Finally: This Is How to Fix the 'Patent Fix' We're All In

Wired has been running a special series of expert opinions on "the patent fix,**" including specific proposals for fixing the software patent problem. This is the final piece in the series, from the Mark Cuban Chair to Eliminate Stupid Patents.

It’s become clear that the patent system is impeding, rather than incentivizing, innovation. The laundry list of what’s gone wrong is long: a standard for patentable subject matter that makes no sense, notoriously vague and hard-to-understand claim language, the rise of the patent trolls ... and all of these problems disproportionately impact software.

Whether the answer is software-specific or not, one thing is clear: It's time to recognize that a one-size-fits-all patent system does not make sense.

That the patent problem exists is not news. Also not news: The software community is particularly hard-hit. So how do we make a system that many believe generally functions in many other technological areas work for software?

We don’t.

Instead, we look for solutions that make sense for software and don’t impact other technological areas.

Why Software Is Different

The traditional patent bargain -- a 20-year monopoly in exchange for a clear explanation of what the invention is and how to practice it -- makes sense in some cases. Take pharmaceuticals, which often require extensive research and development costing hundreds of millions of dollars; one can understand why we might reward that kind of investment with a government-granted, two-decade-long monopoly.

But software is different. It functions uniquely as a building block: The field is characterized by constant small improvements on what came before. It does not necessitate factories and manufacturing plants and years of testing at the FDA before approval. Instead, software requires just a computer and a coder. No doubt those coders work hard, but they can do so from their homes and existing offices.

Even more importantly: There isn’t any indication that developers *wouldn’t *write their code if they weren’t promised a patent in return. (If anything, the opposite is true.)

Yet software patents are nearly five times as likely to be litigated as other patents; the lawsuits surrounding them have more than tripled since 1999. And it will come as no surprise that a frighteningly large percentage of those suits are brought by parties who neither make nor sell anything: the dreaded patent trolls.

However it’s not the lawsuits per se but the mere threat of them -- coupled with the impossible-to-understand nature of what the patents actually say -- that chills innovation.

Because software patents are so hard to understand, parties facing claims of infringement cannot make realistic predictions about their chances to succeed in court. Facing that uncertainty, they often settle rather than litigate, which only emboldens the patent trolls. And who can blame the settling companies? Patent litigation is incredibly expensive and drawn-out, sucking resources from the very activities innovators need to focus on instead: creating, inventing and growing their businesses.

We Don’t Need Your Patent System

In the years-long battle that led to last year’s passage of the America Invents Act, we learned there are powerful lobbies that are fighting the kind of reform we need: limitations of damages, stricter filing requirements, and provisions such as fee shifting that make it harder to bring frivolous suits. Those lobbyists traditionally represent other technology areas, like pharmaceuticals and biotech.

To them we say: Keep your patent system. To Congress we say: Make it work better for software.

Some object to the isolate-software approach. Software is too hard to define, they claim. But Congress and the courts define things all the time. That’s not to say it will be easy, but it can be done. Others claim that trade agreements, particularly TRIPS, prohibit a software-only approach to reform. But TRIPS doesn’t do anything of the sort and in fact supports well-defined industry-specific patent regulation. Exemptions for surgical methods and drug testing are two existing examples.

But, the truth is, you don’t even have to address TRIPS. The problem getting the most attention -- both politically and in the media -- is the patent troll.

The troll problem -- the phenomena of non-practicing entities shaking down innovators and small businesses -- exists mainly in the world of software patents. Thus, any meaningful limit on the troll business model is essentially a software-specific fix. This is one of the many reasons we support the SHIELD Act, important legislation that would require a losing patent troll to pay the other side’s costs and legal fees.

Of course, Congress is not the only avenue for reform. The courts are well-positioned to come up with a judicial fix for vague and overbroad patents that requires applicants to claim what they actually invent, for instance. Companies like Twitter are taking matters into their own hands with proposals such as its Innovator's Patent Agreement to keep patents from being misused while others propose promising self-help solutions like a Defensive Patent License. And change can come from the patent office, too: Patent claims could be made through standardized forms or escalating fees could limit the availability of dangerous software patents.

Real reform will require such a multifaceted approach. More importantly, meaningful reform will require strong community working together with shared strategies and goals.

The Community Solution

The community has already started to coalesce -- first, at the High Tech Law Institute last fall, and more recently when more than 13,000 individuals contacted their members of Congress to support the SHIELD Act. President Obama, too, joined the growing chorus when he accused patent trolls of extortion and admitted the America Invents Act didn’t go all the way to fixing the problem.

Just last year, the tech community shocked the political world when it successfully fought the Stop Online Piracy Act (SOPA) and its Senate counterpart, the Protect IP Act (PIPA). It was no small feat to defeat these bills, a group effort involving more than 7,000 websites that went dark for a day in protest; companies like Google collecting more than 7 million signatures opposing the legislation; and organizations like EFF (where I work) collecting more than 1 million.

These protests got the attention of the bills' proponents. “The grass roots they can generate is, frankly, concerning,” stated Cary Sherman, head of the Recording Industry Association of America. But those so-called “grass roots” sound an awful lot like democratic process to me....

The RIAA wasn’t alone; policymakers across the country noticed, too. The protests generated so much traffic to the legislators' web pages that parts of senate.gov buckled under the load. SOPA author Rep. Lamar Smith of Texas was even greeted later with a crowd-funded billboard in his district warning: “Don’t Mess with the Internet.”

All of which is to say that the time for meaningful reform is now. We must strike while the iron is hot. The House Judiciary Subcommittee on Courts, Intellectual Property and the Internet recently held a hearing on the patent troll problem, and the Judiciary Committee Chairman has promised to “focus” on the issue.

Not only are policymakers increasingly paying attention, but society at large is ready to get into the game.

So the tech community can and should flex its muscle: It’s well-organized, arguably more so than it’s ever been. It has a receptive audience, since elected officials don’t want to incur their constituents’ wrath. And, most importantly, it has a compelling story: Software patents are hurting innovation and harming the economy.

*Editor's Note: You can catch up on Wired's entire *patent opinion series here. To help move reform efforts forward, many of these pieces proposed specific *Solutions to the Software Patent Problem, **thanks to a conference of the same name hosted by Colleen Chien and Eric Goldman at the Santa Clara University High Tech Law Institute. ***

Editor: Sonal Chokshi @smc90