Patently Messed Up

by Colin Berkshire
Colin here. What is innovation? It’s a simple enough question, except that it is not.
Most innovation is synthesis of other ideas. Rare is there something entirely new that is invented. (And even then the argument can be made it is just synthesis.)
And, is something really innovation if five other people come up with it concurrently? Perhaps when that happens the idea was simply ripe. Nevertheless, under our messed up patent system, the first of these gets the patent.
The most famous of these concurrent inventions is Alexander Graham Bell. He filed a patent application for the telephone. Hours later, Elisha Gray filed a patent for the telephone. Today, Bell gets the credit for inventing the phone, not Elisha Gray.
But here is the intesting part: many years earlier L.M. Ericsson invented the telephone. Bell wasn’t first by a number of years. But communications between Europe and the US was scant, and so the Bell patent was never successfully challenged by the prior Ericsson telephone. The facts are that Bell wasn’t first. A Canadian also has claims to having invented the telephone prior to Bell, but that is yet another story…
(Elisha Gray went on to patent numerous improvements to the telephone and he created a vast manufacturing and distribution company that was later acquired by AT&T. That company was Western Electric!)
Now, consider what many believe to be one of the great Apple inventions: the MagSafe power connector. It’s an ingenious plug on the back of Apple laptops that holds the connector on using magnets. Thus, tripping on the power cord releases the magnets and the laptop doesn’t come crashing down. It’s elegant and clever and distinctly Apple. Except, it’s not.
Anybody who has traveled to Asia has encountered a common electric tea kettle. All of these have MagSafe power connectors. It prevents scalding hot water burns when tripping on the power cord. And, tea kettles have had MagSafe connectors for just about forever in Asia.
So the unique, novel, creative Apple MagSafe connector is, well, a rip-off of something quite common in Asia.
This brings up the question of innovation. What is innovation?
Is the Apple MagSafe power connector really that innovative? A lack of knowledge about the rest of the world makes it seem so. But it’s not that innovative, really. Ignorance is a key ingredient of making something seem innovative.
This all leads us to the berserker US patent system. We issue patents for the most un-innovative of things. For a filing fee of a few hundred dollars you can get a patent granted. It then costs hundreds of thousands of dollars to defend against such patents. When a patentee is leveraged 100:1 against a defendant a system is bound to be abused and messed up, like ours is.
These trivial patents wouldn’t be issued at all if it weren’t for the key ingredient called “ignorance.” The patent office defends its ignorance by claiming there is so much information it is just hard to really know what is unique and innovative. They can’t search and find it all. This is bureaucratic-speak for apathy. This apathy is understandable because, you see, the patent office is entirely funded by patent renewal fees. The patent office receives regular and substantial fees of every patent to keep them alive. So if the patent office actually did its homework and denied most of the patents it would be slashing it’s own funding wrists. If You have ever wondered why the patent office grants so many utterly bogus patents now you know why: it is profitable for them to do so.
Of course, sympathy might be due the patent office because finding all prior art is challenging. Except, it is not. Here’s a simple solution…
Today, patents are published when they are filed. (This actually takes about 18 months.) the public can see them. But the public is prohibited from commenting on them. If you see a published patent application that is bogus (we’ll call it MagSafe here) you cannot provide the patent office with examples of the prior art. You cannot add to the “File Wrapper” as it is called in the patent trade. Your inability to share your knowledge results in the patent office being unnecessarily ignorant.
Even after a patent has been granted, you still cannot add prior art to the File Wrapper. Thus, patent trolls extort huge royalty ransoms. The math is simple: defending against a bogus patent costs hundreds of thousands of dollars. If a patent troll asks merely for $50,000 it isn’t worth fighting. The licensing “offer” from a patent troll reads approximately like this (translated into plain English.)

You know and we know that our patent #8765432 is bogus. Thousands of others on the Internet also k ow it is bogus. So what? We will give you a choice: license it from us for $50,000 and we will not bother you again over it. Or, we will sue you and it will cost you an average of $500,000. You may then win, but you will be out the money defending yourself. We won’t owe you anything if we lose. We have more patents to assert, so the loss of one of them is no big deal. And the cost of asserting the patent against You will cost just a few of the royalties paid by other companies. (And, if you do invalidate the patent those companies will not be legally entitled to a refund, so they have no incentive to help you. In fact, they have paid us and have every incentive to hurt you, since you are probably their competitor.)

Yes, this is the very essence of the typical licensing offer. I will not mention the name of Nathan Myhrvold in any more of this discussion. But he runs an especially large patent licensing racket in my personal opinion.
So should the MagSafe connector be patented by Apple? Should Bell have been granted the patent on the telephone? What really is innovation? And, are patents important?
Let me suggest ways of fixing our very broken system:
1) Shorten the patent terms. Let me argue that patents are minimally needed anymore. While constitutionally protected, the constitution doesn’t dictate how long they should be for. Over the years, the term of issued patents has increased to 20 years. Really, does a patent need to be longer than five years? If a company has had five years to monopolize a technology isn’t society better off allowing others to improve upon the technology and utilize it? I might arrogate for a three year monopoly. Certainly, 20 years is absurd.
2) Allow public disclosures. The public should be allowed to file prior art on both pending and issued patents by submitting it to the patent office with perhaps a nominal fee such as $10 to cover the scanning and storage costs. This would help the patent office throw out bogus patents, and would help defendants in defending themselves. All were doing through this type of disclosure is reducing ignorance.
3) Looser Pays Fees of the Winner. Europe and other regions have a legal system where the winner in a lawsuit is reimbursed by the looser. The thinking is that the parties should be certain that they are right before litigating. Right now, a patent troll can extort a company simply because of the high cost of defending oneself. If a patent troll had to reimburse a company for their defense legal fees if the troll was wrong then they would be very careful to not sue unless they were right. And, doesn’t that seem fair? Fewer innocent people and innocent companies would be harmed through patent troll extortion.
4) Concurrent invention equals obviousness. When two inventors file a patent on the same thing, a complex and costly process is started to determine who was the first actual inventor. This is called an “interference proceeding.” But, if two persons invented the same thing at the same time wouldn’t that really imply that the invention had simply become ripe and was obvious given the current state of the art? Thus, patent applications should be kept sealed for a duration of time such as six months. If two investors file for the same invention during the sealed period the invention should be automatically deemed to have been obvious. The patent should not be issued at all.
These four changes would significantly fix our highly broken patent system.
Now, it’s time for a cup of tea. I hear the water in the kettle is ready.