State of Innovation

Patents and Innovation Economics

Open Letter to Inventors from Randy Landreneau

Dear Inventors,

 

The Senate is about to take up the America Invents Act.  It is possible that this act will be the first thing addressed when they return to work Tuesday next week, September 6th.  A motion for cloture has been filed, which means a very limited debate if the motion gets a three fifths vote.  In this event, we could see the final vote on the bill take place next week.  Here’s the short version of what is wrong with the bill.

 

  1. The America Invents Act Will Increase The Time It Takes To Get A Patent: The biggest problem of the patent office, some say the only problem, is the time it takes to get a patent – 3 years plus on average and increasing.  Held-up patents mean held-up jobs, business ventures, and dreams.  At a time when the patent office needs every penny it receives in fees to improve its ability to handle its workload, fees are being stolen by Congress ($100 million this year alone!).  The only thing in the bill that would have helped reduce the backlog was the original Senate version’s guarantee that all of the fees paid by inventors to the patent office would be only available to the patent office.  The current House version put the Appropriations Committee back in charge, the same group that has been responsible for taking inventors fees.  In the face of current deficits, fee diversion will undoubtedly continue.  The only thing that would have helped reduce the patent backlog is gone now.

 

The change from First-to-Invent to First-to-File will create a rush to file that will increase the patent backlog, further increasing the time it takes to get a patent.  This belief is borne out by what happened in Canada after a similar change.

 

  1. The America Invents Act will Reduce Job Creation: Census data has shown that net new job creation in the US over the last 30 years comes from startups.  Large companies tend to export jobs.  If you compare the US to Europe, you know that the US has had more entrepreneurial activity than Europe.  The US has produced more groundbreaking technologies.  The First-to-Invent Patent System of America supports entrepreneurship and the First-to-File systems of Europe do not.

 

In a First-to-File system, the risk of another person filing for the patent before the initial inventor causes inventors to have to greatly reduce any communication with outside parties regarding their inventions.  Individual inventors, who are the greatest source of real innovation, usually need to work with others in research, development, funding, and marketing prior to filing for a patent.  Large companies, on the other hand, can often do everything needed within their walls.  In America, historically, an individual inventor could work toward making an invention successful without having to be nearly as secretive as a European inventor.  In First-to-File countries, inventors have a great incentive to not disclose an invention to anyone prior to a patent application being filed, leading to under-researched, under-developed inventions, and weaker patent applications.  Putting such burdens on individual inventors greatly reduces innovation.  This is a big reason why America has had a multitude of new technologies and new companies while Europe has been dominated by old companies and vested interests.

 

A friend who was an engineer at a large, well-known electronics company in America told me that if any employee came up with an invention that was too good, it got shelved.  The reason was that it would upset current product lines that are profitable.  Vested interests do not want someone coming up with an invention that will compete with them.  This is why large companies have been trying to change our patent system for many years.  The irony is that many of the large companies supporting this bill can be traced back to one innovative individual who was supported by the American First-to-Invent Patent System in his pursuit of the American Dream.  If innovation and job growth are the goal, changing from First-to-Invent to First-to-File makes no sense at all.

 

  1. There is much more.  Corporate attorneys will have an additional expensive procedure to use to challenge issued patents and will use it to wear down and defeat potential competition.  Past requirements that attorneys and inventors act “without deceptive intent” are repealed in the bill (!).  Companies will be able to keep trade secrets for as long as they want, hiding the information from the rest of the world, but still retain the right to keep making or using the product if someone else patents the invention, and will even be able to get a patent on the Trade Secret at any point in the future.  Harmonization is not only not accomplished with the bill, but there are situations where the bill creates disadvantages for American inventors relative to inventors from other countries (prior art cutoff date for obviousness).  Section 18 sets up a special procedure for challenging the validity of business method patents, under a weaker standard than any other kind of patent (a gift to big banks so they don’t have to worry about the valid patent of Claudio Ballard – if you don’t know the story, look it up and prepare to be outraged).  If you want more, go to www.SanePatentReform.org.  If all of the above weren’t enough, Thomas Jefferson, himself, opposed a similar change to First-to-File over 200 years ago, and many legal experts have stated that the proposed change is unconstitutional.

 

As usual, the odds are against us.  But that has been the case with virtually every decent effort any man or woman ever embarked upon.  Many saints were viciously killed by their numerous detractors.  Since we’re inventors, how about Galileo?  For publicizing his discoveries, he was tried for heresy by the Inquisition, threatened with torture, sentenced to house arrest for life, and not even absolved of his “crimes” until 1992!  You may not know that in our American Revolution, only about 1/3rd of the colonists were even for it.  The odds were phenomenally bad.  We won only through the efforts of heroic individuals, and we can win again here.

 

The America Invents Act is an example of the worst of politics and influence.  The result of its passage will be less innovation, fewer jobs, and a worse future for America.  But amazingly, many of the politicians who are about to vote on it know very little about it.  Their large company supporters are saying to vote for it, and the few of us fighting it are being drowned out.  The only way we can stop it is to call our Senators and educate them.  I am convinced that most of our Senators are sane enough to understand the issues if someone tells them.  Please call your senators and communicate the truth to them.  You can make a difference.  Do it because it is right.  Help defeat this bill.  Call this week (to find your Senators, go to http://congressmerge.com/onlinedb/).  Don’t wait, it could be too late.  Thank you.

 

 

Best Regards,

 

Randy Landreneau, President

Complete Product Development

www.CompleteProductDevelopment.com

 

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September 1, 2011 - Posted by | -Law, Patents | , ,

1 Comment »

  1. Please keep me informed.

    Comment by Robert Noyer | May 15, 2014 | Reply


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