Archive for external fatigue
After seven years of working with intellectual property and innovation in China, I’ve seen some of the ups and downs as well as the gross misunderstanding of Chinese innovation and IP in the West. I’d like to briefly summarize what I’ve seen.
First, when it comes to innovation in science and industry, graduates of Chinese universities are not the drones and clueless copyists that many in the West seem to think they are. Yes, they have been through intense educational processes that emphasize memorizing tons of material and respecting what teachers say, but this hardly means they cannot think for themselves or innovate. In fact, the mastery of material that they have obtained gives many of them the skills needed to apply sound principles in creative ways. he truth about innovation is that in many cases, skills and knowledge matter, and the more you have at your fingertips, the more you can do with it.
But yes, in an innovation session, a facilitator is likely to find a lot of people looking down at the ground and not contributing. This can often be due to having the wrong people in the room and not providing the right setting and incentives. If the boss is there, people might be afraid of showing him or her up or afraid of saying something risky and possibly wrong. So get the boss out of the room. Then turn your event into a competition. Have incentives for contributing. It can be as simple as “no bathroom break until we have 10 ideas in the board” or prizes for the team with the best concepts. But once it becomes clear that there are reasons to contribute and little risk in contributing, you’ll face the problem I see most now: getting the group to slow down and limit their responses. “I just needed 5 concepts, not 30, but thank you!” A friendly competition brings out the best in many Chinese innovators, and I’ve been deeply impressed with their creativity and insights.
Innovation is very healthy in China. China is leading the world in innovation in many targeted areas, greatly outpacing the West in areas such as nanotechnology, green energy, AI, etc. You haven’t seen the power of great smartphone apps until you’ve seen how people are able to use WeChat over here for so many things: paying utility bills, ordering and paying for meal, participating in free videoconferences, sending gifts, finding when the next bus is coming to your stop, reserving seats at a movie theater, easily forming groups to share text, photos, and videos for an upcoming or current event, etc.
China has wonderful brands, cool business models, increasing quality and safety, brilliant entrepreneurs, and a booming market in many fields. It’s a dazzling and beautiful place with great hope for the future.
On the other hand, there are some great “fatigue factors” that make things tough on some innovators and entrepreneurs. The biggest issue may be the uncertainty in regulations. Here in Shanghai, for example, thousands of entrepreneurs who have spent years building their businesses in small shops along many classic streets of Shanghai suddenly found that all the shops in certain areas would be torn down to beautify the street or convert it to high-end hotels or something. Many times all that happened was that a flourishing market was eviscerated and sterile walls were left lining a street that suddenly was missing the flavor it had nurtured for decades. The purging of small businesses has been painful to watch and has also been frustrating to local residents who can no longer get the goods and services that used to be around the corner. Now they have to travel to go to larger stores that are less convenient and often more expensive.
Last week, I was thrilled to learn that the Central Committee of the Communist Party in Beijing sent out a very wise directive to cities in China urging them to be cautious about unnecessarily closing shops and markets on their streets. It noted that this process is removing important economic zones that convey a crucial part of the flavor of China. Amen! I grieve for the thousands who lost their jobs over these painful sweeps, and hope healthy local businesses and markets can continue to thrive for the good of both the entrepreneurs and customers like me. How I miss some of those little shops and businesses that have been such a precious part of my experience in Shanghai.
Unpredictable rule changes can hurt innovators in many ways. Some innovators just get a business going only to learn that a new rule now forbids the import or sale of a product they brought to China. Others learn that an area that was zoned for industry is suddenly no longer open to their business and perhaps an entire factory has to move. These things happen in the West as well, but the process here is less visible and harder to cope with in many cases, in my opinion, so those creating businesses here need to be both flexible and diligent in understanding the needs and plans of government so they can foresee problems or adapt to them quickly. I’m not saying it’s overwhelmingly difficult, but innovators and entrepreneurs do need to be prepared watchful, and always have a plan B. That’s good advice for any nation, of course.
The challenges from rule changes may be most severe for large companies, where a policy change can affect huge areas of one’s business or involve formidable costs. On the other hand, large companies often benefit greatly from relationships with other entities that can give them great advantages in innovation. And fortunately, the government is often understanding of the impact that rule changes can bring, such as the requirement to move a factory, and will often offer incentives that take way much of the pain and make the change possible.
Part of the good news is that officials at all levels in the country are increasingly recognizing the importance of aiding and not hindering innovation and entrepreneurs, and so in spite of some of the risks of rule changes, there is a general climate of encouragement and help for innovation. This can benefit large and small companies. It helps to be involved, to unite with good organizations to stay informed and build increasing influence, and to also be close to your community, making sure that your business is involved in bettering the community and lifting others. Such organizations and innovators who aren’t just looking out for themselves but recognize the greater good and seek to serve can have lasting impact on this nation.
Innovation is real in China and is becoming stronger and more important every year. It is a great place to pursue innovation and a great place to develop and enforce meaningful IP. More on the IP issues later. For now, give China a chance and look beyond the stereotypes that are often projected as if they were facts. China has changed greatly in the past two or three decades. Come see what’s really happening over here!
A book on World War II teaches a lesson for today on innovation. In Churchill and Orwell: The Fight for Freedom by Pulitzer-prize winning author Thomas E. Ricks (New York: Penguin, 2017), we learn about some of the reasons England struggled to defend itself effectively in dealing with Germany. A key problem discussed by Ricks was England’s poor state of preparation with inadequate machinery, feeble industrialization, weak supply chains, etc., that made it hard to fight a serious war and led to embarrassing disasters like the rapid loss of Singapore, their supposed fortress in southeast Asia. Close to home in Europe, Britain had a hard time just moving troops around — they often had to walk — and the Brits were amazed at how quickly their American cousins could mobilize when they came to the rescue. Why was England so poorly prepared?
England, as you will recall, was the birthplace of the Industrial Revolution, yet by the time of the War, they were awkwardly behind in many of the basic technologies they would need. How could this happen? Ricks comments are insightful:
Managed by family members more interested in reaping dividends than investing in new machinery and other gear, “British firms were unable to adopt modern, best-practice technology,” concluded business historian Alfred D. Chandler Jr. As a consequence, Britain’s brilliant university research generally did not make the transition into factories. Britain had led the first Industrial Revolution of coal and steam power, but generally sat out the “Second Industrial Revolution” of the late nineteenth and early twentieth centuries, built around oil, chemicals, metals, electricity, electronics, and light machinery, such as automobiles. By the end of the 1940s, it would have neither an empire nor an economy capable of competing with those of other major powers. As Correlli Barnett put it, the reality was that by the time World War II ended, the British “had already written the broad scenario for Britain’s postwar descent to the place of fifth in the free world as an industrial power, with manufacturing output only two fifths of West Germany’s.” Interestingly, Barnett was the keeper of the Churchill Archives at Cambridge University from 1977 to 1995. [Ricks, pp. 203-204]
Something similar happened in China, which once led the world in innovation and GDP, but from the Qing Dynasty until the late 20th Century, in part due to apathetic leaders unwilling to invest in or even open the doors to innovation and technology, China missed out on much of the Industrial Revolution. Only through massive reform and exerted effort in recent decades has China begun its return to a position of global leadership in innovation, IP creation, and economic growth.
In the paper industry, which I’ve been close to for many years, it’s clear that the American paper industry has largely fallen into the same trap that nearly cost Britain its freedom and did cost many lives unnecessarily. The American paper industry has largely failed to invest in new technology and relies heavily on antiquated paper machines and pulp mills that are decades behind what we have in Asia (China and Japan in particular). Their slower, less efficient machines and less efficient plantations put them at a distinct cost disadvantage. Instead of taking steps to compete better, the US industry too often tries to rely on protective legislation to raise tariffs on imported paper and make everyone in the nation pay much more for their paper than they should. The real problem is not Chinese competition, but American businessmen falling into the same pattern that nearly cost Britain the war: focusing on immediate profit and dividends while neglecting the future.
Each industry, whatever it is, needs to build for the future with investment in innovation and a willingness to boldly cope with the threats and opportunities of disruptive innovation. If your industry is dominated with leaders who feel like they can just milk their business as a cache cow with no need to invest in the future, that industry will fail.
Many of the greatest inventions in America came from immigrants. See Steve Brachman’s article, “American innovation has been fueled by immigrant inventors” at IP Watchdog. Nearly all of our inventions, in fact, came from people who were either immigrants or descendants of immigrants (sometimes we seem to forget our own roots!). Immigrants with skills and a desire to succeed often become great entrepreneurs that create jobs and wealth that benefit the rest of us. Today, unfortunately, there is a lot of misunderstanding about immigrants.
Sadly, many people with great innovation potential and good education find legal immigration is nearly impossible or takes many years. They are punished with unreasonably high barriers to entry. Making the barriers greater for them will only hurt the economy and our innovation potential.
The Sovereign Man Explorer newsletter (from Sovereignman.com) of Feb. 5, 2017 has an excellent article on immigration to consider:
Everyone Loves a Good Ol’ Immigrant Witch Hunt!
Republicans aren’t the only ones who want to limit immigration. While democrats are crying foul over Trump’s policies towards immigrants, they have initiated a little foreigner witch hunt of their own.
A whole bunch of Democrats in Congress introduced a bill that would have the Secretary of State, and other federal agency directors, create a list of foreigners believed to have manipulated the election, or tampered with American political parties.
It would give the government power to freeze their assets, and bar them from entering the United States.
And this would happen based solely on the investigation and recommendation of the State Department; no due process.
What this means:
This is some pretty weak criteria for having your assets frozen and being barred from entering America. True, Trump’s plan to ban all immigrants from particular countries is extreme as well, but at least he doesn’t plan on freezing immigrants’ assets.
This essentially could rob immigrants’ of the products of their labor, while stifling their international mobility, just because their name ended up on a list.
How much evidence is required to end up on the list? We don’t know. Can they get off the list, have their travel allowance returned, and have their assets unfrozen? We don’t know. Will this be used politically against enemies of politicians? We don’t know.
This is a vague and ill defined bill which gives more power the the Feds to arbitrarily harass immigrants. And it proves this attitude is held by both major American political parties.
Innovation thrives when there is certainty and an environment where the risks of developing a new business or other innovation can bring returns. When there is the risk that government with the stroke of a pen can seize assets without due process or otherwise take everything by changing the rules of the game, there is uncertainty that chokes innovation. Scaring away talented innovators and threatening them with the loss of assets for supporting a political opponent will leave all of us worse off.
Of course, a government so out of control that it will seize immigrants’ assets for arbitrary reasons is a threat to all of its citizens as well. It is the ultimate source of innovation fatigue and worse.
Be careful about the vehicle you’ve been driving. As sturdy, tangible, useful, and inventive as it looks to you, it may turn out to be merely an abstraction, perhaps nothing more than the mere idea of “transportation” or “going places,” making it unworthy of the thousands of patents protecting its numerous technologies — if the USPTO and America’s elite judges get their way. An abstract automobile? You don’t want to be caught dead driving one. Unfortunately, since the USPTO’s Patent Trial and Appeal Board (PTAB) just ruled that an MRI machine is abstract and thus not patentable under the odious and vague principles of the Supreme Court’s recent Alice decision, it could be that automobiles and virtually every other machine under the sun could be next on the anti-patent chopping block. Your trusty Toyota or your faithful Ford are about to go abstract on you, courtesy of the USPTO. Look out.
In the PTAB’s elite view, as Gene Quinn explains, all the physical wizardry of the mighty MRI machine as claimed in a recent patent application for an improved MRI is just an abstract idea based on the abstraction of “classification.” It defies logic and defies the requirements of the Alice decision and the USPTO’s rules for applying Alice, but the PTAB has become a patent munching zombie that doesn’t seem bound by logic or law. They are one of the strongest forces promoting innovation fatigue. Many innovators are just giving up or going to other nations where IP rights are more meaningful.
The anti-patent forces that have taken hold of far too many influential posts in America view property rights and especially intellectual property rights as a barrier to the ideal society they envision. If only we could get rid of patents, they seem to think, drug prices would fall and Obamacare, for example, would not be such a disaster. But the bounty some intellectuals promise by weakening property rights is an illusion, for without IP rights, what is the incentive to take on the risks and costs of innovation if you cannot benefit from the occasional successes that come from your uncertain work? If your hit product can be taken and marketed by others who did not have to spend so much time and money developing it, then the inventor is often at a competitive disadvantage to everyone else. Why bother?
America’s war on patents is a war on the future of innovation. It’s a war we cannot afford to lose.
As I watch the decline of the US patent system, I have to marvel at how much loss the world is facing through the crushing barriers to innovation and job creation in the U.S. Once the beacon of innovation for the world, now would-be innovators are afraid to take the risks required to bring their new products and services to the market because they cannot get the protection that should be theirs when IP rights are strong. If a Google or Microsoft takes their invention, the great equalizer of patents will not be there for them.
In the name of advancing innovation, Congress created a monster called the American Invents Act. This was done without input from the small inventors and entrepreneurs of the world, where most innovation and job creation occurs. It was based on input from the giants like Google who despise patents (other people’s patents, that is). But thanks to the AIA, there is now a host of new ways to destroy patents and they are being used with startling effectiveness.
A key component of the war on patents is the new “patent death squad,” that Patent Trial and Appeal Board. Based on the statistics from their work, there is little hope left for patent owners. See Gene Quinn’s excellent report, “Misleading PTO statistics hide a hopelessly broken PTAB” at IPWatchdog.com. Startling, troubling, but accurate.
The war on innovation also includes action from the courts, especially the Supreme Court, which has given judges bold new weapons to invalidate patents by calling their subject matter “abstract” — a deadly word that is vague, which the Supreme Court has not even attempted to define. The possibilities for patent destruction under the Supreme Court’s new Alice test are immense, and I’ve seen some great innovations blown apart with that weapon.
The USPTO, now led by a Google attorney, has repeatedly taken a hostile attitude in how they interpret laws and create policies regarding patent examination. The results are shameful.
The politicians and their gargantuan backers are winning the war against IP and innovation in the US. It’s time for Congress to pare back the damage they have done with the AIA, and for champions of innovation to rise and demand a more equitable system.
The steady loss of IP rights in the United States is alarming. Big companies like Google and Apple tend to preserve or expand their market power and in IP battles, they tend to get their way through their money, influence, friends in high places, and market clout. But for lone inventors and smaller companies, the IP landscape has become forlorn. The patents that were essential for establishing a business and protecting themselves from outright theft (including theft from the big companies that tend to get their way) are now much harder to obtain. Once obtained, they are much harder to enforce. Patent opponents are now given broad new powers to invalidate patents. Incredibly, the IPR system (inter-partes review) that allows a challenger to easily attack an already issued patent is resulting in nearly 80% of challenged patent claims being found invalid.
What this means is that the USPTO, charged with the responsibility of issuing only valid patents, after all the rejections and challenges they give to inventors in the patent prosecution process, is essentially saying that their quality control process is so bad that they have goofed 80% of the time and issued claims that never should have been allowed. Something is seriously wrong here.
The vast new uncertainties in America’s IP system is crushing innovation. Innovators are wondering why they should file in the U.S. Some are going to other nations to launch their business. Others are abandoning hope. This comes at a dark time on the economic landscape when we need innovation and hope more than ever before. Giving Google more power than ever to crush competitive patents is not the answer. Eliminating software and knowledge-economy-based inventions as patentable subject matter is not the answer. Allowing patents to be easily invalidated is not the answer.
Americans need to demand a return to respect for IP rights and create an innovation-friendly society again.
Abraham Lincoln said that the patent system “added the fuel of interest to the fires of genius.” Today the fires of genius and the fire of innovation itself is getting doused with something less helpful than fuel. These fires are being cooled and, in some cases, extinguished with harsh attacks on the IP rights that once enabled and motivated lone inventors and small businesses to take the fruits of their genius to the market.
The owners of small businesses, the people who generate most of the innovation and business growth in the United States have good reason to be worried. Their ability to attract funding through valuable intellectual property is being compromised. Their ability to protect their products and innovations from the power of corporate giants is being whittled away. This has come from many quarters, but there is a widespread anti-patent movement driven by politics and misinformation. It’s the bitter fruit of a bitter anti-property rights movement that exaggerates the threat of a few bad actors to justify widespread weakening of property rights in ways that will hurt the economy and our society for years to come.
We have seen a recent series of Supreme Court cases that have made it much harder to obtain patents and enforce them. We have seen massive changes in US patent law that make it easier to invalidate patents after they are granted and make it harder and more costly to stop infringers if your patent survives. Now the bogeyman of “patent trolls” is held up as a threat to America that requires more sweeping “patent reform” to make it even harder to enforce a patent, and it looks like both parties are united in a quest to do “something big” to shake up the IP rights that helped drive the American economy for so many decades. Corporate giants benefit from this reform as it clears away the annoyance of other people’s IP rights standing in the way of their marketing muscle. But the economy as a whole and the rights of many are hurt in this process this amplifies innovation fatigue .
Several recent articles highlight just how serious the problem has become. Louis Carbonneau in “Toxic Asset: The Gradual Demise of the American Patent” (IPWatchdog.com, December 10, 2014), surveys the radical changes in the past two or three years:
On the judicial front, in 2014 we saw no fewer than 5 Supreme Court decisions going against patent holders on the various subjects of obviousness (a key test for patent validity), what constitutes “abstract ideas” (which now undergo a more stringent test for patentability), business method patentability, indefiniteness (how you construe claims), reasonable royalty (how you calculate damages), willful infringement (how you punish the “bad actors”) and fee shifting (making losers pay for winners legal fees). All of these decisions have collectively made it harder for patent owners to: i) maintain the validity of duly issued patents (previously presumed by law), ii) pursue infringement claims, ii) prove damages (let alone treble damages), iv) have open discussions with potential infringers prior to litigating, and have left the unsuccessful patent owner at risks of paying millions in legal fees to the other side if the judges so decides.
Parallel to judicial reform at the federal courts, recent US patent reform with the American Invent Act (AIA) introduced a new post grant review mechanism called Inter Partes Review (IPR) which allows a party to challenge the validity of any issued patent before the Patent Trial & Appeals Board (PTAB). Strangely, despite the PTAB being an emanation of the same USPTO that delivered all these patents in the first place, there is no longer a presumption of validity before the PTAB for the patents being challenged while other rules make it easier to invalidate patents based on prior art.
Finally, on the political front, in 2013 the US House of Reps. passed the Goodlatte bill, which would erode rights conveyed to all patent holders despite being primarily directed at NPEs. It is now expected that the new Republican led Senate will revive the bill -currently on hold- in early 2015 and, with a rare showing of bipartisanship from the White House, it is expected to be signed into law. At the same time, 27 US States have passed or are in the process of passing laws that make it harder for people to assert the patents they own.
Carbonneau goes on to explain that in recent Federal Circuit cases, patent owners are being crushed, and in Inter Partes Review (IPR) cases before the USPTO, nearly 80% of the owners of challenged patents are being told by the USPTO that their patents are not valid over the prior art that the USPTO itself supposedly considered before granting the patent in the first place. Carbonneau puts it rather wryly:
The most interesting statistics come from the PTAB [the USPTO’s Patent Trial and Appeal Board, which processes IPR cases] because it only focuses on validity issues based on prior art; the very same prior art patent examiners are supposed to have found and analyze prior to issuing a patent. Since patents going through IPRs are usually the same ones that being litigated, you would assume that owners did a lot of due diligence before investing in a costly patent lawsuit. Well, the PTAB is declaring 77.5% of reviewed patents invalid! And this is not limited to “abstract” software; patents related to biotech and pharmaceuticals, medical and mechanical devices, are being invalidated at an even higher rate! Remember, this is an offspring of the very same agency that inventors paid thousands of dollars in the first place to review applications and issue their patents. Now, after having to pay a quarter to a half million dollars in legal fees (average cost of an IPR procedure for a patent holder), the same agency is telling patentees nearly 80% of the time: “Very sorry we made a mistake; we would not have allowed your application had we looked more carefully for existing prior art. And no, there is no refund available.”
Personally, I cannot think of any industry that could survive more than a month with a nearly 80% defective rate, let alone by forcing you to spend a fortune for the “privilege” to confirm that indeed your title was invalid in the first place! Only a government can come up with such a broken system and get away with it.
The impact of these anti-patent efforts has been a surprisingly sudden break from the trend of increasing IP litigation, with litigation in 2014 down about 13% from the previous year according to a new 2015 PwC report on patent litigation. The problem of explosively increasing patent litigation, a common excuse to justify the slashing of patent rights, is not supported by the data.
Richard Lloyd, writing for the IAM Blog, draws this observation from the PwC report:
Of these three classes [of patent litigants considered], NPE [non-practicing entity] companies have been successful 31% of the time in patent cases brought since 1995; this compares with a success rate for universities and non-profits of 48% and a lowly 18% for individual inventors. Individual patent owners also do far worse with damages pay-outs, getting a median award of $3 million compared with $11.5 million for company NPEs and $16.2 million for universities/non-profits.
There could be many reasons for individual inventors doing relatively badly. Although the PWC study doesn’t provide any, it’s easy to speculate that small inventors may have lower average quality patents to begin with, while they probably don’t have the same kind of litigation savvy as other NPEs and are much less likely to have access to the same kind of litigation expertise that larger, better funded patent owners can turn to.
But what PWC’s numbers also strongly suggest is that the US patent litigation system is strongly stacked against small, patent owning entities. Bearing this in mind, it is worrying that the main packages of reform proposed in the House of Representatives (the Innovation Act) and the Senate (the PATENT Act) are only going to penalise them further.
Lloyd notes that potential irony now that many lone inventors, recognizing that they have little chance of winning and have almost no chance of affording the punitive legal bills they may face if they sue and lose, may be more likely to turn to NPEs (“patent trolls”) for help as the most practical way to realize any benefit from their work.
There is a need to rebuild an innovation climate in the United States, starting with educating our leaders about the need for IP rights and the value of patents. If we don’t teach this lesson from within, it will eventually be taught rather loudly from without, for Europe and China are both moving to strengthen IP rights and strengthen IP enforcement. Europe’s Unitary Patent system could be a boon to IP there, though much remains to be seen, but the changes in China are strong and dramatic. That nation has gone from no patents and no IP system in the early 1980s to the world’s biggest source of IP generation and IP litigation, with many changes steadily strengthening the nation’s IP system. There is a long ways to go for China still and there have been some setbacks, but at current rates we can see China becoming a leading source of global innovation while the US loses its lead.
Will the flames of innovation be largely quenched in that nation? Much depends on what we do with IP rights now, the rights that will shape our culture and economy for decades to come. May the fires of genius be encouraged with something other than the cold water Congress and Courts have been sloshing.
Many intellectual property practitioners worldwide are scratching their heads over what is happening to IP in the United States. There’s a revolution underway that over the past few years seems to have steadily eroded the value of patents and any semblance of predictability and order in the law. Patents can still be valuable, if you are lucky and have the right connections. For ordinary people and companies, patents, once the great equalizers against big companies, are now an unreliable tool. The erosion of IP rights is becoming a major factor in the growing problem of innovation fatigue in the United States.
This erosion has been achieved from a confluence of powerful currents are leading in one strong downhill direction. Congress has enacted patent reforms that make it vastly easier to challenge and destroy a patent and much harder to realize value, all of which favors those with marketing muscle, political influence, and existing market share. The Supreme Court has handed down a series of patent decisions that have eroded the value of patents. These blows have been especially forceful in the pharmaceutical and biotech fields, wiping out the value of many patents linked to “natural products,” and in the software and business method areas (e.g., Bilski and most recently Alice), making it extremely difficult to obtain IP in the technical fields with the greatest potential for innovation and growth as we move from the coarse manufacturing of the industrial revolution into the knowledge economy. Alas, in such fields and many others, the Supreme Court has created a new subjective tool against patents by ruling that anything “abstract” cannot be patents, while refusing to give any clear, non-abstract definition for “abstract.” This vastly adds to the uncertainty and chaos in many IP areas. In addition to these and other abuses of IP rights from the courts and Congress, the USPTO itself has gotten into the act with its own interpretations of judicially created rules that go even further than required by the courts in limiting IP rights. Sadly, we can expect ongoing hostility toward IP from the USPTO now that it is led by someone from one of the most powerful anti-patent (or, more accurately, anti-everyone-else’s-patent) force in Corporate America, Google, the former employer of Michelle Lee. Her selection as Director of the USPTO by President Obama came as a real surprise to many IP workers, but it was less of a surprise to those who see the political power Google has amassed.
These troubling events are now compounded by one of the most troubling IP cases in recent memory, a dramatically unjust case in which the Court of Appeals for the Federal Circuit (CAFC) totally disregarded the extensive fact-finding of previous courts, a jury, and the USPTO regarding the non-obviousness of some patents, and instead turned to so-called “common sense” to fill in the missing details of the prior art to render patents invalid after they had withstood repeated and thorough tests finding them to be valid and non-obvious. This was done in violation of the duty of the CAFC to respect the factual determination of the previous trial court in an appeal. Instead, the CAFC acted like a trial court, but without the information and testimony needed. “Common sense,” like “abstraction,” can be pulled out of the air at whim to poison a patent–when the rule of law is weakened and those charged with respecting the law instead make their own law as they go.
The case I’m referring to, not surprisingly, involved a company suing Google for patent infringement. We can expect to see more of this kind of thing, big companies with influence getting off free when infringing the patents of smaller companies (especially if they can be called “trolls”). For details, see Jeff Wild’s article, ” IP/Engine v Google, AOL et al – the most troubling patent case of 2014” in the IAM Magazine Blog, Dec. 22, 2014. This case involving the company Vringo deserves careful scrutiny (and howls of outrage).
Sometimes revolutions are necessary for the good of mankind, but many turn out to be excuses for someone to seize power, loot innocents, and create chaos. Until the US returns more fully to the rule of law in the IP arena and strengthens its laws to respect IP, especially for small companies and innovators who need an equalizer when facing Goliaths (or Google-liaths), we will face ongoing chaos, looting, and innovation fatigue as we reduce incentives and increase risks for the most innovative segments of our society, the small companies and lone inventors who are striving to create the future that giant companies are often to slow or risk averse to pursue.
The US Supreme Court recently ruled that “abstract” concepts are not eligible for patents. The 2014 case, Alice Corporation Pty. Ltd. v. CLS Bank Intl. or more simply Alice, is said by some to mean the death of thousands of patents if not entire industries. Critics such as Gene Quinn say it is unworkable, vague and indefinite, giving judges and enemies of patents a capricious tool to assault patents for software and other fields. One of the alleged problems with the Supreme Court’s ruling is that they expressly refused to define the word “abstract” because, of course, it is a very difficult word to define precisely for legal purposes. Greg Aharonian has expressed outrage over the “incompetence” of the Supreme Court in failing to even attempt to explain what they mean by “abstract.” IAM Magazine‘s blog warns of “potentially catastrophic effects” of the ruling. Even the calm and collected IP professor, Dennis Couch expresses concern that “there is no standard definition for ‘abstract’ and so it is difficult to identify abstract ideas from non-abstract ideas.” Many other IP experts and patent owners are up in arms because this allegedly adds confusion to patent law and gives judges a broad club to attack patents by merely calling them “abstract.” So much whining!
So how can you know if a claimed invention is “abstract” or not, when claim language invariably requires some degree of abstraction to describe the invention? OK, that’s a fair question, but there’s an easy answer thanks to the visual arts!
With a little artistic understanding, it is easy to predict precisely where the boundaries are for the hard-to-define term “abstract.” This is a case where art comes to the rescue. In my role as both a patent agent and an amateur artist, I can combine my skills to bring a little clarity. Students of art, especially the visual arts, know that artistic expression can capture and define concepts that cannot be precisely rendered by words alone and certainly not legalese.
The eye can often see what the pen cannot express. We should have learned this lesson decades ago in the debate over pornography. As Justice Potter Stewart once said, “I shall not today attempt further to define the kinds of material I understand to be embraced within that shorthand description; and perhaps I could never succeed in intelligibly doing so. But I know it when I see it.” This statement is from Jacobellis v. State of Ohio 378 U.S. 184, 197 (1964) and while decades old, it still applies brilliantly today. With that judicial framework, we can readily see that pornography is equivalent to the abstract in patent law. Yes, you can know it when you see it, and seeing is what we need to do now to understand the keen thinking of the Supreme Court on this topic. So let’s take a look and understand “abstract” based on abstract art, or more specifically, photographic abstracts selected from my own work, including collections of abstract photographic art. I think after a few examples you will better appreciate just where the boundaries are that separate “abstract concepts” from the concrete, tangible concepts suitable for patentable inventions.
Knowing It When You See It: Examples of Abstraction, Illustrated by Photography
Here I present a series of works from my abstract photographic art and discuss the nature of the abstraction.
The abstract above resembles abstract geometric concepts found in many paintings, almost cubist in flavor, but achieved using photography. I snapped a photo of a group of people inside the Wisconsin State Capital in Madison, Wisconsin, but using a slow shutter speed that resulted in blurring of many features. But you can recognize a black man with a baseball cap on the left. In his right hand is an iPod and you can see a white line representing the ear buds he is wearing. On the right side we see the side of a woman with a purse. Of course, while baseball caps, iPods, ear buds, and purses, like people themselves, are relatively tangible objects, in this context they are rendered less specific by the way in which they are captured or described, thereby creating abstraction from that which was initially concrete and specific. Let that be a lesson to patent drafters, by the way!
Here’s another with a related technique:
This abstract is based on the structures and controls of the front panel of a rental car. The camera was moved as I snapped the shot. Not a random mistake, but a deliberate effort to convert the concrete into the abstract by blurring and twisting. Of course, the limitations of language tend to do this to some degree to all inventions, no matter how tangible, as they are “blurred” and captured with the unsteady lens of a single patent claim. A little burring in inevitable, but this much blurring definitely turns the tangible into the abstract.
Now let’s consider abstraction without blurring:
This is a geometrical abstract wherein the elements (abstract circles and lines) from a physical structure dominate the image and create an abstraction. This essentially untouched photo was taken from the entrance of an abandoned shopping mall in Milwaukee, Wisconsin. The scene is drawn from the concrete–or rather, from metal beams, glass, and brick–but when viewed in this way, becomes a combination of abstract elements: circles and lines, rhythm and color. Clearly abstract. The silhouette derived from a remote tree reflected in glass at the bottom is an abstraction representing the intrusion of nature into artificial man-made realms. Don’t let the hint of a tree distract you from the abstract theme here. After all, anything derived a tree is a product of nature and thus unpatentable, according to the Supreme Court in their recent Mayo v. Prometheus decision, which served as a basis for the reasoning in the Alice decision.
Now it’s time for something trickier but still abstract.
This image shows a mirror and a section of translucent plastic roofing above a cable car stop on the way to a tall mountain overlooking Rio de Janeiro. The mirror and the roofing are tangible, distinct objects, as are the buildings in the background. But here the image celebrates the blues and greens in conjunction with arcs and circles. The mirror does not display the photographer, but another section of the building, and is a symbol of the failure to reflect upon one’s self, becoming lost instead in the haze of what we call civilization, even while standing next to a towering temple of nature (the unseen mountain). The mirror also punctuates the series of repeated curves of the roofing, like a grand period putting a stop to the rhythms of the sky, an abstract concept again reflecting the invasive nature of civilization. It’s all very abstract stuff, though individual components are tangible, just as patent claims may contain concrete elements such as servers, computers, and processors, but in the end create an overall impression in the mind of the viewer or judge that is decidedly abstract.
Now I turn to an abstraction that is linked to the whole concept of innovation and IP, the famous light bulb, but here an abstract version thereof.
This photo is little more than an abstract idea representing the concepts of “light emission” and perhaps “bulbs.” It was actually abstracted from a fairly specific and tangible device, a fluorescent light bulb, but with extreme photographic settings and color adjustment that removed much of what is concrete in favor of the abstract. Sure, you can argue that it has components that are somewhat tangible and concrete, but those of us who know the abstract when we see it have no trouble calling it such. It’s not a patent-worthy bulb. It’s just an embodiment of an abstract idea. Patent ineligible. I know it, because I, like any good judge, know it when I see it. Try proving me wrong! Or rather, just try proving a judge or patent examiner wrong when they see something abstract in your carefully claimed invention.
As you can see, the boundaries of “abstract” are surprisingly clear and easy to predict–and surprisingly difficult to evade. I hope this will help all those complainers worried about “uncertainty” from the Alice decision to appreciate the new kind of certainty that it gives. Good luck to all you inventors and small companies out there. May your patents be less abstract and more valuable in the future.
Originally posted at JeffLindsay.com as “Abstract Art to the Rescue of Abstract Patent Law: How to Know “Abstract” When You See It.”
The recent Alice decision from the Supreme Court threatens patents for many innovators working with computers, software, information, and knowledge–in short, the heart of the modern Knowledge Economy. By waving around the undefined word “abstract”–a word that the Court expressly refused to define–they have ruled that a major part of the economy is simply not eligible for patent protection. An article at the popular IP blog, PatentlyO, seeks to explain if not justify the Court’s ruling. In “Alice, Artifice, and Action,” Jason Rantanen elucidates the thinking of the Court as he explains that the problem with the invention in Alice is that ultimately, what it involved “is just information” and thus intangible or abstract, unworthy of patent protection. I recognize this is a widely held belief, but it is not based on modern science. Maybe superstition, but not science.
It’s time for those in the IP profession to recognize what many scientists and engineers have long understood: that information is physical. Just as e=mc^2 helps us understand the relationship between matter and energy, the laws of thermodynamics plus a good deal of modern quantum mechanics and other fields helps us understand the physical relationships between information, matter, and energy. Entropy is one of the key physical concepts that helps us appreciate that linkage. See Wikipedia’s article on this topic at http://en.wikipedia.org/wiki/Entropy_in_thermodynamics_and_information_theory.
Information cannot be processed without physical, material change often affecting more than just physical entropy alone. That information processing may be in the form of electronic signals, computer chips, magnetic media, graphical interfaces, or chemical reactions with DNA (DNA, of course, is “just information” encoded with a brilliantly simple and tangible system).
In the Industrial Age, we focused on inventions made with cogs and pistons, steel and glass–crude, weighty, and easy to touch or see. Their making and their use involved smoke and flame, clangs and whirrings that nobody could miss. But we have moved into the the Information Age, where the greatest innovations that will drive our economy, the Knowledge Economy, are much finer, often microscopic, involving silent, invisible (to the naked eye) change that is still every bit as physical and real as anything a blacksmith hammered out. To dismiss the workings of the new electronic machines of our day and their many fruits as mere abstractions, intangible, immaterial, the whisps of ethereal spirit devoid of substance, is to miss the reality of the greatest era of innovation and invention ever. To exclude inventions in handling information as inherently unpatentable is a tragic error, one that contributes concretely to the growing innovation fatigue in the U.S.