4 Reasons Why The U.S. Patent System Is Broken

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Cracks in the U.S. patent system are evident.

Stephen Key

Historically, patents have helped level the playing field for independent inventors. Today, that’s become significantly more difficult.

As Drew Johnson, former national director of Protect Internet Freedom, succinctly put it in a recent article for Fortune, “Google and other tech giants have determined that the potential benefits of pilfering intellectual property outweigh the potential costs of litigation.”

This practice is so common, it has its own name: Efficient infringement. At a conference for IP attorneys, I heard someone say, “The only true way to determine the value of a patent is if it holds up in court.” That’s great news for the legal industry — and heinous for the rest of us.

Here are some of the biggest problems with the U.S. patent system today.

1. Your issued patent can be overturned. Congratulations! Your patent attorney or agent successfully negotiated with your examiner to get your patent to issue, and now you’re proud to be a patented inventor.

But that could change if a company with deep enough pockets is inconvenienced by your patent and decides to challenge it at the Patent Trial and Appeal Board (PTAB) by filing an inter partes review. PTAB was established by the 2011 America Invents Act.

Yes, you heard that correctly. The same body that issued your patent — the United States Patent & Trademark Office — can later decide that oopsie, a mistake was made, and take it away.

2. You cannot find all of the prior art. The term “prior art” refers to evidence that an invention isn’t new, and newness is a requirement for patentability. Prior art is not limited to patents. Printed publications, like magazine articles and academic papers, constitute prior art, as well as oral presentations at scientific meetings, demonstrations at trade shows, speeches, YouTube videos, and other material found online.

It’s impossible for inventors to find all of the prior art. This is a problem, because prior art will be used to justify rejecting the claims in your patent application and overturning your patent at the Patent Trial and Appeal Board.

“Currently, close to 80 percent of U.S. patents that are challenged at the USPTO end up being held invalid because of some prior art that wasn’t in front of the examiners when they reviewed the application,” writes Louis Carbonneau, founder and CEO of Tangible IP, in the latest edition of his newsletter “IP Market Updates.”

3. Patent attorneys and the USPTO make money regardless of how successful their clients are. It doesn’t matter how marketable your invention is. You will be able to find a patent attorney who agrees to help you patent it, even if the claims you end up with are basically worthless from a business perspective.

There’s a conflict between patent attorneys and the inventors they rely on that you need to be aware of. Patent attorneys exist to help you protect your invention, but they’re not responsible for your ultimate success as an inventor. It’s up to inventors to determine how patenting fits into their overall business strategy.

4. The metrics for measuring the success of our IP system are all wrong. The number of patent applications filed and maintenance fees paid each year are poor indicators of our innovative potential. Patent applications are filed for all sorts of reasons, innovation only sometimes being one of them. The true measure of success is how intellectual property is being used by creative people to share their ideas with the world, so we all can benefit from them.

To that end, inventors need to be educated about how to use intellectual property to support their business ventures, not in theory, but in practice! There is a disconnect between how patents are defined and how they actually function given the myriad of challenges for inventors to overcome.

For example, the right conferred by a patent is to “exclude others from making, using, offering for sale, or selling” your invention. But that isn’t true anymore, if it ever was. Having a patent will not stop someone from stealing your invention.

Nonetheless, I’m continuing to invent, patent, and license my ideas, and here’s why.

Most products on the market are not patented. It is possible to license product ideas to companies without patents. Licensing an idea to a larger company that has great distribution and enough legal resources to do a little arm twisting, if needed, is a way of protecting one’s interests.

There are new ways to protect creative ownership online, including using social media to build an army of fans and let the world know you are the original. Trademarks, copyrights, and design patents can be used to stop copycats and police infringers. Because reviews are ubiquitous, offering your customers great service is more important than ever. Always take care of your customer.

You can teach yourself how to file patent applications that have value, be it raising capital for your startup or securing a licensing agreement. You can educate yourself about what’s realistic, and what’s not.

Don’t fear what you might find in the prior art. Instead, search for it and study it extensively so you know where the landmines are located. Use what you find to hone in on your invention’s point of difference. Prior art can be transformed into a selling point. Teaching yourself how to do a preliminary search for prior art is well worth the cost and time, even if you decide to hire someone to do a more extensive worldwide search later.

You can improve the quality of the patent applications you file by trying to steal your invention from yourself. Make sure to include all of the variations and workarounds you come up with. Determine what the most efficient way of manufacturing your invention is without sacrificing quality, and include that too. Prototyping is a great way of discovering new variations and even new inventions, Carbonneau points out.

Fundamentally, I believe inventors must take responsibility for their own financial success. It’s all too easy to blame others for our failure, including the patent system.

We have to do our own homework. We have to determine whether our inventions truly have value in the marketplace before spending time and money on the patenting process.

And when we do file intellectual property? We must know how to use it correctly to navigate challenges in the marketplace.

The patent system isn’t perfect, but then again, it never has been.

Patents become useful tools when they empower entrepreneurs to license their product ideas, raise money for their startups, and build their teams. Please, educate yourself about how to extract the most value from the patent system. No one else can do that for you.