2007 Patent Reform - It's Off To An Ugly Start . . .

The U.S. House of Representatives Committee on the Judiciary is organizing the Subcommittee on Courts, the Internet, and Intellectual Property for oversight hearings this Thursday (2:00 PM) on patent reform.

The title of the hearings pretty much says it all: "American Innovation at Risk: 'The Case for Patent Reform.'” The current list of witnesses, and their linked testimony, includes:

• Adam B. Jaffe, Professor of Economics and Dean of Arts and Sciences, Brandeis University Whaltham, Massachusetts (view prepared testimony here)
• Suzanne Michel, Chief Intellectual Property Counsel and the Deputy Assistant Director for Policy Coordination Federal Trade Commission Washington, D.C. (view prepared testimony here)
• Mark Myers, Co-Chair of the National Academy of Sciences Report Patent System for 21st Century Unionville, Pennsylvania (view prepared testimony here)
• Daniel B. Ravicher, Executive Director Public Patent Foundation New York, NY (view prepared testimony here)

The testimony of Myers and Michel lay out the conventional case for patent reform: quality issues at the PTO create uncertainty, trolling litigation exploits the uncertainty, and the lack of challenge mechanisms on validity propagate the uncertainty. Thus, the following reform measures were highlighted

1. increase scrutiny (i.e., "second pair of eyes") and funding for PTO examination;
2. provide post-grant opposition to challenge questionable patents;
3. tighten standards on obviousness and willfulness; and
4. provide safe havens for prior user rights and research exemptions.

One interesting note on Suzanne's testimony is that she resurrected the "preponderance of the evidence" standard for invalidity which was recently recommended in the FTC's 2002 report on patent policy. Other than noting this recommendation, Suzanne didn't pursue this further in the testimony.

The testimony of Jaffe and Ravicher, however, is another matter. With all due respect, it's just over the top. Some of the testimony is inaccurate and misleading (the USPTO has an 85% allowance rate? Really?) some of it is simply untrue ("through a quota system, patent examiners are given more credit, and evaluated more favorably, if they issue, rather than reject patents"), and some of it is just bizarre. Take this, for example, when Ravicher compares bad patents to condemned prisoners on death row:

[l]itigated patents tend to have a much greater significance to the public, on average, than non litigated patents. To draw an analogy, if 35% of the people on death row who challenged their convictions were actually proven innocent, that wouldn't necessarily mean that 35% of all people on death row, much less 35% of all convicted criminals, were actually innocent (that ratio could be higher or lower), but the severity of each mistake regarding someone on death row is extreme nonetheless. Similarly, the technology involved with litigated patents is almost without exception extremely valuable, so any mistakes regarding the validity of those patents can cause severe harm in and of itself, regardless of the validity rate of issued patents in general.

Of course, the call for banning software and business method patents is urgently argued, as well as reducing wilfull infringement strictly to cases where direct copying is proven. In short, the patent world, according to Jaffe and Ravicher, is populated with good guys and bad guys - and the bad guys are people who dare to exclude others, who purport to have good intentions, from technological advancements.

This is not to say that their testimony is wholly without merit, because they do make a few valid points. However, the rhetoric is simply too much, and frankly, is getting a little old.