Much ink has been spilt on the issue of Indian patent laws and how good (or bad!) they are (depending on which side of the you are) on this blog. This post deals with a different issue of patent quality / examination etc. and covers a recent report issued by the United States Government Accountability Office (GAO) on the functioning of the US Patent & Trademark Office (USPTO). It is extremely interesting to see the same issues that arise at the Indian patent office, arise at the USPTO. No examination, or high grant rates without fully examining an application are a common phenomenon at the USPTO.
GAO findings also highlight that low quality patents are routinely granted in the software-related patents and computer and communication technologies. There are interesting lessons that can be drawn while considering the report. In particular, the Indian Patent Office needs to apply the law thoroughly on the applications. The Indian examiner need not just rely on the office actions cited by the USPTO but need to do their own searches for prior art, etc. and apply the Indian patent law. As can be seen from the GAO report, the findings are grave for software-related patents and computer and communication technologies. Indian law proscribes grant of patents to software per se and due care must be taken.
The GAO report also discusses that it costs millions of dollars to litigate patents, quite a few of them are of low quality, i.e. should not have been granted in the first place. This is equally true for India. The Ramkumar / Bhogilal patents are a case in point. The patentee was able to extract crores from the market before the patents were invalidated. It required Spice, LG, Micromax, etc. to spend money to fight the case.
In some sense, the problems are amplified here. Even though the laws provides that the mere grant of a patent is not proof of validity, in practice judges consider them to be valid because examiners may have considered the factum of patent grant in other jurisdictions or that they have not been challenged. This practice is like the value accorded to the grant of a trademarks where the law provides that grant of a trademark is proof of its validity. Here the judicial lens simply swaps patents for trademarks.
The GAO report also relies on the Alice Corp. Pty. Ltd. v. CLS Bank Int’l (Alice) decision and discusses that decreases in litigation that occurred in 2014, both in the number of suits and defendants, were likely due to the Alice Corp. decision. The Court in the Alice decision held that where a patent claim is based on an abstract idea, which is not patentable, merely using generic computer implementation does not transform that idea into a patent-eligible invention. This decision has limited the validity of what some stakeholders considered to be overly broad and low quality patents thus preventing them from being used to file infringement lawsuits.
The report may be accessed by clicking here.
To summarize the GAO report concludes that there are several low quality patents granted by the USPTO. The GAO report finds that most patent suits involve software-related patents and computer and communications technologies. Several stakeholders told GAO that it is easy to unintentionally infringe on patents associated with these technologies because the patents can be unclear and overly broad, which several stakeholders believe is a characteristic of low patent quality.
GAO recommends that USPTO more consistently define patent quality and articulate that definition in agency documents and guidance, reassess the time allotted for examination, analyze the effects of incentives on patent quality, and consider requiring applicants to use additional clarity tools.
