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Archive for November, 2011


Mark Twain’s Birthday: Thoughts on Patents

Today is Mark Twain’s 176th birthday, which makes it a perfect time to review some of his thoughts on the patent system.  Mark Twain wrote extensively about the patent system.  In the book, Innocents Abroad, he explains the virtues of our country and moral decay of Europe by contrasting the patent system to the preservers of art.  Remember, Twain was first and foremost an artist and he held this opinion.  He states:

The Popes have long been the patrons and preservers of art, just as our new, practical Republic is the encourager and upholder of mechanics.  In their Vatican is stored up all that is curious and beautiful in art; in our Patent Office is hoarded all that is curious or useful in mechanics.  When a man invents a new style of horse-collar or discovers a new and superior method of telegraphing, our government issues a patent to him that is worth a fortune; when a man digs up an ancient statue in the Campagna, the Pope gives him a fortune in gold coin.  We can make something of a guess at a man’s character by the style of nose he carries on his face.  The Vatican and the Patent Office are governmental noses, and they bear a deal of character about them. (Emphasis added)

In the last fifteen years we have extended the copyright term to be almost infinite, we have criminalize willful copyright infringement and we have had numerous government programs to protect intellectual property, which always means copyrights and perhaps trademarks, but not patents.  Alternatively, we have spent the last fifteen years stealing the fees inventors pay to the patent office, we have forced the publication of U.S. inventors’ patent applications for the world to see and steal, we have vilified the actions of our greatest inventors such as Edison, calling them trolls and some have even suggested that Edison really made incremental improvements on other people’s inventions, and called inventor’s monopolists.  Twain would be horrified by our capitulation to Europe.  It says something about our character that we are following in the Popes footsteps.

 

 
US Brain Drain

I have been predicting that the United States is suffering a brain drain.  I have reported on this phenomena several times including my post Phil the Expat, which discusses a highly skilled scientist moving to Belize and Exodus From the US, which discussed a person with strong marketing and computer skills moving to Argentina.  Well I now have another story to add to the US brain drain. I just meet a person who was a professor at an Ivy League school in the school of Medicine.  He has decided to move to New Zealand to start a company around some new technology he has developed for the medical field.  Just over a decade ago it would have been inconceivable that you would leave the US to create a technology startup.  Now SOX has killed off the venture capital market in the US and the patent system is so bogged down that your company can die a thousand deaths before the Patent Office issues a patent.  We are no longer the land of opportunity for highly skilled and motivated people.  This is a bad sign for the US economy and for our future.

 

 
Patenting Life

Deadly Monopolies: The Shocking Corporate Takeover of Life Itself–And the Consequences for Your Health and Our Medical Future, by Harriet A. Washington

There have been several books suggesting that you can patent human genes or parts of humans.  The latest is entitled Deadly Monopolies, which appears to be a rehash of David Koepsell’s Who Owns You?: The Corporate Gold-Rush to Patent Your Genes.  The first person to raise this issue was Michael Crichton.  None of these people are patent attorneys and they all misinterpret the claims of patents to be broader than they are.  We know Ms. Washington does not understand patents, because she mislabels them as a monopoly in the title of her book.  Ms. Washington also does not understand property rights.  Patent are property rights and you obtain title to your invention because you created something.  Monopolies are granted based on political decisions.

In Washington’s blog, she suggests that Myriad Genetics has patented a part of John Moore’s body.  This is clearly incorrect on its face.  The patent is for an isolated form of a gene that is an indicator of breast cancer.  The critics of gene patents have made this outrageous accusation that a patent covers a part of your body.  With the implication that just by being alive you are violating their patent.  This is complete nonsense, but great propaganda.  It appears that Ms. Washington really adds nothing to the discussion, but is just rehashing points that have already been made and proven wrong.

The Court of Appeals for the Federal Circuit when ruling on the Myriad case provided the following insights “Isolation of a DNA sequence is more than separating out impurities: the isolated DNA is a distinct molecule with different physical characteristics than the naturally occurring polymer containing the corresponding sequence in nature.” (P. 11 Slip Opinion – Judge Moore) He further states, “I decline to extend the laws of nature exception to reach entirely manmade sequences of isolated DNA, even if those sequences are inspired by a natural template.” P. 14 Moore.  He further explains the difference between this case and purified vanadium or uranium as, “Given the chemical differences highlighted by Judge Lourie’s opinion and discussed supra, the mere fact that the larger chromosomal polymer includes the same sequence of nucleotides as the smaller isolated DNA is not enough to make it per se a law of nature and remove it from the scope of patentable subject matter.  The actual molecules claimed in this case are therefore not squarely analogous to unpatentable minerals, created by nature without the assistance of man.” P. 15 Moore.  Harriet Washington, seems to have ignored all this information or simple does not understand the science and certainly does not understand the patent law.  I attempted to find out about Washington’s background to determine if she had a scientific background.  The only information I could find was that she had been a medical ethicist at Harvard, but nothing about her education.

While I have not read the book, Deadly Monopolies: The Shocking Corporate Takeover of Life Itself–And the Consequences for Your Health and Our Medical Future, by Harriet A. Washington, all indications are that the author does not understand the science or the law involved in this topic.  Her statements on her blog that gene patents spur profits not cures is example of the shallowness of her research.  See David E. Adelman & Kathryn L. DeAngelis, Patent Metrics: The Mismeasure of Innovation in the Biotech Patent Debate, 85 Tex. L. Rev. 1677, 1681 (2007), as clearly showing biotech patents have resulted in increase innovation.  Washington’s book is not about science, the law, or the truth, it is a propaganda attack on patents, property rights, and the pharmaceutical industry.

 

 
Why Government Funded R&D Cannot Replace the Patent System

It is quite common for academic economists and others to suggest that the incentive of the patent system could be replaced with government funding of Research and Development.  In fact, this argument was made by Mayo in their brief to the Supreme Court in the Mayo v. Prometheus case.  These academic economists often complain that patents lead to rent seeking and are monopolies.  There are two fundamental flaws in their arguments.  One is that patents are a property right and protection of property rights is not only necessary for economic growth (see the Frasier Institute and Heritage/Wall Street Journal survey of economic freedom), but necessary for a just society.  Second, the real rent seeking happens when governments attempt to fund R&D and act as a source of venture capital as two excellent articles showed this week.  Solyndra is only the latest in a long line of failed government investment that prove this point.

Almost every major technological advance made in the US was due mainly to property rights provided by the patent system.  These property rights made it possible to invest in creating and deploying these technologies and without the patent system they would never have made it into the marketplace.  Among these technologies are the telegraph, the telephone, the technology behind drilling for oil, the technology of fracturing oil, the airplane, the copy machine, radio, television, the computer industry, the electronics industry, and yes the internet.  While DARPA can claim that their funding creating the basic building blocks of the internet, it did not create the advances that were necessary to make it a viable commercial product.  The Patent Office is a totally self funded agency, which means it receives no federal tax dollars.  The American people received this benefit without any cost to themselves.  For those who argue that there were social costs to these patents, please look at North Korea or the USSR and see the true costs of a patent system.

What great technologies can government funding claim?  The atomic bomb, sonar, some improvements in radar, and some credit for getting the American System of Manufacturing started.  Government funding is good at creating weapons technology, which is a legitimate role for government.  Two great articles point out the fallacy of government replacing the patent system.  One is Before Solyndra, a long history of failed government energy projects, By Steven Mufson. Mr. Munson documents the abject failure of government investments in the energy field.  These failed investments represent tens of trillions of wasted taxpayer money.  The article points out that:

Not a single one of these much-ballyhooed initiatives is producing or saving a drop or a watt or a whiff of energy, but they have managed to burn through far more taxpayer money than the ill-fated Solyndra. An Energy Department report in 2008 estimated that the federal government had spent $172 billion since 1961 on basic research and the development of advanced energy technologies.

Another great article showing the fallacy of government investment is Solyndra Case Reveals Gateway Between Administration Loans, Obama Allies.  This article points out that “government investment” is always politically connected.  According to the article “This is a payoff to people who are your political backers and supporters. And this is really a wealth transfer from middle class taxpayers to billionaires, Schweizer said.”  Schweizer is author of the book, “Throw Them All Out,”   This is the system that these academic economists suggest can replace the patent system.  This is the system that is suppose to replace the supposed “rent seeking” of patents.

 

 

Wireless technology has been proved to be a boon for the internet connectivity. It is surely convenient to one and all, but when the connecting speed goes down, nothing can seem to help you. The signal of a Wi-Fi computer network is something that can be improved and boosted up in many ways. To know them all, read on the following.

Reposition the router or access point

This is done in order to escape from radio interference and obstructions as well. The two of these are majorly responsible for reducing and affecting the range of the equipment that serves for Wi-Fi connection. Cordless phones, microwave ovens, brick and even plaster walls are a few residential sources which serve as immediate barriers in creating interference in the connection. The solution to avoid this interference is to change the number of Wi-Fi channel and this is done on the Wi-Fi equipment itself.

Upgrade the antenna on the router

The stations with a wireless base have Wi-Fi antennas. These antennas have the option to be removed and thereby a more powerful antenna can be fixed whose range is much higher.

You may add some other access point or router

The residential areas that are typically large do have to go for two or a little more access points (AP’s). And when it comes to a business house, then the need can turn up to more than a dozen of access point as the range has to be too large. This is much simpler when it comes to a home. All you are required to do is to connect the primary access point (or the wireless router) to the other with the help of an Ethernet cable. The wireless router or the AP’s that are employed at home are the ones which do not reciprocate with each other through a direct contact.

Employ a bi-directional Wi-Fi signal amplifier

The Wi-Fi signal amplifier is fixed to the wireless device. This Wi-Fi signal amplifier is also known as a “Signal Booster” because it boosts and amplifies the signal. The signal booster is simply fixed to either a Wi-Fi client or a router or to the access point. And the antenna is connected to any one of these. There is a particular point where the antenna has to be connected. The purpose of employing bi-directional antenna is to amplify the signal which is wireless in receiving and transmitting directions. The Wi-Fi transmission of this kind is known as two-way radio communication.

Add a Wi-Fi repeater

A Wi-Fi wireless repeater is a device which has to be positioned in such a way that it falls within a certain range of access point or wireless router. Infect, it is a stand-alone unit as a whole. The repeater is also known as range repeater sometimes. The function of this range repeater is to work like a double way and relay station for all Wi-Fi signals. The clients who really lie at a far distance from the original wireless router or AP have a good option to set up a link to the WLAN using the repeater.

 

 

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About the author: Rebecca is a blogger by profession. She loves writing on environment and technology. Beside this she is fond of reading about new gizmos. Recently an article on Music Systems caught her attention. These days she is busy in writing an article on perfect evening dress for dinner.

 

 

 
Washington Post Suggest Producers and Parasites are Interchangeable

Do Government Regulations Really Kill Jobs? opinion November 14,2011 Washington Post by  Jia Lynn Lang, explores the concept that one industry’s losses on overbearing regulations are another industry’s  boon.  Leaving aside the Broken Window Fallacy introduced by Bastiat that’s been around over 160 years for the moment, let’s look into the brilliant mind of Roger Noll, an economics professor at Stanford and co-director of the university’s program on regulatory policy. “Some people identify with the beneficiaries, others identify with those who bear the cost, and no amount of argument is ever going to change their minds.”  This is a leading economist paid by a major university to come up with this explanation to downplay the absolute economic wreck the US regulation and tax policies have had on our country.  You cannot make this stuff up.  By “some people” identifying with the beneficiaries, is the esteemed professor suggesting parasites are interchangeable with producers?  Some will identify with thieves, others with the victims, according to the Stanford professor.  Since the author of this article has only plumbed the depths of a few “economists, ”  I’d like to introduce her to some basic facts in from a relatively short snapshot in History.

From 1998-2000, the US saw 4470 IPOs or Initial Public Offerings.  From 2001-2010, that number fell almost 4/5th in ONE DECADE.  What the heck happened??  A little beauty  of a regulatory law, just under 60 pages, sponsored by legislators Sarbanes and Oxley in 2002.  What about that horrible tech bubble that caused the stock market to tumble in 2000?  That “bubble” was the strongest contributor to the U.S.’s position as the undisputed economic and technological leader of the world.  It resulted in disruptive technologies that changed the world and every one of our lives and is still doing so today.  Then we passed SOX.  This was supposed to stop bubbles from occurring.  Fast forward to 2008.  Well, there weren’t many IPOs for your money to invest in-which left real estate all by its lonesome.  Hmmm, that SOX sure did work on real estate.

Today, we are getting ready to face the regulatory tsunami of Dodd-Frank.  This nifty law is over 2300 pages.  What sane US company wants to stay on this island?

Well, it’s possible Sarbanes, Oxley, Dodd and Frank might cook up a new law to force them to stay here.  Slavery, 2012 style.

 

 
Lazy American Business – Cartoon

Here is a great cartoon by Dennis Evers

 

 

 
Complainer in Chief: US Business Lazy

According to a Fox News story, President Obama: U.S. Gotten a Bit “Lazy” on Attracting Businesses, “President Obama said that the United States has gotten a “little bit lazy” when it comes to bringing in new businesses in to the states”.  He said some of the advantages of the US are its stability, and its innovative free market culture.

I guess I am just a little confused how a 2300 page health care law provides stability or how the government taking over 1/7th of the economy is free market?  How is a patent law (AIA) written by large companies to entrench their position furthering our innovation?  How does Dodd Frank also over 2300 pages further the free market?  Or contribute to stability?  How does interfering with Boeing’s decision to move to South Carolina result in stability?  How is that a free market?

Of course Obama is such a narcissist that he would never look at his own idiotic policies and how they are causing the slowdown in American business.  It is doubtful that Obama really wants the US to be successful.  So, his speech was really an exercise in DOUBLESPEAK.  1984 predicted the future it just took twenty five years longer than Orwell thought.

 

 
Trade Deficits, The Economy, and Intellectual Property

Donald Trump is fond of saying that China is stealing our economy from us and he attributes this to China manipulating its currency.  Here is an article, Counterfeit Chinese Parts in US Military Weapons, that would appear to support his point of view.  The article explains that counterfeit Chinese parts are found in U.S. military weapon systems and the implication is that this is happening even more widely in the US economy.  Pat Choate’s excellent book Hot Property: The Stealing of Ideas in an Age of Globalization, documented this problem.  Counterfeit products are not the result of currency manipulation but lax enforcement of intellectual property rights.  Our politicians talk a lot about protecting our intellectual property, but ten years ago they required U.S. inventions be published for all the world to see and steal at 18 months from filing a patent application.  They passed the America Invents Act this year which made it easier to challenge patents issued in the U.S. and effectively eliminated the one year grace period.  Congress is a bunch of hypocrites when it comes to intellectual property, they only want to protect Hollywood and software copyrights. They have done everything in their power to undermine our inventors, who are much more important to our economy than Hollywood.

The U.S does have a legitimate complaint with China, but it is not currency manipulation it is the theft of our Intellectual Property – particularly our inventions.  Here is what Congress should do to revive our economy and protect our inventors.

1) Repeal the publication requirement for patents

2) Demand that China and other countries require reciprocity for patents. This means that if you receive a patent in the U.S. it is enforceable in China and vice versa without the cost of filing a patent application in every country around the world.  The present situation with respect to patents is exactly the position that existed with respect to copyrights in the 1860s.  We realized that it made no sense for copyrights and it makes no sense for patents to only apply in each country.

3) Fully fund the Patent Office.  It now takes from 3 to 10 years to obtain a patent.  This is severely hurting our technology startup companies.  When combined with the publication requirement it has allowed China and the rest of the world to steal our technology.

4) Apply tariffs to those sectors of Chinese goods that have consistently violated U.S. intellectual property rights.

 

 
Mayo v. Prometheus: An Update

The Supreme Court will hear arguments in this case on December 8, 2011.  This case is about whether Prometheus’ patents (6,355,623 & 6,680,302) claim patent eligible material under 35 USC 101.  Section101 is a bit obscure, but logically anything that is not found in nature (separate from man) and that solves an objective problem is an invention.  Ultimately, section 101 is a threshold question of whether the subject of the patent is an invention. The novelty requirement, section 102, is not asking whether the subject of the patent is an invention, but whether the applicant is the inventor.  The nonobviousness requirement, section 103, is really the outgrowth of judicial activism (see Non-Obviousness: A Case Study in Judicial Activism).  The only logical basis for the nonobviousness requirement is that you have to be more than just the inventor to deserve a patent.  This is a violation of the Constitution, Article 1, Section 8, Clause 8, but I digress.  Section 112 of the statute is about whether the applicant fulfilled their part of the social contract.  The only question before the Court is whether the patents are directed to an invention.

The patents claim methods for determining the optimal dosage of thiopurine drugs used to treat gastrointestinal and non-gastrointestinal autoimmune diseases.  Thus, the questions in this case are whether determining optimal dosages of thiopurine drugs to treat autoimmune diseases exists in nature separate from man and whether this solves an objective problem?  Clearly, determining optimal dosages does not exist in nature for any drug and the patent solves the objective problem of determining the optimal dosages of thiopurine drugs for autoimmune diseases.  CASE DISMISSEDThis case is straight forward and should never have been granted certiorari by the Supreme Court. I have previously written about this case at Mayo v. Prometheus – Supreme Court Grants Cert (Again).

I consider it bad news that the Supreme Court granted certiorari in this case, because they have gotten so many patent cases wrong in the last five years.  Their understanding of patent issues would make a first year patent associate blush.  However, the last patent case they decided, Stanford University v. Roche Molecular Systems, showed some signs for hope.

Mayo has attempted to obscure the issues, by blurring the differences between section 101 & sections 102 & 103.  For instance “Mayo argues that the claims’ physical steps should be disregarded because they are old in the art.” (p. 1 Prometheus Brief)  Whether these steps are new or old is totally irrelevant to the 101 question.  This question is only relevant to the question of novelty and non-obviousness.  But even with respect to the question of novelty and non-obviousness this statement is non-sense.  It is a violation of both logic and legal precedent.  Every invention ever created is a combination of known elements (steps) because of conservation of matter and energy – you cannot create something from nothing.  From a legal precedent point of view, this is an attempt to reinstitute the point of novelty test, which was always nonsense because it violates conservation of matter and energy.

Mayo also attempts to argue that Prometheus has patented a law of nature.  This is absurd – the optimal dosage for an individual human being of thiopurine drugs, is a law of nature?  Admittedly, I am not an expert in pharmacology but there is no way that determining an individual dosage for a specific person is a law of nature.  Mayo knows this is non-sense, so they attempt to make the argument respectable by again disregarding parts of the claims.  A law of nature would be something like the absorption rate of a drug into a cell is based on certain factors.  An application of that law of nature, for instance to tailor a drug so it has a faster or slow absorption rate is an invention.

Mayo then puts forth the fraudulent argument that every patent should be evaluated by the courts as to whether it “promotes science and the useful arts.”  First, of all the preamble to Article 1, Section 8, Clause 8 is not limiting and never was meant to be limiting.  It is standard knowledge to every patent attorney that preambles are not meant to be limiting.  The Constitutional clause uses the word “RIGHT” and by right the Founding Fathers meant “natural rights”, which are not subject to some utilitarian purpose. The right to Life, Liberty, and the Pursuit of happiness are not subject to some utilitarian goal, they are unalienable – inherent in being a human being.  The fraudulent nature of this argument can be seen in the fact that its proponents never suggest that every trashy novel, movie, or painting should not receive copyright protection because it does not advance science and the useful arts.

Mayo then puts forth another argument made by every parasite – namely that patents are a monopoly.  This is just nonsense.  Patents are a property right not a monopoly. The statute defines patents as a personal property right and patents meet all the tests of a property right.  Namely, 1) Does the right arise because the person created something?  Creation is the basis of all property rights.  The law is just recognizing the reality that the person is the creator and without that person the creation would not exist.  This is consistent with Locke’s Natural Rights and Ayn Rand’s Objectivism. 2) If someone else was the creator would they have received the right in the creation? This ensures that the right does not arise from political favoritism. 3) Is the right freely alienable?  Freely alienable means that right can be sold, transferred, divided, leased, etc.  This is a key feature of property rights. Patents fit all three criteria and are property rights.

Mayo then puts forth the PATENTABLY absurd argument that the patent system could be replaced by government funding of inventions.  The absurdity of this argument can be summed up in one word – SOLYNDRA. First of all, the Supreme Court does not have the authority to make the decision to scrap the patent system and replace it with government funding.  This argument by Mayo borders on delusional.  Even Congress does not have the right under the Constitution to eliminate patents that would require a Constitutional Amendment.

Mayo has neither the facts or the law on its side so its approach is to purposely confuse the issues and to outright lie.  Mayo should be ashamed to have its name associated with the parasitic attempt to rob the invention of others.

 

 
Sarbanes Oxley: Relief May Be on the Way

I wrote about the damaging effects of Sarbanes Oxley in my book, The Decline and Fall of the American Entrepreneur.  It appears that the Republican presidential candidates have read my book.  See this video, J. W. Verret Discusses Sarbanes-Oxley on Fox News, which shows the candidates explaining that we need to repeal SOX.  Let’s hope that they don’t just tinker around the edges with SOX and while they are at it they need to repeal Dodd Frank.  This would be a big step toward restoring innovation and getting the economy growing again.

 

 

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