The Role of Patents and the Need for Patent Reform

Contrary to what most people assume, a patent does not give the owner of the patent the right to use the patented invention. In fact, the exact opposite is true! A patent gives the owner of the patent the right to exclude others from making, using, selling or offering for sale a product or service that uses the patented invention. Patent owners typically charge a royalty to businesses that use (or “practice”) the patented invention and this arrangement as known as “licensing.”

What makes a patent useful to society is that it is available to the public. Today, access to patents is easier than ever thanks to the Internet, but prior to the on-line access we have today, the Department of Commerce set up Patent Libraries across the U.S. These Patent Libraries included Search Indices so people could locate patents that applied to certain technologies or applications.

NPEs (or non-practicing entities) are those patentees that do not have a factory in which they can produce a product that uses their patented invention. NPE’s consist of universities, independent inventors, small businesses and technology licensing companies. Unfortunately, patent trolls are marginally in this group, and they are the bad apples that have created a call for patent reform legislation that will actually weaken the U.S. patent system. For the legitimate and responsible patentees – such as universities, inventors, small businesses and technology licensing companies – the only recourse it has when its patent as been infringed is to file a patent infringement lawsuit.

Making patents available to the public enables each generation of inventor and innovator to build on the last generation of patents. The weakness of this same system, however, is that it makes patent infringement relatively easy. A business can easily use an inventor’s patent, and it is up to the patent owner to locate and identify the patent infringers. Patent infringement is not a crime, so there are no “Patent Police.” It is up to the patent owner to pursue justice and compensation for infringement of his (or her or its) patent through civil litigation.

As a result, genuine patent reform must include strengthening the patent system by building in protection for patent owners. Real patent reform should also include making sure that patent owners are properly compensated by the infringers when patent infringement occurs. And patent reform should include making sure that the actual discoverers of inventions receive patents for them.

Unfortunately, the Innovation Act (H.R. 9) that is currently before Congress has nothing to do with “innovation” and everything to do with restricting the ability of patent holders to enforce their intellectual patent rights. Written by lobbyists for the large, high-tech corporations that are the most blatant infringers of patents, the Innovation Act, if enacted into law, will make it more expensive and riskier for patentees to assert their intellectual patent rights.

The America Invents Act, enacted into law in 2011, also has nothing to do with inventing, inventors or innovation. Neither the America Invents Act nor the Innovation Act include what would be genuine reform of the U.S. Patent System: Fully funding the Patent Office, establishing a multi-tier, 21st Century patent system, or reducing the patent application backload.

To learn what you can do to promote REAL patent reform, contact our Executive Director, Alec Schibanoff.