Tuesday, May 30, 2006

Owning the Idea of Tree Frog Venom

Solveig Singleton accidentally makes a very strong argument against patent rights in an article critical of actions taken by the Brazilian government to protect the knowledge of indigenous tribes and their discoveries of the many uses of tree frog poisons:
But a claim that indigenous people's or their representative governments "own" the venom of a tree frog, medicinal or otherwise, simply by virtue of having discovered it...? Well, it sounds like patenting a law of nature to me.
To which we say, "exactly." All inventions are discoveries. Does the act of discovering a new fact, idea, or combination of components cause the discoverer to own that fact, idea, or combination, and give them the right to exclude all others from practicing any similar idea? Does it give the holder of patents covering these ideas the right to a complete monopoly over entire industrial sub-sectors? According to our patent system, yes and yes.

Solveig continues:
Would these same discoverers share the risk and blame if the product were somewhere downstream, found to cause birth defects or other harm?
Would the "discoverers" of wireless email (NTP) share the risk and blame if the BlackBerry network went down, or if BlackBerrys were found to cause birth defects or other harm? The answer, of course, is no. Patent trolls are completely decoupled from any responsibility whatsoever, other than the duty they have to spend money on lawyers and extort outrageous fees from 'infringers' through abuse of our legal system. I'm not sure why Solveig brings this point up, unless she's of the same opinion that we are -- namely, that any system which assigns exclusive ownership of discoveries and ideas to only one party (such as our patent system) is inherently absurd. She continues in this vein:
Would they also desire to share in the profits from sales of coffee, tea, and chocolate, claiming to have discovered their property of tastiness? What about the properties of coca leaves and opium poppies? Would they like to share in the profits from the development of those products into painkillers? Would they also like to share in the profits from the sales of heroin and cocaine? What about crack?
Of course, maybe Ms. Singleton hasn't heard of Peruvian patents on potatoes or Indian patents on basmati rice? Or perhaps she hasn't examined the tags of just about any plant, shrub, or tree purchased at a nursery in this country lately, which warn the purchaser that breeding or germinating the plant is in strict violation of the "intellectual property rights" of the grower? Surely Ms. Singleton must be aware of the many 'rights' that companies such as Monsanto exercise, such as the right to sue farmers when Monsanto's seeds blow into their fields.

But the point is this: if patents give exclusive property rights to discoverers of new medicines and technologies, what argument could there possibly be against giving those same rights to the discoverers of tree frog venom? In both cases, some labor and inventiveness was spent to make the discovery. In both cases, something new and innovative resulted.

Perhaps the distinction is that the tribes in the Brazilian Rain Forest didn't know about the patent system when they made their discovery, and therefore didn't anticipate receiving such rights? But then, whoops! -- that would be an admission that discoveries and invention can occur without a patent system in place.

Or maybe the tribes don't deserve this economic benefit because they are primitive, and only 1st world discoverers (i.e., ones that are literate and that wear lab coats instead of loin clothes) deserve patent protection? But then, whoops! -- we shouldn't be foisting strong patent protection systems upon the third world and claiming that this will benefit those countries when the truth is that it mostly benefits us and our large, corporate patent-holding interests.

Ms. Singleton concludes:
Leave it to some of the loudest critics of patents to come up with the broadest theory of ownership yet, most resembling a feudal entitlement.
Wrong, Ms. Singleton. It was proponents of "strong" patent "rights" who have created a system in which such absurdities abound. And it doesn't appear, from the NYTimes article, that the 'loudest critics of patents' are the ones coming up with this tree frog poison protectionist scheme. On the contrary, it was Tribal Chief Fernando Katukina, who appears to be using the simple self-interest of his tribe as his motivator. He should at least be commended for his cleverness in exposing patent systems for what they really are: an artificial scheme to take wealth from one party and give it arbitrarily to another.

All this complaining by IP-maximalists when foreign nations figure out how to use our patent regime against itself only illustrates the true motives of creating these corrupt systems in the first place: to fortify exactly those feudal and aristocratic societies which Ms. Singleton claims to oppose, where status and wealth is determined only be which patent-owning 'family' you belong to.

Friday, May 26, 2006

JPEG Patent Rejected

The USPTO has rejected the broadest claims of the JPEG image format patent held by Forgent Networks.

It's nice to see the Patent Office doing the right thing, but it's too bad that more than $100 million dollars that Forgent has extorted from industry will never be returned to its rightful owners. Forgent gets to keep that money, regardless of how the PTO rules. For nearly 19 years, this patent has stood without challenge. Now, just over a year before it was to expire, the PTO declares that it is bogus.

So, how would you feel if you had paid hundreds of thousands of dollars to Forgent because they threatened you with a lawsuit that, regardless of outcome, would have cost you millions (average cost of defending oneself in a patent infringement suit stands today at roughly $10 million)? How would you feel knowing that our patent system stood idlely by, while Forgent played this extortion game against hundreds of companies?

And most importantly, how do you feel knowing that this is exactly the kind of behavior that our current patent system encourages, today?


Monday, May 22, 2006

Funny Dystopia

A wonderfully creative thread on the dark future of intellectual monopoly is highlighted here.

Sunday, May 21, 2006

More Money for Patent System Hijacking

The government wants to spend money educating judges to be better informed on patent issues, including hiring "specially appointed clerks with patent expertise." At face value, this sounds like a good idea, but TechDirt explains exactly why it probably is not: specialization leads to a type of bias which will likely make the system worse, one in which former patent attorneys become specially appointed clerks and judges. One in which the money spent on this type of special education starts to come mainly from the same interests who have been pushing patent "rights" towards IP-maximalism for the past several decades. The parallels to regulatory capture are too numerous to mention.

New Right to Create Domains

AJ Rahim has generously forwarded three domains to point at Right to Create, so you may now access the site from www.unfairpatents.com, www.unfairpatents.info, or www.stopunfairpatents.info. Thanks AJ!

Thursday, May 18, 2006

Patent Holdouts

Over at TechLiberation, Tim Lee points to a paper by Chicago law professor Doug Lichtman on Patent Holdouts, and makes this commentary:
What I found most interesting about the paper, though, is how frankly Lichtman—who I don’t think is a critic of patents generally or software patents in particular—lays out the flaws in the current patent system, especially as it relates to high-tech inventions with hundreds of components. He explains how difficult it is for honest technology creators to discover patents that might be relevant to the technology in development, how the system gives inventors the perverse incentive not to search for relevant patents to avoid treble damages, and how the holder of an undiscovered patent can lie in wait until other companies make significant investments based on their patents and then exort large sums of money from the hapless inventor.

Tuesday, May 16, 2006

Injunctions, Monopolies, and the Free Market

Yesterday's ruling gives courts full discretion over whether an injunction should be issued when a valid patent is infringed. Why is this so monumental? It boils down to economics.

Prior to this ruling, a non-practicing patent holder (sometimes referred to as a 'patent troll', but also including small inventors without the resources to commercialize their inventions) was simply using the injunction to get monetary compensation from the infringer. An infringer was forced to the "negotiating" table with the patent holder by power of the injunction. The patent holder's task was then to find the highest price that the infringer could bear, and extract that price from the infringer.

Some have argued that this was a fair and efficient process -- the courts didn't have to decide dollar amounts, but left it to the two parties to work out on their own.

But this hides an important economic principle in free markets: that markets, not monopolies should determine prices, and that competition is always good for the market.

In the case of patents, a monopoly has been granted to the holder by the government. Allowing the holder of those patents to then seek rent with that monopoly power, without any oversight, gives holders of patents absolute price control. It gives the holder the power to maximize profits. It gives the holder of the patent power that no owner of physical property posesses, powers that no manufacturer of physical products can ever posess. It elevates patents to a status above actual property.

By allowing courts to use discretion in determining when not to issue an injunction against a patent infringer, the Supreme Court has opened up the possibility for much fairer damages to be awarded to patent holders whose only goal is to be fairly compensated for their inventions. By issuing this rulling, they are telling lower courts that they must not abdicate their responsibility to ensure that damages are fair; when a non-practicing patent holder has won their case against an infringer, the two parties must now argue in front of a judge over what they think an appropriate compensation dollar amount should be, and an impartial third-party (the judge or jury) must make a decision on damages taking those arguments into account.

No more does the non-practicing patent holder get to strong-arm its prey into submission. Fairness is at the heart of every just legal system. The Supreme Court, in issuing this ruling, has understood how unfair monopoly power can be when used solely as a tool of extortion. And it has recognized that patent holding firms have been abusing the courts in this way for years, and that the legal system must change so as not to encourage such corruption in the future.

Monday, May 15, 2006

Supreme Court Demolishes Automatic Patent Injunctions

Big news today: the Supreme Court, in a unanimous decision, has removed the “general rule” that a permanent injunction should be issued once infringement of a valid patent is established. It reversed a lower court's decision that allowed MercExchange to receive an injunction against eBay.

What this means: patent trolls will find it increasingly difficult to swing the axe of injunction over the heads of researchers, academics, innovative startups, and industry titans. Trial courts have complete discretion over whether an injunction is an appropriate remedy for a patent holder. Had this decision arrived earlier, companies like RIM may have never had to pay out more than $600 million to patent extortionists or suffer years of irreprable market-place harm and multi-million dollar losses of stock market valuation as the spector of such injunctions hung over their businesses.

What this doesn't change: this likely won't affect legitimate competitors with valid patents from achieving injunctions. Only patent holding firms (aka, trolls) will have difficulty in proving that irreperable harm is done by allowing the 'infringer' to continue practicing claims of the patent, and that a monetary remedy is insufficient.

This is a big deal, as it increases your right to create. It diminishes the paper inventor's monopoly over basic ideas, and gives you more freedom to invent and market your innovations without the fear that unscrupulous individuals will be able to thwart it all by gaming the legal system.

This subtle change doesn't destroy the shackles of our broken patent system, but it certainly loosens the bonds that tie innovation down. And perhaps most importantly, it demonstrates that the Supreme Court understands how oppressive the current legal system has become with respect to patent litigation. This decision is, perhaps, a portent of how the Court might feel about several other important patent issues it is schedulued to hear.

Dennis Crouch has more in-depth analysis.

Additional Commentary: Injunctions, Monopolies, and Free Markets

Thursday, May 11, 2006

Digital Video Patent Thicket

We've talked about the emerging threat of patents covering MPEG-4 recently, but today there is a fascinating discussion regarding MPEG-2 Patent Thickets and their impact on software DVD players, consumer choice, and vendor freedom over at The Technology Liberation Front, with the article coming to the logical conclusion that:
In any event, the best solution is to repeal software patents, which impede innovation in this and many other software categories.
This post was a followup to another fascinating discussion at TLF regarding Linux DVD players.

OnStartups Advice on Patents

OnStartups, a blog providing "Practical Advice for Software Startups", recently published an article detailing the value of barriers to entry, and explaining why there really are only three types of these for a software startups. I'll leave you to read the article if you care to know what these are, but conspicuously missing from the list were patents:
If you’re thinking: “What about patents?”, my response is “what about them?” Patents are a strange kind of barrier to entry that actually requires that people acknowledge their existence and you have the resources to enforce them. For most startups, neither of these are true. How many software startup founders have you met that do an exhaustive patent check before locking themselves in a room and writing code? Not many.
This seems to fall squarely into lines with what most people have said for a long time: patents are really only valuable in the hands of companies with relatively deep pockets. Individual inventors, scientific researchers, and founders of startups are disadvantaged by their presence.

Wednesday, May 10, 2006

Seeking an inventive patent system

The Philadelphia Enquirer provides a succinct summary of our current patent woes in today's opinion piece:
When fueled with adequate resources, these [patent] systems encourage the creation of inventions and drive economic growth.

At one time, the U.S. patent system was an example of this creative dynamic. Not anymore, as patent-related issues have become uncertain, [and] lengthy, legal proceedings rather than business or scientific discussions [determine the outcomes].
The commentary recommends several useful reforms, including a suggestion to
adopt a "probation" system, in which patents are granted but then subject to a rigorous review by interested third parties. Only an invention that passes the scrutiny of experts and competitors would be assigned a permanent patent, making it more robust.
This is similar in nature to premature expiration combined with incentives for encouraging applicants to find their own prior art, but is stated more concisely under the term "Patent Probation."

Constitutional Patent Crisis

LawPundit's Andis Kaulins details the steady expansion of the government-granted 'rights' given to the intellectual monopoly regime from its narrowly imagined constitutional basis, enshrined by our founders over 200 years ago. His well-written opinion is backed up with many examples and is steeped in historical fact. Of course, that doesn't stop Patent Prospector's Gary Odom from refuting his arguments by claiming that the author enjoys "his rich fantasy life," but apparently not in "solitude," because Kaulins uses the word "we" to refer to himself. Unfortunately, that type of ad hominem attack and diversionary quibbles about speaking in the third person says a lot about the current level of debate that the IP-maximalist crowd engages in these days.

Updated to correct misquote.

Tuesday, May 09, 2006

Patent Doomsday

John Soat describes a chilling patent doomsday scenario over at InformationWeek, and invites you to do the same.

Let us know what you come up with and we'll point to your blog entry or webpage. Or feel free to compose your scenario and attach as a comment to this post.

Ridiculous Patent: Paying Programmers

A company called OpenLogic has come up with an innovative way to provide expert-level technical support for open source products, while also funding developers of those projects: pay participating developers for support activities. Unfortunately, IBM patented a very similar idea in 2003.

(Note of interest: IBM has agreed to be the guinea pig for the peer-review patent pilot program. No word on whether or not they are hoping to have more of their embarassing patent applications rejected. Either way, they get points for trying to help improve the process.)

Patent Peer Review

The USPTO is kicking off their exploration of peer-reviewed patent applications with a pilot project. Peer reveiw has tremendous potential for increasing patent quality, but any process also has equally tremendous potential for abuse. Hopefully, they'll figure out how to make this work in a sensible way, and then can begin tackling other reform measures.

Thursday, May 04, 2006

Free Software and Model Railroading Patents Update

Pamela Jones of Groklaw has written a detailed summary of the continuing patent dispute between KAM Industries and Bob Jacobsen's open source JMRI software for controlling model railroads.

If you aren't familiar with the case, Bob Jacobsen is a model railroading hobbyist who wrote the JMRI software in his spare time and then gave it away for free. KAM Industries then sent him an invoice for over $200,000, claiming that he infringed their patents and that he owed them royalties.

Tuesday, May 02, 2006

The Invention of Television

Pem Farnsworth's recent passing at her home in Utah provides a good opportunity to discuss one of the most important (or at least influential) inventions of our age: the Television. Pem was the wife of its inventor, Philo. Philo Farnsworth, incidentally, always claimed Pem was television's co-inventor.

If you are unfamiliar with Philo Farnsworth's story, you should acquaint yourself with it. It is a fascinating tale of a lone inventor coming up with a brilliant idea, pursuing it to its fruition, then watching, helplessly, as corporate America took full credit, leaving Farnsworth nearly destitute and unknown until after his death in 1971.

At the age of 15, Farnsworth had conceived his fundamental idea and sketched it out for his High School physics teacher. By the age of 20, he had applied for two patents covering the invention. At 22, he had a working camera and television set. It is Farnsworth's ideas that form the basis of all modern televisions.

Of course, many others were also pursuing television. In a society already very accustomed to both radio and movies, it was not a great leap to think of combining the two mediums by transmitting moving pictures along with sound. RCA, under the direction of David Sarnoff and technician Vladimir Zworykin, applied for their own patents and spread their own message about television. By the end of the 2nd World War, most Americans came to know RCA, Sarnoff, and Zworykin as the fathers of television. As Wired puts it, Sarnoff "and his lawyers did to Farnsworth what they'd done to those who had developed key radio inventions but had refused to cooperate with RCA: They launched a legal assault aimed at overturning the patents on appeal, tying up the inventor emotionally and financially for years. The challenges continued for much of the '30s. They slowed the development of television, delayed its introduction to the public, squandered Farnsworth's already thin resources, drove him to drink, and contributed to his development of a bleeding ulcer." Farnsworth battled RCA in court and was eventually vindicated by the USPTO as the sole inventor of television, but "time ran out. Farnsworth's key patents expired in 1947, just a few months before TV sales took off from 6,000 sets in use nationwide to tens of millions by the mid-1950s. RCA captured nearly 80 percent of the market, while Farnsworth was forced to sell the assets of his company."

The patent system couldn't help Farnsworth much then, and it wouldn't help him much now. A patent system will always end up benefitting moneyed interests more than it benefits individuals. Corporate control of the process has never been stronger, yet we see that the more things change, the more they stay the same. If it hadn't been for RCA's lawyering with bogus patents, Farnsworth may have been able to get his invention into consumers hands and reaped the benefits of his labor. Instead, he had to waste years pleading with the government in court against RCA's patent litigation. The patent system was ineffectual in protecting Farnsworth, even though he held valid patents.

Some would argue that the solution to problems like this is to make the patent system even stronger, and make it even easier for patent holders to assert their rights. Yet any such strengthening gives disproportionate muscle to the RCAs of the world, who have more money to throw behind their "patent rights" than any lone inventor ever will. The only way to level the playing field is to reduce the strength of patents, so that individuals like Farnsworth have a right to create equal to that of big corporations. As long as we continue to give patent holders big enough rocks, they will continue to use them to smash the windows of the innocent.

footnote: Farnsworth continued inventing during his later years, focusing on nuclear fusion. The Farnsworth-Hirsch Fusor was the first device to clearly demonstrate any fusion reactions at all, and is still in use today. But because of his prior experience with the patent system, Farnsworth refused to use patents to protect his discoveries, most of which became public domain. However, it is widely feared that some of these discoveries went to the grave with Farnsworth in 1971.

Monday, May 01, 2006

Why Patent Trolls Win

If you negotiate with terrorists, it'll encourage more terrorism. This appears to be just as true of terrorists who try to destroy your innovation and/or livelihood as it is of terrorists who hijack airplanes and blow people up. RIM has just found out that their $600+ million settlement with patent terrorist NTP is going to cost them even more -- now other patent trolls see them as an easy target. Visto Corp of California, has filed a patent infringement lawsuit against RIM in the Eastern District of Texas, hoping that NTP's recently successful shakedown of RIM with illegitimate patent claims will result in a similar outcome for them.

Regardless of the merit of Visto's claims (RIM counters that not only do the patents not apply to RIM technology, but that the patents are invalid anyway), this also clearly demonstrates the great harm that software patents cause -- how many patents could RIM's products and services possibly trespass upon, and when does RIM cross the break-even point into negative profits and be forced to shutter their wildly popular products, as dozens of trolls each demand a section of the pie greater than the pie itself?

All this, from a patent system which is constitutionally mandated to promote the useful arts and sciences. Tell me again, how do litigation cases like those started by NTP and Visto promote anything at all resembling that?

Update: as a note of interest, Visto is the company that licensed NTP's patents near the end of the BlackBerry trial. In exchange, NTP became a minority stake-holder in Visto. So in a very real way, Visto's lawsuit is just NTP's lawsuit all over again, with a different set of overly broad and obvious patent claims