Crowdsourcing the Prior Art Search Process

Searching for better ways to find relevant prior art to determine whether a patent is truly novel and nonobvious has been a constant challenge, both for the PTO when examining patent applications and for courts in patent litigation. Simply searching through databases of patents and relevant literature captures only a portion of the available prior art that may be relevant. Sometimes, the most relevant prior art is tucked away in a library somewhere, or an uncatalogued journal, clearly published but not easily found. Only a handful of experts may know of its existence. Unless that art is found, many patents that do not teach novel or nonobvious inventions will be issued by the PTO and validated in court . The problem, of course, is connecting those who are looking for such art with those who might know, or motivating experts to come forward with relevant art.

Efforts to solve this collective action problem have been successfully solved in certain contexts, such as open source software development communities or peer-produced website references such as Wikipedia. The PTO’s Peer-to-Patent pilot is probably the best known attempt to apply crowdsourcing techniques to prior art searches and examinations. Private non-profits and businesses have engaged in similar  crowdsourcing and peer production efforts.

Article One Partners applies crowdsourcing as a business model- offering an award for the best prior art submitted by selef-selected participants. It was started by Chery Milone, who worked with BountyQuest in 1998, an earlier iteration. Article One offers rewards to self-identified experts who find what they deem to be the best prior art. To start building a community engaged in finding prior art, theyoffered bounties to invalidate patents that aren’t necessarily requested by third parties.  They have reported successful prior art searches for litigants as well.

The Electronic Frontier Foundation launched its Patent Busting Project in 2004, aimed at what it calls “bogus software patents”. It is currently targeting Volomedia’s podcasting patent, which I described earlier here.

EFF solicited nominations for the what it views were the 10 worst patents, and it began reexaminations of them.  The project has led to the rejection of several patents, such as the PTO’s rejection in reexam of Hoshiko’s internet subdomain patent, or in the case of Neomedia’s database access patent, a re-issuing that the EFFargues has narrowed the claims. Neomedia’s counsel has responded that the patent has been strengthened, and that additional limitations added to clarify the invention have no practical impact on the patent’s coverage.

President Obama Criticizes U.S. PTO

President Obama criticized the USPTO’s patent filing system, stating that the average processing time is so high in part because of outdated technology. As an example, he cited nonsensical practices such as taking electronically filed applications, printing them, scanning them, and then entering them into the case management system.

“Believe it or not, in our patent office — now, this is embarrassing — this is an institution responsible for protecting and promoting innovation — our patent office receives more than 80 percent of patent applications electronically, then manually prints them out, scans them, and enters them into an outdated case management system,” Obama said a today’s Forum on Modernizing Government.”

IP Watchdog notes that while this was once true, in 2006 a new system was installed and electronically filed applications are no longer printed and then scanned.

Regardless, it is not clear how this particular process is responsible for the backlog, though it couldn’t have helped.  The USPTO could probably benefit from an increase in technological resources, and not coincidentally the USPTO is seeking more funding in the budget.

Patent Reform Continues Slog Through Committee

EETimes reports that an organization of universities sent a letter to White House expressing concerns on patent reform legislation pending in Congress.  The patent reform act has been tied up in committee, though, according to the article, a vote in the full senate is expected thil.

Meanwhile, Robert C. Pozen’s unremarkable call for a patent reform act to be passed without addressing the controversial issue of damages drew a response from Senators Leahy and Session, Chairman and ranking members of the Senate Judiciary committee, who noted that the committee sidestepped the damages debate with compromise language brokered by Senators Feinstein and Spector, discussed in this blog here .

Microsoft Requests En Banc Ruling on Presumption of Validity

The recent Federal Circuit decision Lucent v. Gateway is most notable for the Federal Circuit’s treatment of the entire market value rule and other damages issues, vacating the jury’s damages award but affirming the verdict on issues of infringement and invalidity.  Microsoft has just filed a petition for an en banc ruling on whether there should be  a presumption of validity for patents under prior art that was never before the PTO, and therefore whether such  the clear and convincing evidence standard should apply.   The Lucent v. Gateway case is in a particularly useful posture for this inquiry because the claims of the asserted patent were rejected by the PTO in a parallel reexamination proceeding.  Unlike in litigation, the PTO does not accord a presumption of validity when examining the validity of claims under prior art not previously submitted.  Instead of the clear and convincing evidence standard, the PTO determines validity under the lower  preponderance of the evidence standard, the standard Microsoft submits should be adopted in federal litigation when dealing with prior art that was never before the PTO.  The Federal Cicuit’s panel ruling affirmed the jury’s verdict applying the clear and convincing evidence standard and did not address the issue of which standard to apply.

Inventive Step has made posted the en banc request here.

Microsoft argues that prior to the creation of the Federal Circuit several circuits applied the lower standard for art not that was never before the PTO, and thus the rule is one created by the Federal Circuit that should no longer apply under the Supreme Court’s KSR v. Teleflex ruling.  The Court in KSR stated that “the rationale underlying the presumption [of validity]-that the PTO, in its expertise, has approved the claim-seems much diminished where the claim of obviousness is based on prior art that was never before the PTO,” (550 U.S.at 426) giving rise to speculation that the presumption may no longer apply in such situations.

In Re Bilski Amicus Brief by Legal OnRamp

Legal OnRamp, an online social networking cite for lawyers, has filed a friend-of-the-court amicus brief in the Bilski case. The brief, which is not on behalf of either party, argues that the Federal Circuit decision should be affirmed, though on different grounds. Legal OnRamp argues that the U.S. Supreme Court should affirm the judgment and preclude pure business methods from patentability, but that the machine-or-transformaiton test is unduly restrictive and provides little guidance to the courts and the industry as to what is patentable subject matter.

Legal OnRamp Amicus Brief

Podcasting patent

Chris O’Brien of the San Jose Mercury writes about Murgesh Navar, whose company Volomedia has come under fire for obtaining a patent on “episodic media”, which Navar interprets as applying to podcasting- companies post media files on a website, which people can subscribe to via a client for regular downloading.  The podcasting community was up in arms over the award of a patent that many feels patented technology that has been in use for years, and O’Brien suggests that the podcasting patent reveals the flaws in the  U.S. patent system.

O’Brien: Podcasting patent reveals problems in system.

PTO Director Nominated

President Obama nominated David Kappos for Director of the PTO, an IBM Vice President who was also its Assistant General Counsel, Intellectual Property Law. Bloggers have generally expressed approval, including Patently-O .

eWeek reports that Kappos supports the current patent reform proposal pending in congress, though he was providing testimony on behalf of IBM, not necessarily himself.

Free the Market! – An Intriguing Look at Antitrust Law

Gary l. Reback, has written an excellent book on contemporary antitrust litigation, Free the Market!.  Reback is an antitrust litigator who has worked on several high profile antitrust cases involving Silicon Valley technology giants, including Microsoft, Apple, and Oracle.  Free the Market! is not limited to IT, however, as it surveys industries as diverse as retail toys sales, women’s handbags,  and telecommunications.  Reback criticizes the “Chicago School” of antitrust analysis, which counsels against active antitrust enforcement by the federal government in favor of allowing the market to determine the appropriate levels of concentration in a given industry absent exceptional circumstances. According to Reback, the Chicago school’s approach has held sway at the Antitrust Division of the Justice Department and the federal judiciary, to the detriment of consumers and technological innovation.

Reback’s critique extends to the patent system, making the familiar argument that the U.S. patent system has impeded innovation by creating patent thickets for innovative technology companies.  He relates teh strey of Nathan Myrvold, the former Microsoft CTO who attained notoriety by saying that Microsoft wanted to charge a royalty on every internet transaction that needed to use Microsoft technology.  Myrhvold later formed Intellectual Ventures, a patent licensing company pursuing  similar royalty generating business model.  Reback notes the patent thicket problem and declares that the patent reform system needs to be reformed, but does not drill down into the types of reforms that would preserve patentees’ rights to protect valid intellectual property without creating the thickets that hurt small businesses.

Nonetheless, Reback’s book is a compelling narrative of antitrust cases that raises important issues in both antitrust and intellectual property law.

Grove Discusses Patents at Inventors Hall of Fame Conference

Andy Grove, former co-founder of Intel, spoke at a National  Inventor’s Hall of Fame event on May 2, 2009, and made some interesting comments about U.S. Patent Law.

See Grove Says Patent System May Have Same Flaws as Derivatives.

Grove makes the point that the modern patent regime fosters a disconnect between the actual research and development companies engage in to create new products, and the patents that are issued by the PTO. Rather then issuing patents that flow from actual product design and manufacture, obtained to help a company preserve its competitive advantage in the marketplace, patents are issued and then scooped up by companies that monetizing them through licensing and litigation. He argues that this creates a speculative market in patents that are as unrelated to actual economic production as derivative are to actual investment.

The comparison is interesting, though it surely breaks down on a closer look.  I don’t think anyone sees a market for patents that could lead to an overleveraged speculative bubble. However, the disconnect between R&D and patents should be explored more. Part of the quid pro quo of the patent system is that in return for a limited monopoly on the patent, the public receives a full and public disclosure of the patentees’ invention, ultimately adding to the world’s store of knowledge. Does this actually work out for the majority of patents that are issue, or even litigated?

Compulsory Licensing of Non-Practicing Patentees after eBay v. MercExchange

I have an article in the Virginia Journal and Law and Technology examining the regime of compulsory licensing for patentees who do not commercialize their patents in the aftermath of the U.S. Supreme Court’ 2006 decision eBay Inc. v. MercExchange, L.L.C.

See Compulsory Licensing of Non-Practicing Patentees after eBay v. MercExchange.

As is well known, eBay ended the Federal Circuit’s practice of automatically granting permanent injunctions for patent infringement, after which non-practicing patentees are less likely to obtain injunctive relief.  The article examines the Second Circuit’s approach of denying injunctions to non-practicing patentees, which was a counterpoint to many Federal Circuit cases’ approach prior to eBay, denying injunctions and awarding a compulsory license equal to a “reasonably royalty” for a license to the patent.  That approach has been re-invigorated by Justice Kennedy’s concurrence in eBay and subsequent U.S. District Court cases.