Judge Posner, the cost of invention, and software patents


Hon. Posner, the Judge who recently questioned whether patents should cover software in a Reuters interview, recently authored an article for The Atlantic on the very same topic. Once again he voiced his concern about software patents and the patent system as a whole. Compared to the Reuters interview, the Judge’s opinion, assumingly written in his own hand, comes across less radical absolute then previously.

If you read my previous article on the subject, you may be surprised to learn that I agree more than disagree with him after reading The Altlantic piece. However, I still hate it when people compare the world of mobile phones to the pharmaceutical industry for the purposes of framing a patent argument. At one point in my life I was working for a managed care pharmacy organization as the Director of IT.This provided me a unique perspective of both the pharmaceutical and technology market places. Once again, Judge Posner uses the pharmaceutical industry as the “poster child” for why an industry needs patent protection. He says, “..few industries resemble pharmaceuticals…”. If we are comparing research, development, marketing, project management, etc, between the pharmaceutical and technology industry – I disagree. They are very similar. If we are talking the amount of dollars needed to bring a single product to market, then I am in concurrence. However, that should not by itself be used in the valuation of a product. Both industries do not have the same path to market. Qualcomm’s patented CDMA technology != Viagra.

Hon. Posner even acknowledges that the real issue for drug manufacturers seems to be the expense associated with complying with government mandated regulations. Yet Hon. Posner says, “I would lay particular stress on the cost of invention“. He suggests that the pharmaceutical industry, simply because it costs so much to bring a product to market, should benefit from patent protection almost unquestionably. That stance is simply unfair and discriminatory. It also flies against conventionally accepted global wisdom that anything which makes a non-obvious “technical contribution” or solves a “technical problem in a non-obvious way” is patentable. This includes – and legally applies to – a computer program. Contrary to some feedback I received from my first article, Europe and Asia do grant software patents.

Judge Posner and I concede that a major contributing problem in the US is the overburdened USPTO, the amount of patent submissions, and lack of technically educated inspectors and decision makers. Too many “common-sense” or non-obvious technical contribution software patents are being granted. Some readers were quick to comment on my last article that the EU and Japanese patent system are superior to the one in the U.S. The justification for that sentiment was the opinion that they (the EU and Japan) only award patents for, as one reader put it, “truly innovative products”. To quote a Forbes article on the topic, “The same patent wars, which led Google to buy Motorola Mobility are raging on in Europe.” The UK high courts just negated an Apple touch event patent as lacking technical contribution. The same case is now in front of the German courts and Apple will probably lose there too.

I also do not understand the argument he makes that if a team of engineers, being paid a salary to conduct R&D, improve or discover something new that the cost of that innovation may be small to a company operating within the technology industry. Again, I ask why the monetary investment of the product matters in determining if something can be protected via a patent? What were Larry Page and Sergey Brin being paid as PhD students at Standford for their research project when they created the PageRank system? How much is Google worth today in large part because of that founding algorithm? Intellectual property should be protected and allowed to be patented regardless if it cost $5.00 to create or $100,000,000.00 or if it is a drug or software – as long as it meets the legal definition of intellectual property. If the software solves a non-obvious technical problem then it should be allowed to be patented and protected. If the software simply allows me to unlock my phone by sliding my finger across the screen – not so much. It is this tangible versus seemingly non-tangible aspect that people have a hard time wrestling with.

Judge Posner also asserts that evolution in the technology industry would occur anyway as part of the “normal competitive process” without patent protection. Again… how is this different then the pharmaceutical industry? Multiple companies are researching medications with similar therapeutic benefits to address the same ailments. He calls what is happening in the technology industry “patent races”. This is exactly what occurs in the pharmaceutical industry too. The term “first to market” was practically coined if not made part of the lay lexicon by the pharmaceutical industry.

We both agree that there should be different rules for different industries. I am ok with that. Honorable Posner and I find additional common ground on our disdain for patent trolls. It seems very counter intuitive to be holding patent protection for something you do not produce. I was also happy to see Judge Posner state that, “Judges have difficulty understanding modern technology and jurors have even greater difficulty” as that was another criticism I leveled at the Judge.

So there we have it. I never want to state something is a problem or complain about a situation without offering potential remedies. Possible solutions we both suggest and agree on are different lengths of time a patent is valid for different industries, expanding the authority and staff of the USPTO, creating a use or lose clause for certain industries to eliminate trolling and stockpiling, educating those presiding over IP cases where technology is concerned. Judge Posner, I would be more than happy to consult with you on future technology cases. You’ll notice Hon. Posner does NOT suggest abandoning the intellectual property patent protection for software in the most recent article written by himself which was the picture painted in the previous interview.

I am going to end this with a quote from Hon. Posner which is what I believe the point of his recent interviews and articles as well as mine:

“I am not enough of an expert in patent law to come down flatly in favor of any of the reforms that I have listed. I wish merely to emphasize that there appear to be serious problems with our patent system, but almost certainly effective solutions as well, and that both the problems and the possible solutions merit greater attention than they are receiving.”

Feel free to agree or disagree in the comments below and add me to your circles on G+.]]>

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