State of Innovation

Patents and Innovation Economics

Innovation Act Will Greatly Harm Independent Inventors: Guest Post Randy Landreneau

Patent legislation is in the works right now that is a greater threat to independent inventors than any legislation we have seen in the past.

The bill is the Innovation Act, HR 3309, which passed in the House on Thursday, December 5th. I don’t know everything that is wrong with it, but there are two particular things that really stand out. One is Loser Pays. According to this bill, if a patent owner sues someone for infringement and doesn’t win, he automatically has to pay the other party’s legal expenses. This will end the ability of the typical independent inventor to defend his property. Historically, an inventor could hire an attorney on contingency. Loser Pays creates a huge financial risk that totally changes the playing field. Under Loser Pays, An independent inventor would have to risk financial ruin to defend a patent.

The Innovation Act also undoes provisions that were intended to prevent serial challenges to patents. Under the present law, someone challenging a patent must put their best case forward rather than withholding information and bringing multiple cases in an effort to bankrupt the patent owner. This bill enables vested interests to use serial challenges to bankrupt patent holders and eliminate competition.

The stated reason for this legislation is patent trolls – companies that don’t produce products (NPEs – non-practicing entities), and that buy patents and allegedly sue companies frivolously for infringement. This situation has been hyped up way beyond any actual harm simply to enact legislation that will 1) make it harder for large corporations to be sued successfully for infringement, and 2) eliminate the independent inventor as a threat to the vested interest.

Is there a better example of America and the American Dream than an independent inventor, burning the midnight oil, working toward success with a new invention? This is what the American Patent System was designed to spur, and it did so. It is no accident that America became the most innovative and most prosperous country in the world. But multinational corporations have been using politics to weaken our patent system. The America Invents Act hurt us, but the Innovation Act is the nail in the coffin.

This bill will be voted on in the Senate. It could happen at any time. It got pushed through in the House very fast. Please forward this information to anyone who can help defeat it. Senators need to hear how the Innovation Act will harm independent invention. 99% of the political effort is from large corporations whose interests are directly opposed to independent invention. Please contact your Senators and forward this information to anyone who can help. Time is of the essence.

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December 10, 2013 - Posted by | -Law, -Philosophy, Patents | , ,

7 Comments »

  1. Moreover, it “de-secures” inventor property rights in contrast to what is empowered by Art. 1, section 8, clause 8 of the Constitution

    And it treats “inventors” as an insular, discriminated against class of property owners in violation of the equal protection clause

    Comment by step back | December 11, 2013 | Reply

  2. Good point. Only inventors are subject to loser pays, not ambulance chasers, not shareholder derivative blasters, not medical malpractice spammers, just those evil inventors

    Comment by dbhalling | December 12, 2013 | Reply

  3. … and no one feels “grateful” to the inventor.

    1) You invented the wheel? Why thank you not so much. I’ve got an important life of my own to live and not a precious moment to spend thinking of you. Please step aside while I drive off in my self-made man automobile.

    2) You invented a vaccine for a pandemic disease? Why thank you not so much. I’ve got an important life of my own to live and not a precious moment to spend thinking of you. Please step back, you’re blocking my path, the via oblong which I traverse ….

    3) You invented what? Ha. It was obvious all along the via on which I traverse ….

    (Which is why we have patents … or “had” them if current events point to our future of evermore decline.)

    Comment by step back | December 14, 2013 | Reply

  4. Yes and the guy who invented fire was burned at the stake for giving people fire.

    Comment by dbhalling | December 14, 2013 | Reply

  5. Dale,

    Right up your alley: John White is suggesting on iP Watchdog today that patents are “monopolies”.

    Comment by step back | December 15, 2013 | Reply

  6. Dale,
    I see you got my message & posted re “monopolies”
    I tried to post too
    For some reason I’m being blocked off of IP Watchdog
    Maybe it’s the yahoo email address (or maybe it’s just me)

    Comment by step back | December 15, 2013 | Reply


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