In 2011, Barack Obama signed into law, the “America Invents Act”. After his administration received outcries from the public stating that the patent system had become too “slow” and “bogged down”, the president himself addressed congress to gather a convention whereas a new law could be created in order to stream-line the process. “What used to take days to patent, now takes years!” is what many exclaimed. Which is true, however, the population was much lower 150 years ago and society was less complicated.
Before the America Invents Act of 2011 passed, our US Patent system operated under the “Who invented it first?” principle. Just because a corporation or wealthy aristocrat filed a patent on an invention, didn’t mean he/she would necessarily get the legal protections and exclusive rights to the invention. At any point, someone could challenge or argue the filing, showing evidence that they were the original innovator who created the product, therefore they would be granted the privilege of holding the patent right.
This principle has bogged down the system in recent years because of the many challenges made towards filings, but has always protected “indie” inventors, i.e.- poor inventors who couldn’t afford to immediately file things into the USPO. Filing a patent isn’t cheap for someone who may be working a normal 9 to 5 job. Our old system ensured that those who actually created an invention would receive credit for their work instead of giving leeway to those who could simply steal someone’s research and could afford to file it under their capacity, essentially profiting from someone’s original work.
Prior to 2011, the USA, was the only country in the world, to operate under the “Who invented it first?” principle instead of the “First to File” principle. With America’s newfound obsession to “Be like the rest of the world”, we have inadvertently shot ourselves in the foot. Since the passing of this law, low-income inventors feel completely shut out of the patent system. In order to protect themselves, they have to either rush the development of their invention in order to be “The first to File”, or they have to patent each stage of development. Both tactics can be costly in terms of legal fees and result in a product that is rushed.
Under the old system, people felt less rushed to get something patented, so long as they felt confident that they could prove they were the original creators. Now, under our new system, none of that matters. To make matters worse, the America Invents Act contains tons of “ear-mark” language that exempts banks from having to pay royalties towards inventions. Many small business owners and low/middle class citizens are calling the America Invents Act the “Anti-Inventor Big Business Earmark Act ”
Big corporations can afford to file as much paper work and legal documents needed in order to secure a patent. Under the old system, if someone’s invention was stolen and then filed in as their own creation, the filer could be sued very easily. In fact, many people are abusing the new system as a way to scam competitors. People may pose as an investor or journalist, looking for feedback from inventors, then take their ideas, patent them, and then sue the original creators for trying to market their own inventions!
(Nalini-Global owner, Randell Stroud, with David Kappos)
Even though I disagree with his support for the “America Invents Act”, earlier this month, I had the chance to spend the afternoon with a man who is largely responsible for the passing of this law, David Kappos. After his lecture, we got a chance to hang out, discuss cryptocurrencies and other issues affecting IP Law. David served as the Under Secretary of Commerce for Intellectual Property and Director of the United States Patent and Trademark Office from 2009 to 2013. I really enjoyed picking his brain! He was a really nice guy, with a ton of wisdom in regards to IP law, however, I still disagree with his stance on this particular law.
The good news is, even though small time inventors may feel as if they are left out of the patent game, they can still somewhat protect their works through copywrite and trademarks, which are far less expensive to enforce and create. While it may not keep large corporations from totally stealing your products, it can create a legal deterrent, as defending copywrite infringements aren’t cheap. However, be forewarned, the new norm is patent lawsuits is the award attorney fees to the defendant if he can prove that your suit is without merit or there are special circumstances as was the case in Octane Fitness, LLC v. Icon Health & Fitness, Inc.
(***FYI- Patents refer to the inventions themselves, whereas copywrites refer to the expression of an idea through literature or artistic works,)
This brings me to my next point. As a Libertarian, I can’t help but to wonder if the patent system should exist at all. Yes, if someone totally steals your design, part for part, gear for gear, even using the same logo and name for their product, we could consider this a form of fraud. Similarly comparing to an event where someone was using your legal name without your permission.
However, from a free-market perspective, if someone where to create a similar product, under a different name and logo, that performed better and was less expensive, should patent law keep him out of business? My answer is “no”! The Free-market, when allowed to function properly, correctly picks winners and losers, and does not use tax-payer money to bail-out failing products. I feel that the idea of patents themselves have turned too much into a way to monopolize a product so that companies can preserve their piece of the economic pie. Good ideas cannot be locked away from society to use.
On the other hand, it would be totally unfair for an inventor, who has spent years researching and developing a product, become a victim to marketing theft. If I were to create a website brand that looked exactly like “Reebok”, and all of my products looked exactly like the original Reebok sports brand with identical designs, with an identical logo, and then I became a millionaire, is this not a form of theft? It is worth discussing.
Without copywrite, trademark, and patent laws existing to some degree, it would be difficult to become fans of any writer, musician, or developer, because no one would know which brilliant mind that these amazing works were coming from. Unchecked “copycats” would dilute innovation and encourage stagnation of development.
On the contrary, government rules around patents, trademarks, and copywrites that become too intrusive, overbearing, and burdensome, will eventually create a wall between small-time creators reaching recognition and success, especially when you consider that their competitors will most likely be huge corporations and wealthy aristocrats who can afford the rules of the unfair legal system.
Like in all matters of the law, we have to strike a balance between liberty and security. Protecting the logical rights of men and their properties, while not creating monopolies that only the wealthy and the governments themselves can understand or afford to participate in.
That’s the problem with our current legal system. The legal system is a glorified socialized “gun” that we use to point at one another in a “civilized” courtroom. However, it doesn’t make society any fair or safer when that shared use of force can only be afforded by certain groups of people. Namely, the extremely poor who can claim to be “indigent” , or the extremely rich who can afford the best lawyers or to pay off judges. It is the middle-class who has no remedy. They don’t qualify for low-income exceptions, and they cannot afford a legal team of their own. Where do they go?
Regardless of your political ideology, it is clear– The America Invents Act needs to be scraped. If the US Patent system is slow, bogged down, and underfunded, we can come up with a new reform that doesn’t exclude up and coming inventors who cannot afford to keep up with expensive and tumultuous “first to file” system, which hasn’t spurred any major innovations in other countries.
Airplanes, cars, Televisions, the iphone/smartphone, all of these were produced under the “First to Invent” principle. These amazing inventions have changed the shape of our entire sociology. If such great inventions came from our old way of doing things, why should we seek to reinvent the wheel? Wheels are round for a reason, they are designed to “roll”. This new law is like someone suggesting that wheels should be triangular instead.
What do you all think? Should the America Invents Act remain, should we go back to the old system, or should we scrap both methodologies all together and create a brand new way of looking at patents?
- Randell Stroud
Randell Stroud is an experienced paralegal specializing in constitutional, bankruptcy, human rights, and international law. He has authored several books including, “Global Human Trafficking in the Family Law Courts”.