While Swaraj’s post deals with the economics of the entire patenting system, I thought I would present my point of view on the matter a little more conceptually.
First off, how has this entire discussion come about? The article, which was the focus of the posts needs to be read a little more carefully- without judging it by its title. The article points out the need of the patent system in terms of providing incentives, but does not agree with the functioning of the USPTO at present, in terms of the grant of frivolous patents.
Now a conceptual understanding into the Intellectual Property Regime will reveal that the need for the existence of the regime in the first place, is pretty much the same as the need for a legal system to be put into place to protect tangible property.
Very simply put, if X creates A, then X owns A. Owning Object A would mean that X would be allowed to use Object A in whichever manner he pleased, to the exclusion of all others. However, the nature of intangible property is such that the use of the Object A to the exclusion of all others cannot be for an indefinite period. Thus, a balance was sought to be struck by ensuring a period of use by the inventor/creator X as a publicly recognised monopoly, with the exchange made here for such information to be made available in public- to help further innovation/ invention in their chosen area of study.
A proverb in Sanskrit, of which I can only spout a vague translation off the top of my head, has taught us that Knowledge grows when shared. And that is exactly the basis for the manner in which Intellectual Property Rights are accorded protection.
The argument of the article in The Economist, and even those made by Swaraj, are all well taken. Certainly in theory it is possible for us to understand that there have been “frivolous patents” that have been granted in favour of inventors, and if looked at in the long run, the contribution of the inventors possibly do exceed their marginal social returns.
But practically, this is not an argument that I would say could be held valid or , better worded, is an argument that may be shaky for several reasons:
(A) Who is to say what inventions are frivolous? The article quotes Amazon’s one click patent and the “name-your-price” auction patent granted in favour of Priceline.com- a narrow view in my opinion. (This is the exact same line of thinking as our Patent Office when they read Section 3 (d) down to mean efficacy meant only therapeutic efficacy.) The author of the article fails to recognise that in a competitive world- where globalisation ensures that information does travel at the speed of light- a particular person/(s) spent a great deal of time and money in coming up with a solution to a problem, or a more effective manner in which his business can function. This may not be a the most useful invention universally, but so long as it furthers the functioning of a particular sphere (take the case of auction site or online booking), there can be no claim that the same is in fact frivolous.
For just that reason, a monopoly right being granted in their favour, cannot be viewed negatively.
(B) With regard to Swaraj’s argument on the ineffectiveness of the patent regime in light of the marginal social returns, a line from the television series Big Bang Theory comes to mind. When one character asks another, “What’s new in physics?”, the other replies, “Nothing”. It seems like most areas have hit that period of stagnation. At this point, if there is an invention that does make that one extra leap, what we refer to as the ‘inventive step’, in my opinion, according the same protection would not be considered unreasonable or undeserved, even from the point of view of an economist.
The problem in my opinion, that lies with the perception of the patent regime, or even all of the IPR regime in totality, is that people always view monopoly negatively. A fixed term for a period of use by a person who is undoubtedly the author/creator/inventor of the said object/process is in my opinion rational. This is especially because, the period of monopoly also grants competitors the opportunity to:
(A) License and/or seek assignment
(B) Use information from the patent granted as a base to probably improve or arrive at a new invention
(C) As already mentioned by Swaraj, economically it may be more efficient for a company, say pharmaceutical in nature, to come up with a “me too” drug.
But economically or otherwise, there are still several amongst us that have spent years of their lives trying to arrive at one conclusion or one invention that could change the world or the manner in which it functions at least, and in that context a regime that incentivises such creativity or innovation cannot be done away with.
For all those who have sat and read through my rambling, hearty congratulations and apologies!
Patent systems are not created in the interest of the inventor but in the interest of national economy. The Rules and Regulations of the Patent systems are not governed by civil or common law but by political economy
– Michael (Philosopher from Great Britain)
I may be way off the mark here but something else which commonly meets the eye is that by and large academics or those with an academic inclination see red when it comes to patents, and practitioners generally have a discernible pro-patent tilt…probably this is a very crude generalisation…
Sai.
Patents, by and large (though not *always*) are harmful, especially for Southern countries.
General problems with the patent system, off the top of my head:
1. It does not allow for independent creation.
2. It looks only at benefits accrued to another, and not harm suffered by the patent-holder. This problem arises as the patent system tries to internalise to the inventor all (or most) *positive* externalities arising from an invention. This arises from a misunderstanding of the “free-rider” problem, and is examined in depth by Mark Lemley in Property, Intellectual Property, and Free Riding.
3. Patent journals have not (and from the looks of things, cannot) fulfilled their mandate of being a source of information to advance knowledge in any particular field of technology.
Patent filings are masterpieces of lawyerly obfuscation. How else did an Australian lawyer obtain an innovation patent on the wheel or on a “method of exercising a cat”?
Not many inventors (even after decades and in some cases centuries of the invention of the patent system) trudge through the journals looking for new knowledge. The ones who do are much the exception.
This way, patent journals are thought of as the laws are thought of: one is deemed by a legal fiction to have read and understood them.
I agree that line-drawing, authority, and legitimacy become major issues when one starts the discussion of distinguishing frivolous from non-frivolous patents. However, there are certainly some eyebrow raisers … for instance, how about the screw-in coffin patent (http://www.boingboing.net/2010/02/09/patent-for-a-screw-i.html)?
On the issue of monopoly, one problem with the public image of patents and patent law seems to be the very use of the word “monopoly.” Recently I read a persuasive article arguing that monopoly in economics (the usual understanding of monopoly) and monopoly in IP are not the same. Perhaps patent law practitioners would make more headway with the public if they emphasized this fact.
The patents are some times referred to as monopolies but that is not always true. In economics a monopoly (Greek monos (one) + polein (to sell)) is defined as a market situation where there is only one provider of a product or service. In other words monopoly is “the exclusive control of a commodity or service in a given market’ held by force or by virtue of grant from the sovereign. It concentrates income to the holder of the monopoly at the expense of those who do not hold that monopoly and hence interferes with freedom of trade.
Patent cannot be viewed as a monopoly as it is not granted to something, which is already in public domain. So nothing is taken out of the Public. People can compete a patented product with advanced technology even while a patent is in force but they need to bring out the products based on different ideas. Thus a patent behaves like a grant of real property right, in that the owner of a house may exclude others from using it, but he certainly does not have a monopoly over the real estate market. Also when we cannot establish the time at which monopoly will end and competition will begin, while we limit the time for which a patent is granted. That is, we are setting the time at which the inventor will no longer be able to demand a price in excess of the zero marginal cost of his intellectual property. Therefore Patent gives the ability to preclude competition and not the monopoly in the abstract.
Thank you all for your comments.
Re: Mr. Praveen Raj- I think, by and large, you and I are saying the same thing.
Re: Gena777- You raise an interesting question which I definitely intend to do a lot more reading up on.
Re: Pranesh-
1. In terms of not supporting ‘independent creation’, I think independent creation is almost impossible in today’s day and age considering most problems have largely a solution in place, and most new inventions seek to address solving the same problem more efficiently. As for those being dependent on previous inventions etc, I think that’s what we refer to as research 🙂
2. I am not too sure I completely understand what you’re saying. I think I probably need to do a bit of reading in this area to comment on your second point.
3. I’m not sure how to respond to this point. Do you really see this as a flaw of the patent regime or as a shortcoming of inventors today?
@Kruttika Vijay
You write:
“… if X creates A, then X owns A.” That would not be true without going into what you mean by “creating” and “owning”. You cannot sidestep these big issues which are not intuitive. If I create a tune, why should I be able to restrict from using that tune? Or a machine based on my blueprint? Is the creator really a “creator”? What about things such as standing on the shoulders of giants? Where do the giants’ shoulders end and my feet begin? For a look at this from a literary perspective, please have a look at The Ecstasy of Influence by Jonathan Letham[1].
[1] http://www.harpers.org/archive/2007/02/0081387
1. Independent creation is almost impossible? I’m sorry but that seems like a restatement of “everything that can be invented has been invented” (misattributed to Charles H. Duell). I can think of a number of ways to rebut this. A) By your logic this was certainly not the case in 1790, but still, even then independent creation was not a defence. B) Even now, different companies compete, independent of each other, towards solutions to the same problem. Think of all the famous inventor clashes. The light bulb, the radio, the television, or even the discovery of HIV. (Gallo was made to share royalties for the AIDS test with the Institut Pasteur later by NIH.) Surely you don’t believe in the end of history in terms of science and technology! What about flying cars? quantum computing? cold fusion? wireless electricity?
2. One of the cited benefits of a patent is the public disclosure it results in. My contention is that this public disclosure is never meaningful, thus rendering that disclosure almost as good as a secret. If a software engineering student cannot look at a software patent application and can only vaguely guess what is being claimed, of what use is such disclosure? And that too when you come across those patents with much difficulty. My point is: have patents _actually_ fulfilled their role of provoking public disclosure and enhancing public knowledge in those arts?
This dialogue could be enhanced greatly if you could post your reviews of good academic works critical of the patent system such as those by Bessen & Meurer[2] (especially in their book Patent Failure[3]) and Boldrin & Levine[4] (in their book Against Intellectual Monopoly[5]) (the full text of which is available online). In your review you could point out flaws in their arguments, and we could have a fruitful debate on those points.
[2] http://www.researchoninnovation.org/
[3] http://researchoninnovation.org/dopatentswork/
[4] http://www.againstmonopoly.org/
[5] http://levine.sscnet.ucla.edu/general/intellectual/againstnew.htm
The problem I see in our current dialogue is that it starts at a very basic level (which is a good thing for lay readers), but in doing so fails to capture the rich debates that academics have already had on the benefits and demerits of the state-granted monopolies we call patents.
Dear Pranesh,
As always, thanks a ton for raising the ante for IP debates on this forum and for your insightful comments. While I agree with the main thrust of your argument, let me query you further on one point.
You argue that disclosure is never meaningful..and like most Western scholars I know, you use this argument to further argue that the patent system certainly cannot be supported on the “disclosure” requirement and the social contract theory more broadly.
If the “disclosure ” requirement is not being followed rigorously, wouldnt we better off fixing it? rather than using that as an argument to scrap the patent system altogether? In other words, what prevents a country like India from ensuring that more information (better titles and more details in the specifications etc) is provided throgh a patent application to make it more meaningful. Why do we assume that this requirement will always be gamed, as it is in the US, EU etc, owing to path dependency and perverse incentives that have taken root there.
@Shamnad
When I say that disclosure is never meaningful, I don’t mean to say it can’t ever, theoretically, be meaningful. My statement is more about practice, since I can’t see how a disclosure system can be made meaningful as long as the incentives to obfuscate are greater than the incentives to be clear.
You, as someone who files a patent, will benefit if other inventors do not understand the exact implications of your patent. That will a) make it harder to find and b) make it harder to avoid. This allows you to exact accumulated royalties once the companies that (unknowingly) violate your patent are identified.
There are indeed incentives to be clear (market valuation, etc.), but they are clearly outweighed.
Having said that, it might still be possible to fix the system. Do you have any suggestions as to how that could be done? And how ‘better title, more details…’ could be implemented?
very simple Pranesh,
re: title and abstract, you just ensure that the title and abstract are reflective of the “inventive concept”. and if they not broadly conforming, you create a ground for invalidation (in teh same way that you do for section 8 violations).
if you’ve gone through indian patents (whether published or granted), you’ll notice several discrepancies in the title and abstract that dont exactly correspond to the claimed invention.
Secondly, case law is legion with examples of what constitutes sufficient disclosure. india just has to pick the highest standard in this regard, just as it did for “inventiveness” in the pharma realm by articulating section 3.d.
Sometimes even US courts surprise us by mandating high standards in this regard. and take a look at Ajinomoto vs ITC, where courts came down harshly on patentee that did not disclose the best method.
In short, lets not assume that what transpires in the US will also necessarily transpire in India.
After all the US permitted rampant evergreening through their weak criteria. and our section 3.d has helped in busting it to a large extent. You have to think out of the box and fashion appropriate regime changes, and there is no reason why India cannot hike up her disclosure requirements.
I refer you to a passage by Petersbridge:
“Developing countries intelligently
implementing TRIPS may use the written description requirement to raise or lower the bar for patentability by requiring more or less description of the
invention in the application. They might also use the written description requirement to narrow or enlarge the scope of protection.”