October 24, 2011
If we could improve the quality of U.S. patents, inventors of truly novel, useful inventions, would get patents that would be clearer (give better notice) of the invention, be easier to interpret and apply, and rarely be held invalid or unenforceable. This would give more protection to patentees. Most likely stronger patents would result in fewer lawsuits, or at least reduce litigation and enforcement costs by limiting issues in dispute. If this change were effected by a means that increased examiner time available for all applications, reduced the number of applications without cutting U.S.P.T.O. staff or budget, then the overall the cost of applying for patents, payment of maintenance fees, and attorneys’ fees incurred in the patenting process would go down, and patents would issue more quickly than they do now.
Patent reform in 2011 saw changes to the patenting system, but not changes that will dramatically reduce the number of patents or improve quality: First to file will encourage more applications to be filed fast, with less thought and care, to claim early filing dates. Tweaks to prior art defenses and protection for pre-existing acts will encourage people to file more applications as a means to stake out their positions — not just as “first to file”, but to the publication of prior art, as well as prior use defenses. There are already anecdotal stories of large numbers of provisional applications being filed in the last month.
Yet the “Elephant in the Room” of improving quality of patents before they issue is not addressed in a complete or meaningful way by patent reform. There is no limit on continuation patents. Since “best mode” is no longer a defense to validity, it will no longer be a priority for patent drafters. Moreover, emphasis on post-grant review rather than pre-issue improvement of patents is institutionalized in the new law (in other words, we will really examine the patents people show an interest in after those patents issue…). The 200,000 new jobs promised by President Obama when he signed the Leahy-Smith America Invents Act of 2011 will likely be in the legal field.
Yet Tim Wilson of the SAS Institute in North Carolina, the largest privately held software company, has been talking about an idea largely left alone by patent reform: Improving the quality of patents before they issue. “Preventive care” and “advanced screening” have become so well accepted as the best way to reduce illness, that even health insurance companies pay for it. Mr. Wilson wrote about a similar idea to improving the quality of issued patents in a 2008 article he published in the International In-house Counsel Journal Vol. 2, No. 5, Autumn 2008, 806–815 ISSN 1754-0607 print/ISSN 1754-0607 online Patent Demand – A Simple Path to Patent Reform, TIMOTHY K. WILSON Senior IP Counsel, SAS Institute Inc., USA. This paper can be found on line at the fountainhead of patent commentary, Dennis Crouch’s Patently-O blog: http://www.patentlyo.com/patent/law/wilsonpatentfees.pdf.
Mr. Wilson suggests large fee increases for large entities: If a large business thinks a patent is worth applying for, the application is worth spending a meaningful amount of money to do so. Moreover, if each application’s filing fees were up to ten times today’s fees, executives will not only be more judicious in administering their budgets, but likely get involved in the patenting process — connecting the patent to the business’ market and product objectives not just adding to its statistics. Encouraging better quality through higher filing fees would slow the race for the honor of who could apply for the most patents each year. Moreover, the reduced load on examiners will improve all patent examination, not just those subject to a jump in large entity filing fees: this addresses the “NPE” problem at its root, quality will prevail over quantity. Further, even though fewer applications might be filed, the increased fees will make up for the difference in revenue, permitting the U.S.P.T.O. to maintain its present resources while reducing its work load.
I hope everyone reads this article before the next round of patent reform, so that we can lead the Elephant out of the room….