Thanks to Jim Moore‘s example, Tom Stites and I have been exercised recently about “Patent Reform” or, more exactly, Patent Deform as Stephen Wren put it. It turns out that the proponents of the legislation are most of the tech industry which, having been caught as serial infringers by the courts, has proposed the single most probable method for gutting American innovation.
As I mentioned before, America is arguably the world’s innovation leader and we are also the only country with the “First-to-Invent” doctrine: An American inventor is protected who is good at putting inventions into the real world but not so good at filing patent applications. And our patent law provides significant penalties when a company infringes on such patents, whether filed or not.
But the Big Tech Big Ten companies don’t like that so much:
We can understand their point. Earlier this year, Microsoft was awarded $1.5 billion for infringing on a patent by the holder, Alcatel-Lucent.
Oops: late-breaking news from last week. A judge disagreed with the jury and overturned the verdict. Could the patent laws be working? Apparently not if you’re forced to defend your actions.
From that viewpoint, the Patent Laws are broken, because Microsoft simply should not have to go to so much trouble to explain itself. Partly because of stock buybacks, their cash reserves dropped below $30 billion late last year for the first time since 2000.
Here’s a graph of the tough times that the Big Tech proponents of Patent Deformation have suffered over the last 5 years, as indicated by their aggregate share value:
Well, 3 years in Google’s case.
So, all this reform turmoil is being driven by the legal teams of the Big Ten Big Tech companies, while it’s adamantly opposed by other, less glamorous companies like Caterpillar, Proctor & Gamble, QualComm, and about 230 other companies and Inventors’ associations. I’ll try to find that list for you.
Time to Leave the Whine Country?
Maybe The Big Tech Big Ten Patent Deformers need to learn that business won’t always be as easy as it was in the early days. Meanwhile, here’s another graphic for them to live by: