Defending Patents Against Patents

Some news in the tech patent world yesterday, where Jared Favole and Brent Kendall reported in the Washington Post (Obama Plans to Take Action Against Patent-Holding Firms) that

The White House on Tuesday plans to announce a set of executive actions President Barack Obama will take that are aimed at reining in certain patent-holding firms, known as “patent trolls” to their detractors, amid concerns that the firms are abusing the patent system and disrupting competition.

Mr. Obama’s actions, which include measures he wants Congress to consider, are intended to target firms that have forced technology companies, financial institutions and others into costly litigation to protect their products. These patent-holding firms amass portfolios of patents more to pursue licensing fees than to build new products.

Original patent for the first pedal-driven bicycle, filed by Pierre Lallement

Original patent for the first pedal-driven bicycle, filed by Pierre Lallement

Specifics are thin, and we’ll have to see how things turn out over time, but this is a good sign. (For recent Congressional action, check out the SHIELD Act and the “Schumer-Kyl provision.”)   People from across the spectrum have been calling for revisions in the US patent system with regards to tech patents. Some critique the US Patent and Trademark Office, arguing that obvious and non-innovative things are being patented. Others suggest that patents are granted for things already existed, which kind of defeats the idea that patents should be granted for innovation. Frequently, the arguments are practical, suggesting that the USPTO either doesn’t have the time or expertise to really evaluate the merits of patents.  Others go deeper, saying that things like software and methods should not be patented at all.

But the biggest push for patent reform has been as a result of “patent trolls”. “Patent trolls”—or, as they prefer to be called, “non-practicing entities” because they don’t make any actual technologies—are companies that purchase patents from inventors, create a portfolio, and sue companies that they allege are infringing on those patents.Protecting legitimate patents through lawsuits is perfectly legal, of course. Moral even. But questions arise in cases where the validity of patents come into question. In some cases, the patents are still in process. In others, patents have been granted for dubious or non-original innovations and will likely fall on appeal. One strategy that trolls sometimes use is to sue over a whole host of patents, only some of which may prove valid.  This stuff happens all the time (for instance, for emailing scanned docsdoing in-store wirelesscell-based internet, online shopping carts, in-app purchases, and sending a call to voicemail). It is a growing, expensive problem.

Pretty much all the time, though, these companies want cash settlements. So it is all about enrichment, but not of inventors.

Some of these patents may turn out to be considered valid, and so reasonable. It is not always clear. Tim Wu had a great opinion piece Sunday on some of the complexity of the distinction between patent troll and patent asserter. But with so many cases that seem questionable—a podcasting patent that dates from 2012‽—things seem to be favoring owners to a problematic degree.

Why problematic?  Because underneath patent laws—copyright laws, too—are fundamental, yet competing, values that need to be kept in balance in order to maintain a just society.  On one side, you have the right to gain from the fruits of one’s labor. On the other side, you have the good of society in which that labor is done.  Notably, both of these figure into thinking about a key benefit of work, namely the right to property.

Property has long been understood as a natural right that enables human beings to flourish.  In a historically influential passage of his Summa Theologica (Part II-II, question 66, article 2), Thomas’ Aquinas suggested three fundamental reasons why private property is important: (1) human beings will work harder and more carefully when they are working for their own benefit, (2) groups run better when people focus on taking particular care of some particular things, and (3) groups run better when envy and jealousy are mitigated because people are happy with what they have (presaging Hobbes’ focus on quarrel as a fundamental reality of human life).

But importantly, notice there that only the first reason Aquinas sites is about the good of the individual person directly. The other two are about the good of the person as a consequence of a healthy society.  Put another way, the gains that we make from working pay off not just because we can buy stuff, but because they help make social relationships more stable. This is not insignificant, given the necessity of a functioning society for individuals to flourish (a notion that is as much a part of Aristotle and Maslow as Aquinas).

This same sort of perspective can be seen in the provision for copyright and patent in the U.S. Constitution.  In the list of enumerated powers in Article 1, Section 8, Congress is given the power:

To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;

We The People from the US Constitution

© Mdgilkison

Notice that the passage does not mention patents as a means for people to enrich themselves. That’s a nice secondary benefit. But the purpose of patents and copyrights are social in nature: to promote science and culture.  Today, we’d call that “innovation.” Societies are better off when people use their creativity to advance our common undertaking. True, some of that advancement is driven by the desire for personal gain (as Aquinas noted). And so patents protect inventors from other people becoming rich off their creations for a time.  But while personal gain may be a proximate goal of an individual’s work, the ultimate goal of the patent law is to promote the good of society. (1)

And that’s the challenging balance: to find the sweet spot between personal enrichment and social benefit.  With too much emphasis on protecting creators, the general climate for innovation evaporates and social cohesion in the industry erodes, so the benefits to society will be lost. With too much emphasis on benefits to society, the personal gains are no longer worth the work, so the motivation for the individual are curtailed.

Right now, that balance is out of whack.  We have patent protection so strong that people who have nothing at all to do with innovation or invention—and so absolutely nothing to do with creating or enhancing the public good—are enriching themselves by extracting money from some of the very people who are trying to do actual innovation! It makes sense to protect innovators. But it makes no sense at all to protect non-practicing entities, who—by definition—don’t actually contribute to society by innovating or producing. The take all of the personal benefit while creating none of the social benefit.  That’s the very definition of “out of balance.”

While what both the White House and Congress are proposing seem like modest first steps, they are first steps. It will be difficult to come to agreement on where the lines that indicate balance should be. Law is tricky, even when you have agreement about the values at stake, and we don’t even have those. But it is something we can’t avoid tackling.

If we could only do some copyright reform, too.  Then we’d be getting somewhere. But I don’t hold much hope in that during this administration.


(1) The point here is philosophical, not legal. I’m not a lawyer, and my guess is that the legal precedents have not necessarily followed this reasoning.  Yet, the philosophical underpinning is clearly there.

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