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The Patent Act of 2015:
Securing Corporate Hegemony Over Patent Holders
Ensuring Free Appropriation of Patented Technologies for Profits
Presenting [your] Congress at work: [Ending the American Dream, a Failure in Democracy] The bills S.1137 and the Innovation Act H.R. 9 have been approved by the Senate and House Judiciary Committees and are headed to the House and Senate Floors.
"In 2013, Federal Circuit judges publicly warned that Congress was ill-suited to address litigation reform, and that any such attempts might encroach on the constitutionally enshrined power of the judiciary."
"In 2013, Federal Circuit judges publicly warned that Congress was ill-suited to address litigation reform, and that any such attempts might encroach on the constitutionally enshrined power of the judiciary."
“American inventors, let the march on Washington begin, or surrender your dreams and your patents, and the useless grants they will soon represent.”
- The Voice of Reason
"The Patent Act of 2015 S.1137 and the Innovation Act H.R. 9 as written are failures not only in legislation, but in democracy, by effectively, and practically, defeating the constitutionally chartered purpose of the patent system."
“In joining with corporations to protect markets and boardroom capital, and in seeking to strengthen the rights of defendants against the rights of plaintiffs, Congress is allowing itself to be used as an instrument of class warfare.”
“In joining with corporations to protect markets and boardroom capital, and in seeking to strengthen the rights of defendants against the rights of plaintiffs, Congress is allowing itself to be used as an instrument of class warfare.”
- The Voice of Truth
“It has come to the attention of Congress that the tools we have provided corporations to prevent inventors from interfering with the free appropriation of their patented technologies has not completely prevented patent owners from asserting their Constitutional rights against those corporations. We propose to eliminate this interference in five ways: 1) To ensure, through fee shifting, that any patent owner that attempts to assert his rights will face the loss of his home and family, 2) To set a pleading standard before discovery that in many fields will be able only to be met after discovery, thereby allowing corporations to completely conceal their appropriations, and forcing patent holders to risk bankruptcy through a wrong guess at infringement, 3) To cause such delays and obstacles during the litigation process as will ensure the advantage is given to well-capitalized corporations, 4) To remove all downstream accountability for trafficking in appropriated technologies by limiting inventors to pursuing infringement suits mostly against importing manufacturers in jurisdictions outside the United States, and 5) To delegitimatize all patent infringement suits by inventors and small business by ensuring they are met with such defenses as we can hastily legislate based upon...the sky falling. [Correction: WMD] [Correction: the Troll Threat]
- The [Fictional] Voice of Congress
While the quoted voice and bill title above may be fictional, the sentiments they express are far from untrue. In this bill, whose title advances from the onerous world of “1984” to the semi-delusional one of “Brave New World,” the bill's sponsors observe the American patent system from [the Martian colonies?] through telescopes with colored lenses provided to them by – well, you can figure it out. (Step forward and show yourselves, Silicon Valley giants)
Adorned with a title straight from a corporate public relations department, “The Patent Bill of 2015: “Protecting American Talent and Entrepreneurship Act of 2015” gives expanded meaning to the word “disingenuous.” Or are the sponsors relying on Plato's observation that democracy is only made possible through education, believing that most people will only ever read the headlines? The bill's sponsors would be hard pressed to find a single independent inventor, individual patent holder, or small business to endorse this bill.
Titles do not make reality, and this bill offers not protection but annihilation for small business and inventors, by ensuring that patents become for them mere grants unenforceable in any practical way, reducing their worth exactly to the value of the paper upon which they are printed. See "Why Patent Reform Harms Innovative Small Business", which notes this disturbing and telling fact: "...the Small Business Administrations's Office of Advocacy (OA) report required by the America Invents Act (AIA) to evaluate the the effects of that law on small business is more than 18 months overdue, and is likely more than a year away from completion." Imagine this were an environmental impact report - are the lives of millions of American inventors and their businesses less important than our deliberations on behalf of the spotted owl?
In fact, this bill is far from the educated practice of democracy. A few minutes of Web research shows the average cost of pursuing a patent infringement claim against a corporation can easily exceed five million dollars. The median net worth of the average American excluding home equity and motor vehicles is $34,000, and thereby, presumably, of the average American inventor. (Unlike the Median Net Worth of Members of Congress, over $1,008,767, or the average net worth of US Senators, over $14,000,000, who most likely wonder how anyone could presume to do business without a staff of attorneys on retainer, or possibly be short a few million dollars for litigation.)
Titles do not make reality, and this bill offers not protection but annihilation for small business and inventors, by ensuring that patents become for them mere grants unenforceable in any practical way, reducing their worth exactly to the value of the paper upon which they are printed. See "Why Patent Reform Harms Innovative Small Business", which notes this disturbing and telling fact: "...the Small Business Administrations's Office of Advocacy (OA) report required by the America Invents Act (AIA) to evaluate the the effects of that law on small business is more than 18 months overdue, and is likely more than a year away from completion." Imagine this were an environmental impact report - are the lives of millions of American inventors and their businesses less important than our deliberations on behalf of the spotted owl?
In fact, this bill is far from the educated practice of democracy. A few minutes of Web research shows the average cost of pursuing a patent infringement claim against a corporation can easily exceed five million dollars. The median net worth of the average American excluding home equity and motor vehicles is $34,000, and thereby, presumably, of the average American inventor. (Unlike the Median Net Worth of Members of Congress, over $1,008,767, or the average net worth of US Senators, over $14,000,000, who most likely wonder how anyone could presume to do business without a staff of attorneys on retainer, or possibly be short a few million dollars for litigation.)
For the experienced, it is well known that before even commencing discovery, the inventor may require one or two million dollars over the course of two years to fight Inter Partes Review and 101 validity challenges. This bill now proposes to shift the defendant's legal cost to the patent holder attempting to enforce his patent in the event he loses and his case is deemed frivolous. The real meaning of “frivolous” in the litigious world of big corporations is: you have failed to win. (And do not image you will not be punished for your insolence)
Regarding the onerous provision of fee shifting, Gene Quinn, founder of ipwatchdog.com, unequivocally states,
“Fee-shifting simply won’t matter to patent trolls. Ironically, fee-shifting will matter only to those who are pushing for it, and also for small entities. The tech giants who get sued for patent infringement by true innovators with strong patents lose with great frequency. After fighting a war of attrition as they like to do the attorneys fees they pay will be substantial.
Of course, it will also matter for those smaller entities who are the ones doing the innovating in America. For these companies capital is essential to survival, so the risk associated with losing and paying attorneys fees will be too much to bear. If that happens, why would these smaller innovative entities even bother using the patent system in the first place to obtain rights they know they will never enforce? That will drive innovation under ground, at least the innovation that continues. Without patents investors will simply ignore the overwhelming majority of innovative start-ups, which means they will die on the vine never having blossomed. That, of course, will be extraordinarily harmful to job creation because startups are disproportionately responsible for job creation, and high-tech startups are among those that pay the highest wages."
It is not patent holders attempting to enforce their patents that is hindering innovation but corporations and boardroom capital, protecting markets while not letting a single dollar slip through their hands to even worthy patent holders through licenses. In fact, if patent enforcement were made easier and more effective, capital would be forced to support innovation and the inventors, in all the stages of formation, growth, and licensing.
While the [presumably well-funded] complainants speak loudly about the annual loss of 60 billion dollars of firm wealth to patent litigation, denying any possibility of infringement, the profits corporations are amassing using infringing technologies could easily be ten times that, including lost revenue and markets by small innovative companies who could be growing, hiring, and creating more innovation. Instead, without consideration of what might be just or even judicious, this bill seeks to bury such dark secrets even deeper and ensure that the other side of the story, the plaintiff's side, the inventor's side, is never told.
In fact, the conduct of the Congress has been met with intense scrutiny by the Federal Circuit. According to Stuart P. Meyer, writing in the Fenwick and West Intellectual Property Bulletin, "In 2013, Federal Circuit judges publicly warned that Congress was ill-suited to address litigation reform,, and that [such reform] would be a land grab in Article III territory...and that any such attempts might encroach on the constitutionally enshrined power of the judiciary. The Judicial Conference of the United States ultimately sent letters to the ranking members of the House Judiciary Committee in late 2013 warning that the proposed Innovation Act introduced by Rep. Goodlatte “runs counter to” the process set forth in the Rules Enabling Act."
In fact, the conduct of the Congress has been met with intense scrutiny by the Federal Circuit. According to Stuart P. Meyer, writing in the Fenwick and West Intellectual Property Bulletin, "In 2013, Federal Circuit judges publicly warned that Congress was ill-suited to address litigation reform,, and that [such reform] would be a land grab in Article III territory...and that any such attempts might encroach on the constitutionally enshrined power of the judiciary. The Judicial Conference of the United States ultimately sent letters to the ranking members of the House Judiciary Committee in late 2013 warning that the proposed Innovation Act introduced by Rep. Goodlatte “runs counter to” the process set forth in the Rules Enabling Act."
In joining with corporations to protect markets and boardroom capital, and in seeking to strengthen the rights of defendants against the rights of plaintiffs, Congress is allowing itself to be used as an instrument of class warfare. Despite numerous, repeated, and well articulated warnings from a myriad of organizations describing the destructive consequences of passing this bill, Congress has moved forward in a straight line, albeit with with perhaps questionable authority, to accomplish their one-sided objectives, as though on a mission, which they are, but not to protect inventors, or innovation.
Brian Pomper, Executive Director of Innovation Alliance, a group that represents a broad range of research organizations on policy issues, states in an article published April 15, 2015:
“Many of the provisions of H.R. 9 would unnecessarily undermine the enforceability of all U.S. patent rights, even when clearly valid patents are being enforced in good faith against clearly infringing actors.”
...“significant” work remains on the bill before it can be widely supported.
“Concerns remain on the potential for abuse of the customer stay provision as currently drafted, the overbreadth of the pleadings and discovery provisions, and the need to adopt measures to address ongoing abuse in the inter partes review system,” he said.
The Innovation Alliance will continue to advocate for common sense improvements to these provisions to ensure that the PATENT Act targets the existing abuse by some patent plaintiffs without creating new avenues for abuse by patent defendants in the future.
We can strengthen our patent laws without undermining intellectual property rights and crippling a system that is so important to incentivizing innovation and job creation in our country.”
We can strengthen our patent laws without undermining intellectual property rights and crippling a system that is so important to incentivizing innovation and job creation in our country.”
Ironically, by continuing to undermine and weaken any realistic means of redress for patent holders whose patents and technologies are being infringed, Congress is in fact consolidating the power of NPE's and patent enforcing entities by ensuring those patent holders arrive at their doors as a last recourse. The result will be more litigation, not less, as corporations' present comfortable disregard for the patents of independent inventors advances to self-righteous contempt, and the end of innovation, because no inventor's dream is to sell their vision to an NPE.
The Patent Act of 2015 S.1137 and the Innovation Act H.R. 9 as written are failures not only in legislation, but in democracy, by effectively, and practically, defeating the constitutionally chartered purpose of the patent system. That purpose, and it apparently need be stated again, according to U.S. Constitution. Article One, section 8, clause 8 states:
"The Congress shall have power...To promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries. "
Nowhere does it state the intention or the authority, "...and to interpret this power so as to protect the markets and profits of corporations."
Please read Brian Pomper's important and illuminating article entitled:
The Patent Act of 2015 S.1137 and the Innovation Act H.R. 9 as written are failures not only in legislation, but in democracy, by effectively, and practically, defeating the constitutionally chartered purpose of the patent system. That purpose, and it apparently need be stated again, according to U.S. Constitution. Article One, section 8, clause 8 states:
"The Congress shall have power...To promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries. "
Nowhere does it state the intention or the authority, "...and to interpret this power so as to protect the markets and profits of corporations."
Please read Brian Pomper's important and illuminating article entitled:
Rather than fortifying the abuse of the system by Defendants, a just Congress should be more concerned about enabling the constitutional rights of inventors to be enforced than protecting corporations and their markets from the inconvenience of addressing patent infringement, an inconvenience dwarfed by the real and financial suffering of inventors and small business at the hands of corporate infringers.
Senators and Congressmen, where do you stand? Stand for corporations, markets and capital, or stand for American inventors and their constitutional rights. Now, in this fight, you cannot stand for both.
American inventors, let the march on Washington begin, or surrender your dreams and your patents, and the useless grants they will soon represent.
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