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Program Could Revolutionize The Patent Office

September 15, 2008

The most powerful players in the technology industry are complaining that the U.S. patent system puts too many patents in the hands of people who can use them to drag inventors and companies to court.

Blaise Mouttet, an inventor in Alexandria, Va., believes he knows why.  He believes that “there are too many lawyers and not enough inventors involved with the patent system.”

So Mouttet is participating in a test program started in June 2007 with the U.S. Patent and Trademark Office. The program, which is backed by the technology industry, is created to give the public more of a voice in the system.

The program, called Peer-to-Patent, is easy to understand.  People publish patent applications on the Internet for everyone to see.  Anyone with related expertise can offer input to be passed on to the Patent Office.

Peer-to-Patent hopes using the power of the Internet will dig up hard-to-find “prior art,” which is evidence that an invention exists, or doesn’t need a patent.

The goal of the program is to drive innovation by improving the patent process and to reduce patent infringement lawsuits that are filling up the courts.

“The Patent and Trademark Office is the agency of citizen creativity, and it needs more and better information to do its job of awarding patents to those citizens who are truly the most creative,” said New York Law School professor Beth Noveck, brainchild of the Peer-to-Patent program. “A patent is a pretty significant monopoly, so we want to make sure we are giving it to the right people.”

Peer-to-Patent, which is in its second year, has attracted financial support from the technology sector.  In its first year, program drew applications from powerful industry players such as Microsoft, Hewlett-Packard, General Electric, and open source pioneer Red Hat.  The program has also attracted many small inventors like Mouttet.

Mouttet, who is a former Patent Office examiner, submitted an application on the electronic uses of nanomaterials.  His original patent was rejected due to prior art found through the Peer-to-Patent program, but has appealed and feels his new patent is stronger for having gone through the process.

Major technology companies have the highest hopes for the new program, mainly because they are the most vocal critics of the existing patent program.

They complain that the Patent Office is overwhelmed by a quick increase in patent applications, particularly in the computing market.  The Patent Office currently has 5,800 specialized examiners, but also has 467,243 applications submitted.  The number is up from 237,045 in 1997.

According to Dave Kappos, vice president of intellectual property law for IBM, technology companies with large patent portfolios are seeing it take longer and longer to get patent applications approved.  The average patent is taking nearly 3 years to be approved, and the patent office has a current backlog of 761,000 applications.

That makes it very tough on a industry built on quick innovation, and short product life cycles said Noveck.  The new Peer-to-Patent program is seeing patents approved as quickly as 7 months.

Poor patent quality is only big concern.

Controversial patents are nothing new.  Recently patents were awarded to Amazon.com for a “1-click” online shopping feature, and one to J.M. Smucker Co. for a crustless peanut-butter-and-jelly sandwich.

Some of the most disputed patents have been seen in the tech sector where software and other technologies are new to the Patent Office.  That means patent examiners are without established databases of existing inventions related to the applications.

“With technology, the prior art often can’t be found in existing patents or academic journal articles,” Noveck said. “It could exist in a string of computer code posted online somewhere that isn’t indexed.”

The result has been substandard patents, which have led to many infringement lawsuits that eat up valuable resources.  In 2006, 2,830 patent lawsuits were filed, up from 1,840 in 1996.

Technology companies are most vulnerable to infringement lawsuits.  Many of their products rely on multiple components that need multiple patents.

A recent case nearly shutdown the BlackBerry wireless e-mail service, and has become a rallying cry for those wanting Congress to overhaul the patent system.

Though many companies are praising the new Peer-to-Patent system, some are not sold on the concept.

Stephen Key, an inventor from California, worries that the program requires applicants to put their work online, making it more possible for others to steal.

Others questions the effectiveness of the program, saying the real factor driving the increase in litigation is not a lack of prior art, but the vague scope of too many patent claims.

“Applicants come in and ask for the sun, moon and stars and they say: ‘Let the Patent Office tell me what is and isn’t patentable,’” said John Doll, U.S. Commissioner for Patents. “It’s a burden on the system.”

According to Mark Lemley, Stanford Law School professor, the challenge facing the Patent Office is to find the balance between awarding patents to encourage innovation, and making it too easy to obtain a patent.

Noveck hopes the Peer-to-Patent program will provide that balance.  The Patent Office has issued decisions on 40 of the 74 applications, and of those, six cited prior art through the program, while eight others citied prior art found by examiners and peer reviewers.

In it’s second year, the program will be scaled to review thousands of applications that extend beyond the technology arena, and many inventors are waiting to see how well the model works.

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