Companies Asked to Donate Unused Patents

Radon360 writes "There are countless patents that are promising but sitting idle, stowed in the corporate file room. In fact, about 90 percent to 95 percent of all patents are idle. Countless patents sit unused when companies decide not to develop them into products. Now, not-for-profit groups and state governments are asking companies to donate dormant patents so they can be passed to local entrepreneurs who try to build businesses out of them. "

Why donate?

[mapkinase]

If companies would be interested in doing something with the patents they could have enter sharing agreements with anybody willing, so they would split the money between the owner of the patent and the entity that actually does the work of implementing the patent.

Tax break for donating patents

[Anonymous Coward]

Perhaps giving companies a tax writeoff equal to the amount in revenues that a donated patent generates would work out.

Invalidate them

[simm1701]

Wouldn't it be a lot simpler to make patents only valid while the holder is actively exploiting them (ie using them to build the device in question - filing suits against anyone that looks like they might be using it shouldn't count) - allow a 3 year grace period between filing the patent and when they first start using it to cover developement to market window

Absolutely

[zappepcs]

This is part of the patent system that is broken. There is no incentive to not squat on the patent and wait for someone else to do the work. Invalidating the unused patents and passing them to the public domain will increase (IMO) the ability of small and agile businesses to do something with the previously patented item. When it passes to public domain, it removes the ability of anyone to use it just for suing others.

If the patent is not being used, it doesn't need patent protection! The grace period length may be up for debate, but the idea of passing the invention to public domain should not be in the case of unused patents.

Re:Invalidate them

[FredDC]

Unfortunately it's not that simple I'm afraid...
 
The time between patent filing and product on market is not the only criteria you would need to check. There could be many reasons why a patent is still valid, and because of the tremendous amount of patents applied for and (maybe not yet) given the work involved would be too great to deal with. It's simply not feasible to apply such a check to all patents within a reasonable timeframe. You would never be able to do only a part because the patent holders that are damaged would cry murder over the fact that they were targetted and others not...
 
The entire patent system as it is in the US is rotten to the core. I'd rather see the way patents are handed out change first before taking a look at existing ones. What's the point of evaluating crappy patents when you are handing new crappy ones out every day...

Perpetual auction for patents: taxing horders

[G4from128k]

I've often wondered whether patents could be subject to a type of perpetual public auction in which anyone can make a binding bid on a patent. The price on the patent would be part of a delayed mark-to-market capital gains tax accounting system that would encourage companies to either monetize or sell patents because they would be paying taxes on those patents. Some small entrepreneurs might be "forced" to sell their patents (i.e., they owe the IRS $2,000,000 because they got a bid for $10,000,000), but then they'd get far more money from the high bidder than they could have if they kept the patent. High bidders would, in turn, have serious skin in the game and want to make money from the patent. Patent-horders would need to pay the gains taxes on their patent portfolios as if those patents where being economically used. I suspect the scheme would make it more costly to keep frivolous patents or to sit on a patent to prevent competitive innovation.

Re:Invalidate them

[the eric conspiracy]

Doh! The USPTO already has a mechanism for this - maintainence fees. If you don't pony up $$$$$$ every few years the patent automatically expires. Companies, being greedy bastards don't maintain patents that they have no interest in. Which is probnably why this entire article and discussion thereof is stupid.

No patents go unused

[argoff]

The whole goal of filing tons of patents you won't develop is to wait for someone else to do the work for you.

In truth, the stealth patent strategy is only used by a tiny minority of vultures. The vast magority of companies (eg. IBM,HP) use them to get into cross-licence agreements, or use them as ammunition to defend against lawsuits. In the industry, patents are almost never used to "protect" invenstions, but only to protect against lawsuits. So in that way, no patent goes unused.

Re:Why donate?

[Kaboom13]

This seems like a perfect argument for making large patent portfolios cost a lot of money to keep. Perhaps a system where you get 1-2 years free then increasingly large fees after that to keep your patent. Of course, the problem would be to find value for the fees that would be affordable for small busninesses while still giving an incentive to large businesses to abandon/sell unused patents. The money could even be put into examining new patents more carefully. Of course thats how a working system would work, sadly as long as the average voter (and your average congressmen for that matter) don't know the difference between a patent and copyright there is little incentive to change a system that rewards the big players so much.

Re:Practical Case

[asphaltjesus]

http://www.theautochannel.com/news/2005/02/25/0053 98.html [theautochannel.com]

That's the guy who came up with intermittent windshield wipers. The specifics of which, I have issue with, but the basic principal is sound.

I'm an inventor who comes up with a great idea. I patent it, then I shop it to companies who would likely use it to gain an advantage. The company can examine the novel idea in detail and the inventor is protected from wholesale theft and place a value on the idea. If the inventor and business agree on some terms, then both parties benefit.

The process is hampered by human organization mantras like "not invented here." At this point in time, the whole patent process is completely out of control so any semblance to the original notions are a long way gone.

Hurts only the good guys

[asninn]

That seems like a bad idea to me, for a very simple reason.

Think about it: companies are, first and foremost, interested in making money. Some may have ethical goals or values, too (let's call these "the good guys"), while others don't and care ONLY about money (the "bad guys"). Now, what kind of company would donate a patent they held?

Obviously, the bad guys wouldn't do it; after all, a patent, even if you're not using it right now and have no current plans to do so in the future, might still be valuable at some point, and giving up that value for nothing is a bad deal. The good guys, on the other hand, might do it - depending, of course, but in principle, they might.

If a patent gets donated, what happens? Either someone picks it up and creates a successful business, or it turns out to be a dud. In the latter case, the whole act of donating it was pretty useless, but since that's not what's supposed to happen, let's concentrate on the first case: here, someone actually demonstrates that there WAS more than just a theoretical value attached to the patent, so the company that donated it did lose REAL money when it did so.

Now think about that: the bad guys (who didn't donate anything) continued as usual, and the good guys, *by virtue of being good guys*, *lost money*. Therefore, this scheme is either useless (if the donated patents aren't useful for creating new businesses) or hurts the good guys and rewards the greedy.