ideas or not. In the past, these types of patents would have never been issued, but in the current almost-anything-goes atmosphere, all it takes is enough money paid to a good patent firm.

What happened to Research in Motion this year shows what kind of harm can result from this over-liberalized issuing of patents. In the early 1990's, one Thomas Campagna patented some ideas for wireless email. In the meantime, Research in Motion put in a lot of work to develop the Blackberry, and obtained its own patents. In 2001, a company named NTP, formed to exploit Campagna's patents, sued RIM for patent infringement. The resulting legal hassle threatened to produce an injunction that would shut down all Blackberry services in the U. S., clearly an outcome that would benefit no one. This was despite the fact that the U. S. Patent and Trademark Office re-examined and rejected at least seven of NTP's patents along the way. In March of this year, RIM announced a settlement in which NTP would receive over $600 million. No doubt RIM views this as part of the cost of staying in business. But if the shady NTP patents had never been issued in the first place, none of this would have happened.

What has this got to do with engineering ethics? A lot. First, engineers can refrain from participating in the generation of "junk" patents. Unfortunately, this may not have much of an effect, since unscrupulous patent lawyers don't need much in the way of technical help to cobble together useless patents. This is not to say that patenting is unethical in general. Properly used in a well-conducted system, patents help to achieve the balance between monopolistic profit, innovation, and reasonably-priced new products and services that characterizes modern industrial societies. But the pendulum has swung way too far in favor of patent owners and patent attorneys to the detriment of the general public and those who actually do the hard work of developing and marketing new products, only to have their resources diverted into pointless patent battles. Under the present circumstances, the danger is that innovation will be stifled by artificially extended patents that allow established firms to exclude competition indefinitely. This is already happening in the pharmaceutical industry as some firms come up with patented repackaging of old patented drugs to prevent a cheaper generic form from coming onto the market. Who pays for this? The beleaguered patient who has to pay beaucoup bucks for the name-brand drug longer than necessary.

The second thing engineers can do is to make a political issue out of the patent system. True, it doesn't have the popular appeal of antiwar movements or tax reform. But it is critically important to fix a badly broken system before R&D departments of multinational firms decide to relocate in countries where the system is more rational. Ever since the U. S. patent system was founded in 1790, it has differed in significant ways from most European systems. One of the most important differences is that most European patent holders must show that they are licensing their patent to others or using their patents themselves, while there is no such requirement in the U. S. This allows U. S. patent holders to "sit on" submarine patents that lie dormant until a well-heeled company comes within the sights of the patent-holder's legal gun. Besides changes in the legal structure of patents, the U. S. Patent and Trademark Office simply needs a lot more good help in the form of funding and staff to stay competitive with the best private patent lawyers. Only then will they be able to reinstate the rigorous examination of patents that prevailed before the recent gold-rush atmosphere developed.

With their specialized training, engineers stand in a unique position to make an important political difference in this situation. Consider writing your U. S. senator or congressman about this matter, and see what happens. The worst that can happen is nothing, and the best could be a lot better than that.

Sources: The New York Times article "In Silicon Valley, A Man Without a Patent" by John Markoff was published online on Apr. 16, 2006, and is available from the NYT archives at http://select.nytimes.com/gst/abstract.html?res=F20811FA3D5B0C758DDDAD0894DE404482 for a fee. The Forbes.com article "More Patents Rejected in BlackBerry Case" by Arik Hesseldahl is at http://www.forbes.com/business/2005/06/22/rim-patent-infringement-cx_ah_0622rim.html.