Based on the reports in the post “Bilski Case Provokes Skepticism from Justices” it is clear that the Supremes do not understand patent laws or innovation economics.
It is unfortunate that the Supreme Court justices are so ignorant of patent law and innovation economics. Justice Sotomayor’s comment that patents in fact “limit the free flow of information” is complete nonsense. First, the information in the patent would not exist if the inventor had not created it. Second, patents trade the disclosure of information for a limited term property right. As a result, patents foster the creation and dissemination of information. Justice Breyer’s comment if everything that “helps a businessman succeed” is patent-eligible, it would “stop the wheels of progress” shows a complete ignorance of the history of patents and technological progress. Before the advent of the modern patent system in the US, technological progress was so slow that per capita incomes had not changed in over 2000 years. Since the advent of the modern patent system, we have had an unprecedented explosion in technological innovation.
The three major economic slowdowns in the US in the last 100 years, the 1930, 1970s, and this decade, can all trace there roots to the weakening of our patent system. In the 1930s and 1970s antitrust law was used to emasculate patents. For more information on the link between patents and economic growth see Foreigners Receive More Patents than US. In this decade the approach has been more subtle and includes the absurdly low patent allowance rates created by the inane patent quality measures under Jon Dudas. The Supreme Court’s decisions have weakened our patent laws in number of decisions including ebay and KSR. Finally, the legislature has broken the basic social contract involved in a patent. For more information see Intellectual Property Socialism.
Detractors of the Bilski patent application suggest that it is a business method patent. These people suggest that patents should not be allowed for business methods. However, the opponents never define what they mean by a “business method patent” and I would suggest that it is impossible to come up with a consistent definition of a business method patent. All patents are related to how a business operates. For instance, Edison’s patent on the light bulb was related to how his business was going to manufacture light bulbs. For more information on why the opponents of business method patents have failed to provide a logically consistent argument see “Bilski, Software Patents, and Business Method Patents.”
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