Patents for the Public Good

In September 2012, United States patent reform legislation goes into effect. (The “America Invents Act.” or AIA, Pub.L. No. 112–29; House Report No. 112–98 ,112TH Cong., 1ST Sess. 2011. Referenced as “Report.”) The Report states that the AIA was the first “comprehensive patent law reform in nearly 60 years.” The legislative process took six years and was heavily lobbied. It has been reported that in 2011 alone more than three quarter billion dollars was spent on lobbying. (“Lobbying The America Invents Act”) The Report stated the major premises of the act: “If the United States is to maintain its competitive edge in the global economy, it needs a system that will support and reward all innovators with high quality patents.”

Here are some of the main features of the AIA:

  • The AIA awards a patent to the first inventor to file. That claimant can be dislodged by a showing that someone else was the true inventor. Previous law awarded the patent to the first inventor, not the first to file.
  • It becomes far easier for corporations to own inventions. They are now granted much leeway to file for the patent directly, so long as the inventor is contractually obligated to assign the patent. The committee stated that this is to push aside “the antiquated notion that it is the inventor who files the application.”
  • A potpourri of other changes includes: new patent marking rules, failure to disclose “best mode” will not invalidate a patent, failure to obtain legal advice on patent validity cannot be used to prove willful infringement, procedures to correct erroneous patent prosecution information, federal jurisdiction of contracts to assign patents, a prior use defense, and post grant proceedings in the USPTO.

These are significant changes, but they do not comprise a comprehensive reform. The remainder of this blog will discuss elements of a comprehensive reform, rather than focus on shortcomings of the AIA.

Some history. From the twelfth century forward, commercial and industrial classes were steadily gaining influence English law and policy. As that movement gained steam, it persuaded the English Parliament to enact the Statute on Monopolies during the reign of James I. (21, James I Ch. 3, 1623.) The act was intended to abolish all royal grants of monopoly. The act provided an exception: A patent (“lettre patente”) might be allowed for limited years for those who perfect “any manner of new manufacture, within this realm.” The United States Constitution embraced similar criteria. (U.S. Const. art. I §#8, cl.8 ) A recent unanimous Supreme Court decision: reaffirmed that “the primary purpose of our patent laws is not the creation of private fortunes for the owners of patents but is ‘to promote the progress of science and useful arts,’ ” (Quanta Computer, Inc. v. LG Electronics, Inc., 553 U.S. 617, 626 (2008))

Patents flourished during the industrial revolution. During that period interested parties recognized that the patent monopoly could be used as a source of rent and a means to control economic activity. In short, patents were not simply a limited reward, but were a source of capital. Nurturing patents as capital became the primary emphasis in latter decades of the twentieth century. That emphasis was present throughout the AIA legislative process.

The role of technology and patents today. During the seventeenth through nineteenth centuries the United States and European powers pursued national interest and little else. Events in the twentieth century undermined the economic and political foundations of that approach. World War II exhausted Europe, and after that war, a consensus emerged that aggressive war, racism, widespread hunger and disease must be curtailed and, if possible, eliminated. Much of that consensus exists today, but has not been successfully acted upon. Now, the world population stands at seven billion, the climate is radically altering, while wars, poverty, and lack of education continue to create overwhelming suffering.

Technology can do much to aid the world. Technology advance depends primarily on social resources such as education, research, shared knowledge, and public institutions. Individual insight and company efforts contribute, often strongly, to that progress. One of the great innovators of all time, Isaac Newton, captured the gist of this combination when he urged that if he had seen further, it was because he stood on the shoulders of giants. In a modern environment, scientific and technical advance require investment in research facilities and the efforts of trained professionals. Patents offer a boost to useful innovation, but they are neither a necessary nor sufficient means.

Patents can encourage innovation, but they also can and do discourage it. This negative effect occurs when they are used as power, as a form of capital. A portfolio of minor patents can block introduction of new technologies and prevent delivery of new products to the public. A raft of scholarly writing investigates this problem. John Flock, a veteran patent litigator, observes that patents are used mainly as weapons in “global patent warfare as a way to gain leverage over a competitor in negotiations.” (2011 WL 5618030 ASPATORE). Patents of dubious validity compound this problem. According to Professor F. Scott Kieff businesses “are forced to defend against large numbers of lawsuits over junk patents.” (157 U. Pa. L. Rev. 1937, 1938 (2009)) Professor Mark Lemley echoes that observation, adding, “Even the ones that turn out to be valid are often impossible to understand.” (15 Marq. Intell. Prop. L. Rev. 295, 296 (2011)) It also should be borne in mind that patent procedures and litigation consume legal resources which might be focused on social needs such as reduction of domestic violence, environmental protection, criminal due process, and reducing the resort to warfare and war crimes.

Thus, any patent system ought to be designed to meet human needs. Its rewards ought never to extend beyond rewarding innovative effort or providing for research. United States patent law, for example, fails to assure that any gains from the patent monopoly will be invested in research or development. They can be spent on advertising, executive bonuses, lobbying, acquisitions, “golden parachutes,” etc. Nor does US law require that the patentee actually practice or license the invention during its term. These defects can be remedied by legislation.

Patents ought not function to control the economies or development of nations. The peoples of the world face very different needs and challenges. Huge portions of humanity are ravaged by war and disease. A very small percentage of the world’s population takes part in the levels of income, protection and luxury that are enjoyed by stock holding individuals or leaders of large corporations. The patent monopoly as it exists today fuels those disparities. Thus, rather than focus on increasing corporate values or control, patent laws should focus exclusively on making technological advance available to all at reasonable social and personal expense. This means that national laws need to be altered and that the entire intellectual property treaty structure needs to be reexamined. In major respects, patent law and the related treaties, serve primarily the interests of dominant corporations and national elites.

The world can benefit from cooperation on patent law. In today’s jargon this is called “harmonization.“ The term or its equivalent appears twenty times in the Report. However, the AIA’s emphasis on assuring the United States a “competitive edge in the global economy” runs contrary to international cooperation. This aspect of the AIA amounts to a modern form of mercantilism. Classically, “mercantilism was control of the economy in order to further national interests.” (Thomas B. Nachbar, 91 Va. L. Rev. 1313, 1318 (2005)) The AIA form of mercantilism allows patents to be a form of control that advances corporate interests, rather than national interests. The Report implies that the AIA will “spur innovation as a means to create American jobs and raise standards of living.” However, corporations and others from around the world can own US patents. They are free to locate their workforces anywhere and decide what wages they will offer.

In sum, I urge that patent laws be based on assessment of what will actually serve all. This requires lawmakers to consider these laws in their full context. It cannot be done by isolating patent policies from other legal policies and needs.


Howard C. Anawalt is a United States attorney, law professor, and writer.  His article on “Best mode” was featured in this IPilogue post.

  1. Although the AIA moves towards harmonization, it does not do so in any number of respects. The most significant (and public-regarding) aspect is its definition of “prior art,” which determines the scope of the public domain when assessing patent claims for novelty and non-obviousness. And in creating these new prior art provisions, although heavily lobbied, Congress did not clearly consider public-regarding purposes. Even had it done so, it would hve been difficult for Congress to reconcile the public purpose of better promoting innovation through increased scope of patent-eligible inventions with the public purpose of increasing access by placing more material in the public domain. Rather, Congress responded to lobbying pressures to determine these issues (as it does with so much else), and also did so without even adopting good drafting practices (leaving uncertain and ambiguous far too many issues that breed needless litigation — see, e.g., my brief article on derivation and prior art issues created by the new act at

    Further, although the Authors and Inventors Clause (or Progress Clause, or Science and useful Arts Clause, or Copyright and Patents Clause, since all have been ways of describing the same provision) of the US Constitution may be interpreted as encompassing primarily utilitarian purposes (for promoting Progress — however understood — in regard to Science — however broadly encompassed as knowledge — and useful Arts — whether or not incorporating fields of technology and other human endeavor), it is not clear that other interpretations are prohibited and in any event Congress is precluded from considering deontological or personality-based concerns in regard to the patent laws that it chooses to adopt (how else would one value outcomes for purposes of a grand utilitarian calculus?). No more are other countries so barred, which countries may base their views of IP rights more expressly on such alternative (non-utilitarian) moral grounds (such as authors rights or labor theories of property).

    So what is being asked for by Prof. Anawalt is for Congress to consider the general public good, even if it departs from national interest, when Congress has vast discretionary authority to determine what that public good is and should be based upon. Although I like to agree that Congress should adopt a patent system based on world-wide good (however that is to be determined), I fear that it is highly unrealistic to expect Congress to in fact act on that basis. Much less to consider the different views of “utility” or morality that consideration of the worldwide “public good” would entail.

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