Software Patent Reform Stalls Thanks To IBM and Microsoft Lobbying

An anonymous reader writes "The Washington post reports on the progress of a piece of legislation many hoped would address the glut of meaningless software patents used as weapons by patent trolls. Unfortunately, the provision that would have helped the USPTO nix these patents has been nixed itself. The article credits IBM, Microsoft, and other companies with huge patent portfolios for the change, citing an 'aggressive lobbying campaign' that apparently succeeded. Quoting: 'A September letter signed by IBM, Microsoft and several dozen other firms made the case against expanding the program. The proposal, they wrote, "could harm U.S. innovators by unnecessarily undermining the rights of patent holders. Subjecting data processing patents to the CBM program would create uncertainty and risk that discourage investment in any number of fields where we should be trying to spur continued innovation." ... Last week, IBM escalated its campaign against expanding the CBM program. An IBM spokesman told Politico, "While we support what Mr. Goodlatte's trying to do on trolls, if the CBM is included, we'd be forced to oppose the bill." Insiders say the campaign against the CBM provisions of the Goodlatte bill has succeeded. The House Judiciary Committee is scheduled to hold a markup of the legislation Wednesday, and Goodlatte will introduce a "manager's amendment" to remove the CBM language from his own bill. IBM hailed that change in a Monday letter to Goodlatte.'"

Is that the same Washington Post ...

[Anonymous Coward]

... that's owned by Jeff "One Click" Bezos?

For those who are interested

[sconeu]

CBM means "Covered Business Method (patent)"

Re:Money again...

[Anonymous Coward]

If money is equal to speech then guess who as more speech than you.

Now now, all Americans are equal. Some are just more equal than others

What "obvious" means.

[Animats]

1. Fix "obviousness."

Unfortunately, I think you're asking someone to prove a logical negative: the applicant has to prove that something isn't obvious by showing... what, exactly?

I hold six patents, and a few times I've had to prove obviousness to an examiner. The gold standard of obviousness is showing that others tried hard to solve the problem and failed. Sometimes, on problems where others have beaten their heads against the wall and there are failed products and projects in the field, you can point the examiner at prior art which shows obviousness. I was the first person to build a ragdoll physics system which could handle the hard cases. Back in the 1990s, early ragdoll systems tended to have characters flying off in random directions, sometimes with the body parts detaching. (Some physics engines still do that, which is lame, because, fifteen years later, several solutions besides mine are known now.) By pointing to previous failures that extended up to and past my patent application date, I was able to demonstrate non-obviousness.

"Obvious" does not mean "obvious in hindsight".

Why there are patent trolls

[Animats]

The patent troll industry exists because, in the last decade, it's become much tougher for inventors to enforce patent rights. Four changes in law did this:

• (2006) "eBay v. MercExchange " The patent holder can't get an injunction against infringement any more, except in extreme cases. This destroyed the concept of a patent as property that only the patent holder could use.
• (2007) "In re Seagate" The patent holder can't get triple damages unless there is "reckless infringement", which means the worst that can happen to an infringer is that they have to pay a royalty, the same royalty they might have negotiated. So infringement by a big company is risk-free.
• (2007) MedImmune, Inc. v. Genentech, Inc. If a patent holder writes to an infringer asking them to pay royalties, they can be sued for a judgement that the patent is invalid, in a court of the infringer's choosing. So, as a patent holder, you have to file suit before you can negotiate. This is why "patent trolling" became necessary.
• (2011) The "America Invents Act" The "America Invents Act" added "post-grant opposition" proceedings, so now infringers can harass patent owners and stall infringement claims in multiple forums. Note that one of the "features" of HR 3309 is to limit estoppel so that similar issues can be raised once in a post-grant opposition and then re-raised in an infringement case. This makes it clear it's all about raising the cost of enforcing a patent by wearing down the patent holder.

Because of those changes, enforcing a single patent is no longer financially feasible in most cases. A big patent portfolio is needed. You either have to be a big patent holder like IBM or Google, or you have to deal with a company that aggregates patents to monetize them. This created the "patent troll" industry.

HR 3309 is an anti-inventor act, designed to make it more expensive to enforce a patent. After the removal of the "covered business method" patent section, patents are as strong as ever. You just have to be richer to enforce them. That's why this is supported by Google, Facebook, etc.

The current Senate bill on patent trolls, S.1720, the "Patent Transparency and Improvements Act of 2013" is much more narrowly focused than HR 3309. It has most of the anti-trolling provisions, but not loser-pays fee shifting. (Loser-pays means if a little guy sues a big company, they can get stuck with the big guy's big-law legal bills. That's a killer.) Instead, S.1720 has a study for a patent small claims court for small patent cases to get litigation costs down. That could work.