Patently Obvious: The U.S. Patent System Needs Major Change

Patent lawsuitsAfter reading one too many articles about patent issuance failures on the part of the United States Patent and Trademark Office, I’ve come to the conclusion that the USPTO just isn’t able to keep up with galloping technology.

How else to explain its staff lawyers granting patents for applications they have no business authorizing?

And when that happens, the courts have to step in and fix the problem – as in the recent U.S. Supreme Court case overturning the patents of Myriad Genetics on BRCA1 and BRCA2 human breast cancer genes.

Even worse … through ineptitude, completely obvious ideas get patented, inhibiting innovation and keeping beneficial technology out of the hands of the public – which goes completely counter to the USPTO’s stated aims.

One of the USPTO’s doozies that has made it into the news was issuing a patent for scanning a document and then e-mailing it.

That is correct:  the USPTO viewed this simple function as a “unique” invention worthy of patent protection.

… Never mind the fact that thousands of people had already “invented” this idea before – but never in their right minds would they have thought it was patentable!

So what happened after patent protection was granted in this case?  The patent is now owned by one of those infamous firms that exists only to sue people and extort money from them.  In this case, a company with the deliberately innocuous-sounding and forgettable name of MPHJ.

Today, this firm’s legal counsel is demanding $1,000 in licensing fees from anyone who scans a document and then e-mails it.

At least Hewlett-Packard decided to fight back earlier this year, pointing out that it had been selling printers that could scan and e-mail documents long before the patent in question was ever granted.

But why do we even have to go there?  Is it really appropriate for a patent to be granted to someone who didn’t really invent anything … nor create a new technology … nor develop a unique engineering design or manufacturing process?

Patenting ideas for computer-related functions and programs as falling under the general category of “business methods” – a dreadful practice the USPTO started allowing about 20 years ago – is partially how we got into this mess.

The unfortunate part is this:  There will be major challenges facing anyone who decides to promote patent reform.  Too many “patent trolls” and their partner-in-crime attorneys have a vested interest in a current system which – similar to the cyber-squatting industry – enables them to make a tidy sum for very little effort.

Expect these “upstanding corporate citizens” to obstruct any moves to change the system with the same kind of zeal they employ to go after the citizens and companies who are the hapless targets of their extortion efforts.

In fact, a 2012 study commissioned by the Government Accountability Office found that of ~500 randomly selected patent lawsuits that were filed the previous year, nearly 40% of the cases were brought by “patent monetizers” (trolls).  And that doesn’t even begin to account for the untold numbers of threatened suits that were settled without going to court.

But I’m pleased to see that several states have taken up the gauntlet in the MPHJ saga.  The attorneys general of Nebraska and Vermont have sent letters to the company and its legal counsel, warning them to leave their state residents alone.

Vermont has even passed legislation allowing victims of patent trolls to countersue.  Wouldn’t that be a nice turn of events?

Greed is never pretty – but especially when greed is this transparently obvious.  It would be nice if the USPTO started contributing to the solution by making some much-needed changes of its own.

2 thoughts on “Patently Obvious: The U.S. Patent System Needs Major Change

  1. We are talking here about “utility patents.” For these, the U.S. Patent Act says, “Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvements thereof, may obtain a patent …”

    Thus, by law a patentable invention must be new, useful and fall within the scope of the Patent Act (“process, machine, manufacture, or composition of matter”). Government patent examiners determine what is “new” by comparing the invention’s features to previous patents (“prior art”). If no single previous patent is found having all those features, then the invention is considered new (“novel”).

    But the invention must also be nonobvious, which to a USPTO examiner means that no combination of previous patents covers all the invention’s features. Otherwise it’s deemed to be an obvious combination of features found in prior art, and is not patentable.

    Scanning and e-mailing documents may not seem new, and may seem obvious to you and me, but if no patent was previously awarded for either or both features (“scanning” and “e-mailing”) then as far as an examiner is concerned the combination of scanning and e-mailing is both new and nonobvious, and is eligible for patent protection under present law. One way to fix the U.S. patent system would be an act of Congress requiring examineers to look beyond what is merely patented when determining prior art.

    Of course patent examiners are human beings who are capable of making mistakes like the rest of us, so they might have reached the wrong conclusion by overlooking a previous patent for scanning or e-mailing. That’s why the USPTO’s database of pending applications is available to the public online and anyone taking the time to read it can file an objection. If anyone out there knows a better way, I’d like to know what it is.

    As for patenting computer-related functions and programs, these are clearly “processes” within the meaning of the U.S. Patent Act. Fixing this would also require Congressional action.

  2. Now wait a minute: Surely, someone owns patents on scanning technology, and manufacturers of scanners pay to license that technology.

    It is understood that buyers of scanners will scan, i.e., create digital files of paper documents and do so without paying additional royalties. To charge a $1,000 fee for the electronic transmission of scanned documents when bazillions of other files are electronically transmitted daily free of charge would almost certainly violate existing federal law that prohibits undue burdens being placed on commerce.

    Supreme Court justice John Paul Stevens wrote: “[a] burden may be ‘undue’ either because [it] is too severe or because it lacks a legitimate, rational justification.”

    To sort out this particular case — and I suspect others — I don’t imagine you’d need an act of Congress, just a reasonable federal judge. But an act of Congress to bring some sanity to business-model patents would be useful.

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