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Judge Posner: U.S. patent system out of sync

339 points| sutro | 13 years ago |chicagotribune.com | reply

120 comments

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[+] kenjackson|13 years ago|reply
Posner's right. It seems that there needs to be some new notion of what constitutes patentability.

Drugs are an interesting case as they have these factors going for it:

1) Expensive to bring IP to market. Lots of testing and clinical trials for drugs. For SW it is pretty cheap now.

2) Easy and cheap to copy. Generic versions can be reverse-engineered quickly. Probably just as easy to copy software, but I still feel like this is probably a useful pillar.

3) The IP by itself constitutes the majority of the value of the product. In medicine there isn't typically tons of other IP around that come together to form the product. In SW there is rarely a single piece of IP that is more than a small fraction of the value of the product.

4) The IP has longevity as a standalone product. Viagra can be sold for decades. Aspirin still probably does hundreds of millions in revenue. There is little SW IP that, by itself, has longevity. The nature of SW is to continuously improve it.

5) Time to market isn't a huge advantage. Since most medicine is just sold as effectively a commodity, being 6m ahead of your competition usually just means you have 6 extra months of revenue. Whereas in SW it also means that gives you 6 months to build on your current IP. In medicine you don't typically do Viagra 2.0, with a boatload of new IP that makes the original obsolete (and hence any competitors shipping the old version scrambling).

[+] btilly|13 years ago|reply
People love to cite drugs as being a case where patents work well. But patents are far from a perfect fit for this problem.

Among other reasons, in an industry that is entirely dependent upon patent protection to defray the costs of getting FDA approval, it is impossible to get treatments through the approval process when they are not covered by patent.

For example somewhere on the order of half a million people in North America have Crohn's disease. This is a rather nasty sickness that destroys quality of life, and requires lots of rounds of only marginally effective medication. Research indicates that hookworm infection is an effective treatment. The FDA has decided that this treatment requires their approval. But you can't patent hookworms, and therefore nobody will pay for the necessary tests to get FDA approval. And so a half-million people continue to suffer.

If the rules were changed to grant a temporary monopoly to the company that got FDA approval for a treatment, this problem would vanish. A number of known treatments would go through trials and get approved.

[+] ok_craig|13 years ago|reply
I don't disagree with these points, but my personal take is that the primary difference between software patents and other patents is that most things that end up getting patented in software are things that pretty much any programmer may implement in the course of trying to solve some problem. The patented algorithms often aren't novel or unique, but someone just stood up first and said "Look here what I did. I want a right to exclusivity on this." Even though someone trying to get to the same end goal at some point in the future probably would have easily developed the same method.

In drugs, the end result gets patented. Some chemical formula that's just right, which (in most cases) was not simply stumbled upon in the pursuit of something else. And even if it was stumbled upon, it's still novel and was not likely to be created as a product or byproduct by another party very easily. The insight required to develop the drug was most likely unique.

The equivalent to most software patents today in the drug field would be patenting methods of, say, mixing chemicals. Imagine if there was a patent on mixing two solutions by pouring one from a beaker into the other in a flask, twirling around twice and then shaking gently four times. What if someone had a license to that mixing method and everyone else had to pay to do it? It'd be ridiculous. It seems like that's basically what software patents are.

The equivalent to drug patents in the software world would be, I guess, patenting an entire OS, or an app, or some fully integrated, significant piece of software. For example, no one should be able to make a counterfeit copy of iOS as a whole and sell it as their own. That I would support legally. I (think?) this is already covered by copyright law.

[+] Cushman|13 years ago|reply
> In medicine you don't typically do Viagra 2.0, with a boatload of new IP that makes the original obsolete (and hence any competitors shipping the old version scrambling).

Actually, there is an entire class of drugs known in medicine as "patent extenders". Take your expiring patented drug, alter the formulation, or attach an unnecessary chemical group that doesn't affect the mechanism of action, et voila! Twenty more years of monopoly.

As a result of this, there are drugs which were prescribed twenty years ago that are no longer available-- since the original developer has moved on to an "improved" version which may be less effective, while the generic version is not profitable enough to be widely available.

What this means for intellectual property, I'm not sure. It's a tricky issue.

[+] kaffeinecoma|13 years ago|reply
John Siracusa recently covered patents on his Hypercritical podcast: http://5by5.tv/hypercritical/68. Nice dissection of the idea of drug patents as being "special" (vs other kinds of patentable IP) in there as well.
[+] exDM69|13 years ago|reply
The society needs to find a new way to give incentives for drug development. Patents may seem to solve the problem from the drug company's point of view, but it keeps the price of drugs prohibitively high for the less fortunate of us.

So there are billions of people in the world who are left without medication or use wrong medication because of intellectual property licensing and pricing issues. This leads to unnecessary suffering and other bad things like antibiotics overuse (particularly in India) and drug-resistant strains of deceases.

[+] tzs|13 years ago|reply
On the other hand, with drugs you have the problem that for the 20 years that the patent owner has a monopoly, the price to consumers is high compared to after the patent expires and the generic version becomes readily available.

People can die during this time because they can't afford the drug.

A possible solution:

1. Add to drug patents a compulsory license, allowing anyone to make the drug provided they pay a royalty determined by statute to the patent owner.

2. This royalty rate would be low enough that the generic drugs are cheap--maybe 5 to 10% more than they would be if there was no patent.

3. This would make it harder for the patent owner to recover their costs over the life of the patent. We want them to recover their costs (and make enough to finance developing more drugs) so need to do something to counter this. We can do this by making the patent term longer for drug patents. Instead of 20 years, make it something like 50 years or 75 years or even 100 years.

We all win with this. The drug companies (as long as they are in it for the long haul) make money when they put in the effort to develop new drugs, but the patients get the drugs at an affordable price right away instead of waiting 20 years.

[+] ZeroGravitas|13 years ago|reply
You missed "clear property boundaries" as a difference. It's very easy to tell if a chemical compound is being used by two different firms, it's the equivalent of the source code being identical. But for software patents, there's much more subjectivity involved, e.g. does your patent cover this type of swiping, even if it doesn't in reality could you possibly convince a jury of ordinary people of that fact?.

This ambiguity is bad in itself. You might not like the chemical patent, but at least you'll know for certain whether you infringe it or not, which saves a lot of court battles.

[+] haberman|13 years ago|reply
As much as I love seeing some straight talk on the patent issue, it seems dangerous for a judge to have the appearance of injecting his opinions about what laws ought to be into the judicial process. He specifically requested to be put on a high-stakes patent case, then immediately threw the case out and started making public and vocal arguments against patents in tech?

I'd love to see him be our champion for sanity for this system (since our squabbling legislature can barely keep us from defaulting on our debt, let alone tackle patent reform), but this just seems to draw a huge target on his back for complaints of "judicial activism."

[+] brlewis|13 years ago|reply
Here's a list of what compels people to complain of judicial activism:

1. They disagree with a court decision.

I don't think it makes a measurable difference whether he draws a huge target on his back or not.

I would hope as a professional judge he would have a strong interest in law. Naturally he'll have opinions about it, whether he talks to the press after the case is over or not. So long as the written court opinion cites the law as it is now, I actually like having personal opinion added later.

Professionally, judges have to think about what harms people and what serves their interests. There's no way a human judge could avoid having this spill over into thinking how laws harm people and serve their interests.

[+] jlarocco|13 years ago|reply
Yeah, I was thinking the same thing.

It's convenient that I agree with his opinion, but I'm a little uncomfortable with the way he's going about things.

[+] ubernostrum|13 years ago|reply
Keep in mind that patentability of software is not something that was ever explicitly laid down in law by Congress. Rather, it came from a combination of the Patent Office deciding to issue them and courts issuing opinions on whether existing law allowed it. Absent changes to the law from Congress, the Patent Office and the courts can just as easily change their minds about how to interpret the law.
[+] user49598|13 years ago|reply
Laws aren't god given. They are to be interpreted or even ignored by anyone who finds themselves in the legal system. Thats why jury nullification exists, and thats why judges have jobs. At the end of the day it's just humans making decisions about other humans and if your firm belief is not in line with the law you have the opportunity to express that.
[+] georgemcbay|13 years ago|reply
We don't need patents in any industries at all if you judge them based upon their original intent -- to further the public knowledge (the temporary monopoly was meant to be a reward for that, not the main reason for patents).

It is difficult to overestimate our combined ability to reverse engineer virtually any type of product made these days and in that sense patents aren't very useful anymore relative to their original purpose.

[+] StavrosK|13 years ago|reply
Wasn't their original intent to protect the inventor's R&D investment by ensuring that he would be the sole beneficiary of the invention for a time?

Easily reverse-engineering products makes the initial purpose even more necessary.

[+] josteink|13 years ago|reply
We don't need patents in any industries at all if you judge them based upon their original intent -- to further the public knowledge

Good to see this one mentioned. Most people seem to forget that the original intent for all "IP-laws" originally was to broaden the public knowledge and to ultimately benefit the public.

That private entities was incentivized with limited monopolies which they could use to profit was merely a means, not the goal. These days everyone takes for granted that the means is the goal and the original goal is long forgotten.

If the original intent hadn't been forgotten as well as it has at this point, I doubt we would have seen the massive expanse of "IP-laws" which we have seen these last decades. Heck, back in the days there was no such thing as "IP". People were rational enough to realize there is no such thing as "intellectual property" which you can possess in a meaningful way.

Copyright law, patent-law and all these "IP-laws" should be reverted back to their original intent. Unfortunately that is not going to happen.

The US has way too much invested in so called "intellectual property" to go back on this now. Look at the US these days. What brings in the money? Traditional industry? All gone. Manufacturing? All outsourced.

In fact all the US has left of value is "intellectual property". Think Microsoft, Apple, Google and Hollywood. Now imagine the current US without the likes of those, or a world where their "property" could be had by anyone at no cost. Where would the US be then?

For all the bad things IP laws brings about (and don't get me wrong, I do think they are bad) there is a reason the US (and mostly the US) is pushing so hard on copyright-law and patent-law and trying to divert us from their original intent by instilling the idea of "intellectual property" as a legitimate one in the public mind.

Right now, this so called "intellectual property" is the only thing the US have left.

[+] user49598|13 years ago|reply
One big problem I have with software patents is that they rarely contain any actual implementation. The whole point of a patent is that society grants you a temporary monopoly and you give society the intricate details of your invention.

Many patents these days get the best of both worlds. We give them that monopoly and they give not a thing back. I say if we're to have software patents, they need to all include working code. If the code doesn't produce your patentable idea, no patent.

[+] WalterBright|13 years ago|reply
As far as I know, before 1989 or so there were hardly any patents on software, and that didn't inhibit innovation or the breakneck pace of software development in the slightest.
[+] idspispopd|13 years ago|reply
I don't see patents, or patent defence as a problem. The problem is that patents are being granted for lowest-bar "innovations", which are leading to these cases by companies that are merely using it as yet another competition tactic. In tech we're seeing patent cases are over trivial, often minor, features which others can accidentally infringe upon without noticing.

Pharma is a different beast, it's much more difficult to have a low-bar pharmaceutical, usually by the time the work is done the medication far exceeds the threshold of patentability. (Patent exploitation does still happen, as others have pointed out with insincere drug enhancements.) It's not about regulating specific industries(which would be exploited), but rather about raising the bar on what is indeed an original invention.

The blame for this mess lay on the USPTO. The patent system is being run like a commercial entity. A granted patent will attract over $5,000 in fees to USPTO, a rejected patent will only garner $125, with much of the granted fees attributed to curiously undefined 'maintenance' cost.

http://www.uspto.gov/inventors/patents.jsp#heading-6

[+] sutro|13 years ago|reply
While it's encouraging that there's a growing awareness among enlightened individuals like Judge Posner that patents restrict innovation, the problem is due to get worse before it gets better, because the Patent Office itself believes that the key problem is that patents are not being issued quickly enough:

http://www.sfgate.com/business/bottomline/article/Effort-to-...

I'd like to see some organized demonstration and resistance from Silicon Valley to this new Silicon Valley Patent Office. Patents are a toxic waste polluting our tech economy, and the feds have decided to increase the flow of pollution.

[+] coopdog|13 years ago|reply
I think they're half right, the turnaround time for a decision is too long, but the solution is surely to turn away the obvious patents on day 1 to get them out of the queue and discourage further frivolous applications.

The cynic in me says that this is bureaucracy 101, where the bigger the problem, the more staff you need to solve it, the more staff you need to manage, the more important you become.. ergo the answer is to exacerbate the problem rather than solving it.

I've also heard that they don't get paid for appeals, so rejecting a patent is more work than accepting it, which could also be shaping the landscape.

Either way something is seriously messed up in the US patent office and it's effecting the world in a bad way.

[+] kenster07|13 years ago|reply
A patent holder should -never- be able to ban an entity from using an idea in one of their products, if our society's priority to maximize quality of life ('if' because it is clearly not a priority for certain entities).

The patent system needs to balance the need for an incentive to invent, with the goal of maximizing quality of life. The current state of the American patent system stagnates society on multiple levels:

1) Patents, in too many cases, are a prohibitive barrier to entry for entrepreneurs. We have a system in which entrepreneurs know that if an adequately wealthy corporation were to knowingly file frivolous patent lawsuit, the cost, time, and energy to defend such a lawsuit could threaten the life of a fledgling business. Such a system can only have a chilling effect on entrepreneurship and economic growth. Trying to improve the world should -not- feel like walking on a minefield, and until that is fixed, our economy is not receiving the full benefit of its entrepreneurs.

2) Another inventor may be able to use a patented idea as a component for a broader, more useful (patentable) idea. A patent holder should not be able to prevent the development of innovations based upon their own.

3) In many cases, the inventor is not the best producer of his own invention. Society, as a whole, is best off when the best inventions can be produced by the most capable producers, and a patent holder should never be able to prevent this optimal economic arrangement.

American society generally values creativity far more than productivity, as reflected not only in its patent system, but in its popular culture, heroes of industry, etc. But in terms the health and sustainability of society, and economic output, productivity is at least as important. If Americans don't collectively acknowledge this, broader economic, and ultimately geopolitical, consequences will continue.

As a minimal solution to reverse these trends, I would suggest that patent holders be stripped of the ability to prevent others from being able to use their ideas in a product, but should be able to retain the ability to charge reasonable royalties. Thus, our society may be able to approach a healthier balance between its need for innovation and production.

[+] MBCook|13 years ago|reply
Compulsory licensing may help in some areas, but the way things are going in the computer industry I don't think it would be enough. Even if you only charge $0.05 per unit, that can still be a big problem.

How many ridiculous software patents do you think something like a common smartphone must infringe on. If you infringe on 100 patents ("ability to tap on icon", "drag gesture to move things", "method for turning down volume", etc.) that's a $5.00 cost per phone. A low end phone may only cost $200 unsubsidized. If you only make $30 per phone, that's over 15% of your profits.

The core issue still exists. None of this would be as much of a problem if software patents were required to be much better defined and extraordinary, were granted faster, could be invalidated with prior art or independent invention, didn't last as long, and there was some sort of damage limit.

Right now, if the iPhone infringes on some patent that objectively covers 0.02% of the software on the phone, the patent holder can still go after tons of money. The damages aren't tied to the utility.

If Apple won the slide to unlock patent, and (due to the scope) could only win $0.001 per Android device sold... would they have still done it? What if (again, due to scope) they couldn't get an injunction on something so small?

[+] TwoBit|13 years ago|reply
I wonder if this is going to cause some companies to throw money at politicians to get rid of Posner.
[+] gersh|13 years ago|reply
He has a lifetime appointment as a judge. Only 9 judges have ever been removed in the history of the country. It isn't likely that he will be removed. They can just appeal his decisions.
[+] josephlord|13 years ago|reply
I largely agree with Posner about what the law should be but I have a feeling that he might be overturned on appeal for not following what the law is.

Valid patents are meant to grant the owner an exclusive right to manufacture or licence the technology described. Until this case I've not heard the theory that you can commercially use the patented technology without a license if the other side can't show damages.

In my view Google should have been given a little time to work around the patent but to have been required to do so. Actually the only way the law is going to get changed is if it properly enforced and its ridiculousness is made obvious to the public.

[+] DigitalSea|13 years ago|reply
most industries? No. Some industries? Yes. I am a firm believer that patents do not belong in software at all. They're used to litigate not innovate and how often has a developer truly come up with a software technique that isn't in some form prior art? Most of the things that Oracle was arguing in the Google case were in-fact techniques that have been used in mathematics long before programming ever became a viable choice as a career (the rangeCheck point in the case is a prime example).

I think patents should only be for actual products, something you can hold in your hand. People like Apple trying to patent things like slide to unlock are idiots, you shouldn't be able to patent a movement.

As it has been shown many times, software patent litigation is a joke. Patent something real or GTFO. Look at people like James Dyson the dude has tonnes of patents all mostly on real products and techniques for doing unique things in the case of Dyson suing for competitors stealing his patented methods of cyclonic vacuum cleaners that's a real patent lawsuit right there, not arguing over whether or not a swipe is a zero length touch.

[+] dk|13 years ago|reply
Actually Oracle only made two patent infringement claims against Google -- rangeCheck wasn't one of them -- and Google didn't argue prior art against either of them.

ETA: They argued non-infringement.

[+] Agathos|13 years ago|reply
Kind of funny that the Chicago Tribune turns to Reuters to report the opinions of a man who lives in Chicago.
[+] monochromatic|13 years ago|reply
Regardless of where one stands on questions of patent policy, it is ridiculous to praise a trial judge for ignoring binding precedent.

(Yes, I know Posner is an appellate judge. He was sitting by designation as a trial judge in Apple v. Motorola.)

[+] EGreg|13 years ago|reply
Software patents may indeed be unnecessary largely because software already receives copyright protection.
[+] antidoh|13 years ago|reply
Patents are for inventions, but software patents are used to insulate whole products from competition.
[+] aangjie|13 years ago|reply
Ok any TLDR versions? out of sync with what? what should it be synced to? Am generally not a fan of IP, but don't have time to read through the Original article.
[+] Fando|13 years ago|reply
Amen to this man!