A Midsummer Night's Dream or Nightmare?...The Current Patent System

Countless words have been written regarding the state of the patent system, both in the U.S. and internationally.  Typically, even the most positive proponents or critical opponents of the patent system acknowledge some cons and pros, respectively.  As we experience the sultry summer days, this blog seeks reader participation to weigh in on whether the patent system is a midsummer night's dream, nightmare or somewhere in between.

One issue that has been raised by opponents of the patent system is that certain technologies should not be eligible for patenting at all.  For example, some say that computer software should not be eligible for patent protection.  Others believe that computer hardware should be eligible for patent protection but perhaps for a shorter term than the current 20 years of patent protection, e.g. 5 or 10 years.

Regular reader to this blog have on no less than two prior occassions (now three) been exposed to the reason we, in the U.S. have a patent system.  The Framers of the United States Constitution knew of the importance of technological progress.

The Congress shall have the 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. (U.S. Constitution, Article I, § 8, clause 8).

This provides inventors with an incentive to create new products and processes.  It also gives companies and investors (e.g. venture capitalists and stockholders), incentive to invest capital looking for a return on their capital investment.

Congress has limited the duration of the monopolistic protection.  In return for the protection, the inventor must disclose his or her invention to the Patent Office which, in turn, discloses the information to the general public.

The U.S. Patent Act was drafted to accomplishes two goals.  First, it encourages innovation and discovery through its incentive of limited monopoly.  Second, the patent system promotes the disclosure of useful technology to the general public by putting it in the public domain.

While patents can be misused and perhaps 20 years may be too long for certain technologies, e.g. some argue that software and possibly, hardware inventions, the core idea of any patent system, going back to our U.S. Constitution is to "provide an incentive" to people to create new and useful inventions, by (1) granting a limited monopoly in exchange for (2) disseminating the knowledge to the public. 

But is this working out as the Framers intended?

Things to consider are:

1. Would people (inventors and companies) continue to invest time and money to create "inventions" if someone could copy the ideas without having to invest his or her own time and money?
2. Is the public really getting a benefit from the information described in the patent, building on the information and know-how, and/or learning from it?
3. Would information currently being disseminated through the patent system still be disseminated to the public if the current patent system were curtailed or altered?

Proponents of the patent system, e.g. companies spending precious capital to secure patent protection, including biotechnology and semiconductor manufacturing companies, consider the limited monopoly essential to give their companies a competitive advantage and necessary to recoup research and development costs. Without the limited term monopoly, these proponents would argue that they would never be able to recoup the investment as competitors could swoop in and easily copy the technology that the company spent many dollars and years to discover and develop.

Opponents say that at least some technologies do not need a patent system as companies and inventors will still create the technology regardless of whether a patent system exists.  Some such opponents cite start-up companies which do not have sufficient capital to patent their ideas but still spend money on research and development.

Some opponents believe that the patent system actually stifles innovation and competition.  They argue that competitors would create competing products but do not in fear that they may be sued by a patent holder for patent infringement.  Some look to patents for technologies in mobile devices like the iPhone and Android devices when arguing that more companies would be creating hardware and software, spurring mobile communication innovation and driving down prices if not for the threat of possible patent infringement.

Still other opponents argue that the 20 year term is too long of a monopoly, especially in today's immediate access information age.  Further, opponents say that, with some technologies, after 20 years, the technology is so obsolete that no one even cares about it anymore.

A quick rebuttal to this last opponent argument is that the public still benefits from the knowledge disseminated in the disclosure of a patent, even if, arguendo, after the 20 years, the originally disclosed technology may be obsolete.   Likely, 20 year in the future technology is based on, build from, or has ties to past technology.  Over the 20 years the patent holder has exclusivity, others in the public have access to the information in the patent, can learn from it, improve it, and advance technology.  If the past technology was never created, future technology may not exist.

In view of the foregoing, I pose several questions for discussion.

Question #1: Do we need patent protection for certain technologies?
Question #2: Would people still invent if patent protection were not available?
Question #3: Will investors still invest in companies if patent protection, i.e. exclusivity, is not possible to prevent others from entering the marketplace?
Question #4: Should the patent term be less for certain technologies?
Question #5: If yes to question #4, which technologies and what should the length of the patent term be?

Please post your answers to these five questions, the three "Things to consider" items above, post your own questions, or post a comment or remark to this blog.  We look forward to a spirited discussion.

Coming up....ACT II

© Stephen J. Weyer 2013
Send email feedback- sweyer@stites.com


Are You the Master of Your Domain?

Brand owners are about to face new challenges in mastering their domain names and keeping others from using their trademarks online.  You may be most familiar with domain names that end with the extension .com, .org, or .net, referred to as generic top-level domains (gTLDs).  Recently, the Internet Corporation for Assigned Names and Numbers (ICANN) opened up applications for new gTLDs which could include virtually any word as the extension.  ICANN received nearly 2,000 applications for approximately 1,400 unique new gTLD extensions. ICANN’s new gTLD program is expected to substantially increase the number of domain names on the Internet.  So the question is, "Are you the Master of your Domain?"

Brand owners looking to protect their trademarks from being adopted as a domain name registered through one of these new (gTLDs) now have their chance. A new “Trademark Clearinghouse” is now open that allows brand owners to register their marks in a central repository before hundreds of these new gTLDs (e.g “dot brands”) are launched.  In this ever-expanding online space, the Trademark Clearinghouse serves as an additional tool for brand owners to proactively protect their trademarks from those attempting to improperly register a domain name that includes your federally registered trademark.  

The Trademark Clearinghouse will accept and verify federally registered trademarks and trademarks protected by statute or treaty, and every new gTLD registry will be required to use the Trademark Clearinghouse database to provide trademark protection services to brand owners

Most notably, the “Trademark Claims” service will act as a watch service for brand owners. During the first 60 day period after a new gTLD launches, the Trademark Claims service will monitor domain name applications and send a warning to any applicants who attempt to register a domain name matching a trademark registered with the Clearinghouse. If the applicant still proceeds with registering the potentially infringing domain name, ICANN will notify the trademark owner, so the owner has an opportunity to challenge.

The Trademark Clearinghouse also includes "Sunrise Services," which allow participating trademark owners an advance opportunity to register domain names for new gTLD registries (for instance .bank, or .car or .app or .shoes, .retail) in a top level domain before registration is generally available to the public.

Filing fees for registering a trademark with the Trademark Clearinghouse must be paid annually, with discounts available where you prepay for up to five years in advance.  For example, the filing fee for one year is $150, for three years is $435, and for 5 years is $725. Registration of a trademark with the Trademark Clearinghouse includes linking up to ten domain names per registration. Trademark Registrations can be designated for one, three, or five years and are re-validated once each year.

Trademarks can be registered with the Clearinghouse at any point, but those trademark owners who register their marks with the Clearinghouse during what ICANN deems the "Early Bird Registration Period" will be granted extended protection. Trademarks registered during the Early Bird period will not expire on the first anniversary of the registration date, but will instead expire on the first anniversary of the date the Early Bird Registration Period closes.

 

So, what's the moral of this story? The early bird catches the worm.

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© Mari-Elise Taube, Stites & Harbison, PLLC, 2013

Send email feedback- mtaube@stites.com

Determining Whether Computer-Implemented Methods (software) and Computer Systems are Patent Eligible Remains an "Abstract" Exercise

The test for determining whether particular computer-implemented methods (software) and computer systems (executing software) are merely eligible for patenting remains "abstract" in view of the en banc Federal Circuit in CLS Bank v. Alice Corp.  (CLS).  The CLS decision assessed U.S. patent eligibility of computer-implemented methods and systems based on whether the claims are directed to "abstract" ideas, and thus, not patent eligible, without actually defining "abstract" and/or "abstract ideas."  Perhaps, like Justice Potter Stewart in his infamous comment regarding pornography, the Court knows an abstract idea when it sees it.  However, for the rest of us, a test for "abstract ideas" needs to be more concrete, tangible and definitive and less obtuse, or dare I say, less "abstract."  Questions still remain as to what constitutes patent eligible computer-implemented methods (software) and computer systems and how one determines their patent eligibility.

The most "abstract" aspect of U.S. computer-implemented (software) patents is the 135 page judicial opinion(s) of a very divided en banc Federal Circuit bench.  Five of the 10 judges join a "majority" opinion, and five other judges concurred in part and dissented in part, in the en banc review of a lower district court's decision.  The CLS decision involves a determination of whether four subject patents, directed to computer-implemented methods (software) and computer systems were eligible for U.S. patent protection at all.  The "majority" opinion appears to give little useful and reliable guidance for allowing one to accurately and consistently determine whether a computer method, software, or even a computer system running software is eligible for consider of patentability.  Without reading a single word of the 135 pages, the shear number of differing opinions (majority, concurring, and dissenting) gives you a hint that there is no consensus of how one should analyze and determine eligibility of computer-implemented methods and computer systems.

The "majority" reiterates the widely accepted judicially created exemptions of patent ineligibility for claims directed to 1) laws of nature, 2) natural phenomena and 3) abstract ideas.  However, the majority appears to equate 3) abstract ideas with 1) laws of nature and 2) natural phenomena.  Moreover, the majority never defines the term, "abstract ideas."  Instead, the majority merely refers to prior cases of claims directed to 1) laws of nature and 2) natural phenomena as being directed to "abstract ideas". 

Finally, although Judge Moore, in her dissenting opinion, alleges that "this case is the death of hundreds of thousands of patents, including all business method, financial system, and software patents as well as many computer implemented and telecommunications patents," the majority opinion, itself does not appear to be a real "game changer".  One slight footnote to this is with regard patent eligibility of computer systems.  Due to a tie in judges' votes, there was no majority decision with regard to patent eligibility of the computer system claims.  As a result, the lower district court's decision on patent ineligibility of the subject patents' system claims stood.

In summary, the CLS opinion does not appear to change the law of U.S. patent eligibility.  However, the decision does make it more difficult to access patent eligibility of computer-implemented methods (e.g. software) and systems and it introduces more uncertainty as to whether a patent/patent claim will be found to be patent eligible.

In view of an ever uncertain and indefinite test for patent subject matter eligibility based on an undefined criterion of "abstract ideas," patent practitioners and business people need to consider all functional aspects of computer-implemented methods (software) and draft patent claims of varying, ever more detailed scope and directed specific implementations (embodiments) so as to cover all bases and thereby ensure patent eligible subject matter.

© Stephen J. Weyer, 2013

Send email feedback- sweyer@stites.com

Even IP Law360 gets "confused" when discussing Apple, Inc.'s trademarks

Even the tried and true, widely read in the legal profession, IP Law360 online electronic publication (or its editor/title writer) gets "confused" when it comes to the distinction between TRADEMARKS and PATENTS.  Today's (May 9, 2013) IP Law360 had an article entitled, "Apple Escapes Publishers' Patent Suit Over 'iBooks' Mark," by David Mcafee.  Regrettably, the lawsuit described in the article is really about an alleged trademark suit brought against Apple in the southern district of New York in 2011 (1:11-cv-04060), by a publisher of physical books sold under the name, "ibooks." Spoiler alert...judge ruled for Apple.

By no means is this an indictment of the author of the Law360 article.  In fact, the article's first sentence correctly identifies the issue as being a trademark matter.  No, this merely underscores the fact that the general public, business people, and arguably editors of IP Law360 do not appreciate the distinctions and differences between trademarks and patents. 

Now for the boring definition section of this post so as to dispel any likelihood of confusion between trademarks and patents...

Trademarks are words, slogans, logos, designs, sounds, colors, and alike which identify goods and services with a unique origin, producer or supplier. 

Patents (utility) cover the functional features or aspects of a machine, article of manufacture, chemical composition, processes, and software.  Design patents cover the look (ornamental design or appearance) of an article of manufacture.

© Stephen J. Weyer, 2013

Send email feedback- sweyer@stites.com

Innovative Intellectual Property Clinic at the University of Dayton School of Law Provides Students with a Real World Law Practice Experience

Guest blog post by Gregory Richards, a third-year law student at the University of Dayton School of Law and an inaugural member of its IP law clinic.  He has a technical background in the field of chemistry, with a focus on inorganic complexes and electrochemistry.  Greg recently passed the U.S. patent bar examination and is currently seeking a patent prosecution position at a law firm upon graduation from law school in May.

INNOVATIVE INTELLECTUAL PROPERTY CLINIC AT THE UNIVERSITY OF DAYTON SCHOOL OF LAW PROVIDES STUDENTS WITH A REAL WORLD LAW PRACTICE EXPERIENCE

Once again, the University of Dayton School of Law (UDSL) is at the forefront of the movement to provide students with practical experience in the practice of business and intellectual property law.  This spring, the Program in Law and Technology (PILT) at UDSL launched the inaugural Entrepreneurship and Intellectual Property (IP) Law Clinic.  Much like traditional law school clinics, student associates represent clients under the supervision of licensed attorneys.  While traditional law school clinics focus on providing students with courtroom experience, the IP Clinic is geared toward students interested in working as transactional attorneys.  

With UDSL’s emphasis on experiential learning in mind, the IP Clinic was designed to provide students with practical experience.  Students meet with clients, perform legal research, draft memoranda and documents, and perform other client-related tasks.  Additionally, students are focused on helping innovators protect their inventions and aiding new enterprises select and implement their corporate structure.  Furthermore, the IP Clinic at UDSL provides an excellent complement to the PILT externship program, which offers students the opportunity to gain practical experience by working for governmental agency, law firm, corporation, court or legal aid.  

IP Clinic students truly are having the exact same experiences as we as practicing IP attorneys at law firms or as in-house counsel have every day, from conducting in-take interviews with clients, explaining complex legal issues to business people, developing creative solutions to protect clients’ IP rights, etc.  The IP Clinic gives UD students a leg up on their competition and distinguishes its students from other law school graduates interested in pursuing a career in intellectual property law.  

-  Stephen Weyer, member of the UDSL’s PILT Advisory Council and UDSL graduate, 1997.

The IP Clinic is collaborating with a number of University of Dayton units or offices, including the School of Business Administration, the Innovation Center, the Design and Manufacturing Clinic, the Office of Legal Affairs, and the University of Dayton Research Institute.  These units provide the clients and matters for the IP client students to tackle.  “The innovation, entrepreneurship and creativity that takes place right here on the university campus is fertile ground for IP Clinic students to learn how to meet the needs of actual clients,” said Kelly Henrici, executive director of the Program in Law and Technology, who is supervising the IP Clinic.  This diverse group of university clients exposes students in the IP Clinic to a variety of business and intellectual property law matters, including patent, copyright, and trademark law.

The IP Clinic also exposes students to the business/administrative aspect of the practice of law.  Throughout the semester, the students are responsible for their own time management, billing matters, document management, etc.  Part of this is accomplished using advanced case management software used by many law firms.  Accordingly, the IP law clinic truly mimics a law firm environment giving the students “real world” practical experience. 

In addition to the client-related work, students in the IP Clinic are required to attend a weekly class meeting.  This weekly class meeting provides the students with an opportunity to discuss their work with other members of the IP Clinic, receive feedback and advice on drafts, and promotes teamwork skills that are essential for effective lawyering.

The IP Clinic at UDSL is an innovative method of providing law students with practical experience in the fields of business and intellectual property law that is sure to facilitate the transition from student to practicing attorney.  We fully expect to see other law schools across the country follow the lead of UDSL by offering their own version of a clinical experience devoted to business and intellectual property law.

© Stephen J. Weyer 2013

Send email feedback- sweyer@stites.com

Patenting... Real. Comfortable. Genes II ? Judgment Day

Last December, I reported that the U.S. Supreme Court agreed to hear the appeal in ASSOC. FOR MOLECULAR PATHOLOGY V. MYRIAD GENETICS, INC. to decide whether isolated human genes are patentable under the U.S. Patent Act (35 U.S.C. § 1 et seq.)   Today, is "judgement day" {well, sort of} as the Supreme Court hears oral arguments on whether isolated human genes are patentable.  The true "judgement day" will come when the Court issues a decision, expected to be by the end of the Court's session in June.  Many have strong opinions either for or against gene patents. In order to have an intelligent, informed debate, it is important to consider why we have a patent system at all.

The Framers of the United States Constitution knew of the importance of technological progress.

The Congress shall have the 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. (U.S. Constitution, Article I, § 8, clause 8).

This provides inventors with an incentive to create new products and processes. It also gives companies and investors (e.g. venture capitalists and stockholders), incentive to invest capital looking for a return on their capital investment.

Congress has limited the duration of the monopolistic protection. In return for the protection, the inventor must disclose his or her invention to the Patent Office which, in turn, discloses the information to the general public.

The Patent Act was drafted to accomplishes two goals. First, it encourages innovation and discovery through its incentive of limited monopoly Second, the patent system promotes the disclosure of useful technology to the general public by putting it in the public domain.

Opponents of gene patents say, "Keep your hands off my genes." They argue that human genes are naturally occurring, not the creation of human hands, and thus, not the subject of patents. Therefore, opponents say that genes are in the public domain for all to use. Further, some opponents believe that patenting genes stifle innovation of other researchers who fear lawsuits for patent infringement from the patent owner if they conduct their own research pertaining to the patented gene. In addition, some proponents believe that for public policy reasons and pubic health concerns, physicians should not be prevented from access to the best diagnostics and therapeutic treatments which may include the gene discoveries of another.

Proponents of gene patents assert that biotech and pharmaceutical companies need patent protection for isolated genes. These companies spend millions (or even billions) of dollars to isolate genes and to discover the role that these genes play in disease or in the therapeutic treatment of disease. Absent patent protection, anyone could use the million/billion dollar discovery without having to invest a single dime. Further proponents of patenting genes say that no one would invest in companies if anyone could use their discoveries for free. As a result, biotech companies would cease to develop new diagnostics and therapeutic treatments predicated on isolated gene sequences. Therefore, without the financial incentive of patent protection, new genetic diagnostics and therapeutic treatments will never be made. Without patent protection for gene discoveries, entire industries will be lost and/or negatively impacted. Accordingly, proponents argue that patenting genes accomplishes the two goals of the Patent act, offering both economic development and providing a pathway for new discoveries of disease diagnostics and therapeutic treatments.

© Stephen J. Weyer, Stites & Harbison, PLLC, 2012
Send email feedback- sweyer@stites.com


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Can you hear me now? Apple's EarPods accused of infringing Hearing aid company's HearPods

Apple Inc., owner of the U.S. federally registered marks, EarPods ® and Apple EarPods ® has been accused of infringing the trademark of Randolph Divisions' HearPods ®.  It's a struggle to believe that a consumer of hearing aids (presumably, a sophisticated consumer and one not likely to make an impulse purchase of a hearing aid) would think that Apple's iPod/earbud-style earphones, Earpods®, are associated with a company known for making hearing aids.  Therefore, it seems unlikely that such a consumer would be confused as to the origin of Apple's Earpods and believe there is a connection with the hearing aid company Randolph Division.  Further, unless you are both visually impaired and hearing disabled (i.e., the Helen Keller's among us), it's hard to envision that one would not see the difference between the marks "EARpod" and "HEARpod".  Finally, what makes the alleged infringement even more incredulous is that the markets for the two products, mobile audio/music and hearing aids, are completely different.  In the end, it seems like Randolph Divisions will have an uphill battle to prove trademark infringement.

© Stephen J. Weyer 2013

Send email feedback- sweyer@stites.com

Meet us at BIO in Chicago (April 23-25)

 

 

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