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  (Source: ICanHasCheezburger)
Judge Posner, regarded as a top expert on intellectual property, claims the nation's legal system is being abused

It's hard to visit DailyTech or other science or technology publication over the last couple years without having your eyes assailed by a steady stream of stories on patent litigation.  Indeed, as mobile device use has exploded so too has a stream of patent lawsuits, much of which cover areas like user interface design which were considered too ubiquitous to sue in past technology applications (e.g. traditional operating systems, games, the internet, etc.)

I. Judge Posner: Wake Up, the System is a Mess

The landslide of patent lawsuits isn't just a headache for companies and readers. It's increasingly drawing the ire of some of the U.S. legal system's most prestigious experts, who are arguing that companies are exposing flaws in current U.S. Patent Law, gaming the flawed system to achieve anticompetitive ends.

Among them is Judge Richard A. Posner.  A sitting judge on the Seventh Circuit Court of Appeals, Judge Posner occasionally moonlights in Chicago's U.S. District Court, Northern District of Illinois for crucial cases, a privilege earned by his glowing reputation and vast expertise regarding intellectual property law.  And as a foremost expert Judge Posner has been increasingly sounding the alarm regarding the broken intellectual property system in the U.S., which is essentially be used and abused as a tool for large competitors to try to damage each other, and unilaterally to block out smaller competitors.

Judge Richard Posner
Judge Richard Posner says the U.S. patent system is broken.
[Image Source: Abel Uribe, Chicago Tribune]

In his joint blog with University of Chicago Economics and Sociology Professor Gary Becker -- another top expert -- he recently posted a scathing review of the current law, writing:

When patent protection provides an inventor with more insulation from competition than he needed to have an adequate incentive to make the invention, the result is to increase market prices above efficient levels, causing distortions in the allocation of resources; to engender wasteful patent races—wasteful because of duplication of effort and because unnecessary to induce invention (though the races do increase the pace of invention); to increase the cost of searching the records of the Patent and Trademark Office in order to make sure one isn’t going to be infinging someone’s patent with your invention; to encourage the filing of defensive patents (because of anticipation that someone else will patent a similar product and accuse you of infringement); and to encourage patent “trolls,” who buy up large numbers of patents for the sole purpose of extracting licensee fees by threat of suit, and if necessary sue, for infringement.

The problem of excessive patent protection is at present best illustrated by the software industry. This is a progressive, dynamic industry rife with invention. But the conditions that make patent protection essential in the pharmaceutical industry are absent. Nowadays most software innovation is incremental, created by teams of software engineers at modest cost, and also ephemeral—most software inventions are quickly superseded. Software innovation tends to be piecemeal—not entire devices, but components, so that a software device (a cellphone, a tablet, a laptop, etc.) may have tens of thousands, even hundreds of thousands, of separate components (bits of software code or bits of hardware), each one arguably patentable. The result is huge patent thickets, creating rich opportunities for trying to hamstring competitors by suing for infringement—and also for infringing, and then challenging the validity of the patent when the patentee sues you. 

In so many words, what the Judge is saying here is that the U.S. Patent Law is being handicapped by the fact that it does not consider commercial importance or obviousness as a criteria for accepting or rejecting a patent.

II. Patenting the Obvious, Trivial

Why does this matter?

A company with enough time and money can patent every single tiny feature of their complete product, no matter how trivial or unimportant, and then use that vast portfolio to drag its competitors through the mud.

What's the line between a feature and an invention?  In the eyes of current Patent Law there is no real distinction.  And that's what's leading to the growing deluge of "junk" litigation.

For his part Judge Posner is trying to both sound the alarm and personally knock out bad cases that happen to come through his jurisdiction.  For example, seeing that Apple, Inc. (AAPL) and Google Inc. (GOOG) were simply trying to leverage their ubiquitous patent portfolios to harm the other, he twice threw their respective cases out of court [1][2].
Cave Troll
The "trolls" are multiplying thanks to the growing swell of junk patents.
[Image Source: New Line Cinema; Fair Use clause TITLE 17 > CHAPTER 1 > § 107]

However, Judge Posner is just one man, one who some would argue is one of the few fighting "the good fight" in a broken system.  Until that system is fixed, the abuses will likely expand as companies in other fields recognize how to use patents to transform a what society hopes is a free (capitalist) market into a closed (command) market, in which a select few power players seek to ban all would-be product producers.

Judge Posner suggests, "My general sense, however, bolstered by an extensive academic literature, is that patent protection is on the whole excessive and that major reforms are necessary."

He adds that copyright law is suffering from similar issues, although the mess hasn't (yet) reached some epic proportion as it has with patent law.  He concludes, "The need for reform is less acute in copyright than in patent law, but it is sufficiently acute to warrant serious attention from Congress and the courts."

Source: Beckner-Posner Blog

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By Siki on 10/3/2012 2:23:30 AM , Rating: 2
In so many words, what the Judge is saying here is that the U.S. Patent Law is being handicapped by the fact that it does not consider commercial importance or obviousness as a criteria for accepting or rejecting a patent.Text

Obviousness is supposed to be considered. The application must be deemed non-obvious to those familiar with the art.

Unfortunately, the weakest link in the IP system is the Patent Examiners - the people who initially judge an application for allowance. This is probably due to the huge backlog of work the USPTO has - more than a years worth. So, they seem to hire just about anyone they can get, and end up with quite a few that are inept. They need to focus on filling these positions with skilled individuals.

RE: Obviousness
By boobo on 10/3/2012 3:14:20 AM , Rating: 4
It's not just that the patent examiners are underskilled, it's that they are encouraged to accept as many patents as possible because the USPTO makes profit by volume.

More lenient evaluations => more applications

RE: Obviousness
By bupkus on 10/3/2012 3:16:47 PM , Rating: 2
It's not just that the patent examiners are underskilled, it's that they are encouraged to accept as many patents as possible because the USPTO makes profit by volume.
Is this to say that, heaven forbid, government should get involved where private enterprise has learned how to make money? Is this a path to more government regulation and bigger government? Don't you know that government messes up everything? Darn it my panties are in a twist.

RE: Obviousness
By thirdshop on 10/3/2012 8:04:37 AM , Rating: 2
Why would anyone with skill want to be an underpaid Govt. employee? The only thing worthwhile with being a civil service employee, the pension, is being attacked and reduced. Plus you get the added bonus of being the whipping boy of every individual with an axe to grind against the government and get the added privilege of being called inept, lazy, stupid and many other pejoratives. You yourself have stated that the backlog is over a year long. This has more to do with budget cuts than anything else. So tell me again, why would anyone work for the govt. unless they had to?

RE: Obviousness
By HrilL on 10/3/2012 3:50:14 PM , Rating: 2
Budget cuts??? really? You've got to be kidding. The Patent office has seen its budget increase through the past two administrations. Patents and Copyright are only supposed to be around to promote the progress in the useful arts. Patenting a rectangle is hardly what I would call useful, it is clearly obvious and it can also be found in nature... That was just one example.

RE: Obviousness
By deathwombat on 10/3/2012 6:01:36 PM , Rating: 2
If they want to increase the skill level of their applicants, they'll have to increase salaries. Hiring more or better examiners can't be the whole solution to the problem, because that just forces the taxpayers to pay more to support a broken system.

It simply shouldn't be possible to patent that is merely "not obvious". No one ever became a millionaire by coming up with a "not obvious" idea. Products don't succeed or fail on the strength of "not obvious" ideas. To be patentable, an idea needs to be brilliant. I'm not harmed when someone steals one of my not-obvious ideas; it takes a brilliant idea to succeed in a world with a thousand competitors. Only patent ideas that would actually harm the owner if it were infringed!

"You can bet that Sony built a long-term business plan about being successful in Japan and that business plan is crumbling." -- Peter Moore, 24 hours before his Microsoft resignation

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