Patent-Busters Take Aim at Congress

October 22, 2004

By Sean Kellogg, Editor-at-Large
As the American economy continues its transition from industrial powerhouse to information juggernaut there has been a marked increase in reliance upon intellectual property protection. Whether in the form of international agreement such as the WTO's Trade-Related Aspects of Intellectual Property Rights (TRIPS) or national statutes like the Digital Millennium Copyright Act (DMCA), the law is in a state of flux as its adapts to the new international realities and global connectivity. The Patent Act, last substantially enacted in 1954, has been largely absent from such reform. Now though, we're beginning to see patent abuse of the type never envisioned by Congress.
Enter the Electronic Fronter Foundation's Patent Busting Project. Both a legal tool and a media stunt, the Patent Busting Project proposes to go after the "10 Most Wanted" for "Crimes against the Public Domain, Willful Ignorance of Prior Art, and Egregious Display of Obviousness." The EFF has assembled a list of issued patents which it believes should have been rejected by the United States Patent & Trademarks Office (USPTO). Some of the more notable patents: Clear Channel's patent on a system and method of creating digital recordings of live performances, Test.com's method for administering tests, lessons, and assessments over the internet, and Acacia Research's patent on audio and video receiving and transmission system.

While each targeted patent has its own particular history, the EFF believes these are textbook examples of obvious inventions, taken from the public domain with the intent to obtain exclusivity rights. Congress has enacted a number of statutory provisions to ensure that only inventors who show true ingenuity and contribute back to the usefull arts deserve a patent. Granting these "inventions" a patent is directly counter to the important incentive plan embodied by the Patent Act.
The EFF has proposed a two stage attack. First, they intend to identify the worst offending patents, document the prior art that shows their invalidity, and chronicle the negative impact they have had on online publishers and innovators. The project is still in this first phase. Following that research effort, the EFF will begin filing challenges in the form of re-examination requests with the USPTO with the immediate goal of invalidating many, if not all, of the identified patents. In the long term, the EFF hopes to draw attention to proposed patent reforms currently going nowhere in Congress.
The first set of patent reforms comes from the Federal Trade Commission (FTC). Creating a new administrative procedure that will make it easier for firms to challenge a patent's validity at the USPTO and allowing courts to find patents invalid based on a preponderance of the evidence, without having to find clear and convincing evidence, are just some of the more interesting recommendations found in the ten legislative and policy proposals. The FTC's report makes clear its belief that while patents can be a good for society, patents must be properly balanced against competition.
The second proposal comes from The National Academies, which encompasses the National Academy of Sciences, National Academy of Engineering, National Academy of Medicine, and the National Research Council. Much of their proposal focuses on the lack of funding currently available to the USPTO. With approximately 300,000 patent applications each year and a steady growth rate without any signs of leveling off, the USPTO has been buried in applications and forced to give less time to ensuring that patents are properly issued, instead relying on private suits to invalidate improper patents. This system has made industry entry for small businesses, who lack the necessary funds to fight a successful patent infringement suit, nearly impossible. The report also suggested a new challenging system (similar to the one proposed by the FTC), an exemption for university academic use (recently ruled as an infringement by in Madey v. Duke University, 307 R.3d 1351 (Fed. Cir. 2002)), rigorous enforcement of the non-obvious standard (see patents listed above), and an examination into possible patent differentiation. Currently, all patents, regardless of industry or application, extend for 20 years after filing. A patent of only 5 years, however, may produce the necessary market incentives for innovation.
The EFF's Patent Busting project aims to put the issue on the front page of business sections and generate interest in reexamining our outdated patent system once the next session of Congress convenes.