“Whining” Patent Victims

In “The Still-Starved Patent Office,” from the December IP Today, patent attorney Joseph Hosteny argues against PTO “fee diversion” and also takes a few swipes at Patent Reform and victims of patent suits. As noted in Troll Tracker [Why People Hate Lawyers, Hosteny’s patent law firm, Niro, Scavone, is a well-known patent plaintiffs firm, and they do not like being called “patent trolls”, even though Hosteny has written in defense of so-called “patent trolls,” as I note in Patent Trolls and Empirical Thinking. As noted there, I had previously criticized Hosteny’s argument that the patent system is necessary for there to be invention and innovation (a common refrain of the patent bar--surprise). Anyway, in this article, Hosteny says that patents are needed for their to be innovation. He provides no evidence, however, but just quotes a 1921 New York Times editorial, which stated: “Inventions are the main builders of American manufactures. Nine-tenths of our industries have sprung from patents. They are the great makers of employment, the creators of new channels for labor.” Wow, I guess that settles it. Hosteny correctly observes that “New inventions generate new businesses and jobs.” From this, he concludes, by quoting that irrefutable authority, the 1921 New York Times editorial, to bolster his assertion that because inventions are good, “inventions creating the benefits need[] protection.” Or as the NY Times wrote, “One would expect that the Patent Office, judge and recorder of all these business breeders and wealth makers, would be encouraged, supported liberally by Congress.” Hear hear! Support patents, liberally, whatever the cost! Cost is no object! In fact, let’s set up a tax-funded innovation prize--! For we can never have enough invention! What really caught my eye in this piece were Hosteny’s comments about “whiners”. First, he praises the importance of various innovations of “the late eighteenth and early twentieth centuries” such as “Otis’s elevator, the typewriter, the linotype, the washing machine, the zipper, the radio, the automobile and the airplane. Skyscrapers, modern printing and publishing, aviation, communications, and travel were made possible or greatly enhanced by these inventions.” True. And today’s “economy has a new engine, because of new inventions: the transistor, the integrated circuit, the computer, followed by the PC, the computer network, modern rockets and space satellites, composite materials for aircraft, artificial knees, and antibiotics.” But then he curiously writes, “And despite the whining we hear these days, would any of us want to return to the early twentieth century, the age of World War I and the influenza epidemic that killed twenty to forty million people after World War I? Of course not.” [emphasis added] Whining? What is he talking about, I wondered. Critics of IP? It is not clear. But no, as we find out later, he’s apparently talking about victims of patent lawsuits, such as RIM (Blackberry). But also note his slippery reasoning here: if you are a whiner (complain about being bankrupted by trolls, maybe?), you are in favor of “returning” to the wars and influenza epidemics of the early twentieth century! Wow. I’m feeling guilty already. Anyway, later in the article, when he complains about the PTO not being funded sufficiently due to fee diversion from Congress--this is the real problem, he maintains--he argues that “those in the media and in Congress, with some exceptions, do not appear to be listening. They spend time on fads, like the Patent Reform Act and listening to CEOs – like Jim Balsillie of RIM -- whine, and continue to ignore underlying problems that have existed for years, problems that will bedevil and undermine any “reforms” Congress may enact.” [emphasis added] Note again his sneering use of “whine”--in this case, to describe the CEO of RIM, who apparently is “whining” when he complains about almost being put of out business, and having to pay almost a billion dollars in what amount to patent extortion. Jesus. So not only do the patent sharks want to resist reform to temper the abuses of the patent system; not only do they want to continue to extract billions of dollars from peaceful companies; the victims should not even complain--or “whine”. Wow. One more comments. Changes to the PTO rules (currently enjoined) would have allowed patent office examiners to request the applicant provide an “examination support document,” which would force the applicant to “to describe the prior art and its applicability to the claims.” Now Hosteny maintains that the PTO is requiring this to shift work to the applicants, since, because of fee diversion, the PTO is overburdened. In my view, the examination support document is a great idea: patent lawyers and applicants hate to have to write down their views on paper, because they can be trapped by the statements later, e.g., in litigation. They want to keep all their options open, to be able to sue as many people as possible, to be able to have flexibility to make up whatever argument they need to defend the patent’s validity. But not, it’s too much to ask someone requesting a government monopoly to go on the record and state plainly whether and why they “deserve” the patent monopoly grant. They should get it without being “prejudiced”. It’s so unfair to make the applicant have to pay attorneys to read all those prior art documents, analyze them, and provide a coherent explanation of why the invention is sufficiently new in view of this prior art. No--the PTO should have to do it (though it’s not possible to do it right); or courts, in litigation; or the defendants who are being sued, who will have a big incentive to research the prior art (after all, if hundreds of millions of dollars are at stake, what’s a few hundred K spent analyzing patent docs). No, don’t impede the grant of patents--the lifeblood of invention! Shift the cost to the victims. Anyway, what I thought funny about Hosteny’s comments here were this one: “Furthermore, an examination support document would provide more grist for those who maliciously plead inequitable conduct, and would also give the infringers and the CAFC even more ways to argue that the prosecution history limits the issued claims. Applicants will still get to pay the user fees, naturally. That’s chutzpah. Only a government agency could get away with this scheme. Any business trying this stunt would sink faster than the Titanic, and would deserve to disappear beneath the waves.” Wow. Where do I start. First, re the complaint about “those who maliciously plead inequitable conduct”--what happens is, if you are sued for patent infringement, one defense you have is that the patent applicant engaged in “inequitable conduct” in obtaining the patent (withheld prior art, etc.). This is a common defense. Obvious, it’s disliked by patent plaintiffs attorneys, since they are so often on the receiving end of it. How unfair, if you sue someone, they should not “maliciously” fight back! They should just lie down and take it--after all, innovation in our society is at stake, good good, man (as well as 8 Ferrarris and 2 houses in Aspen!). And giving “infringers and the CAFC even more ways to argue that the prosecution history limits the issued claims.” Horrors! Then this: “Applicants will still get to pay the user fees, naturally. That’s chutzpah.” Wait--what’s chutzpah? Those applying for government privilege are not forced to do it. “Only a government agency could get away with this scheme. Any business trying this stunt would sink faster than the Titanic, and would deserve to disappear beneath the waves.” Ummm, I hate to point this out, but no private business could issue these kind of monopolies.