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Summary:

As the problem of patent trolling grows, calls for reform are coming from all quarters — including from a famous economist who proposes major changes to the system.

America’s patent system has been under fire for years but, in recent months, the criticism has grown louder than ever. There are currently six bills before Congress to fix the problem of “patent trolls” and now a leading economist is calling for even more dramatic measures.

Gary Becker, a Nobel-prize winning professor at the University of Chicago, stated this week that the U.S. patent system is “too broad, too loose, and too expensive” and called for the end of software patents:

Disputes over software patents are among the most common, expensive, and counterproductive. Their exclusion from the patent system would discourage some software innovations, but the saving from litigation costs over disputed patent rights would more than compensate the economy for that cost.

Becker’s comments, which he made on a blog he co-authors with famous judge Richard Posner, noted that many innovations — such as Einstein’s theory of relativity, Darwin’s theory of evolution, or Keynes’ economic models — are ideas that can’t be patented because doing so would impede scientific discovery.

Becker also suggested that patent protection could be reduced from 20 years to 10, even in industries like pharmaceuticals that depend heavily on patents.

Patent troll problem worse than ever

Part of the need for reform, Becker says, comes as result of patent trolls (shell companies that don’t make anything but use old patents to sue those that do) engaging in “hold ups.”

The economist’s comments echo those of Judge Posner, who has blasted the patent system as “dysfunctional” and, this week, noted: “The problem of patent trolls is a function in part of the promiscuity with which the patent office has issued patents in recent years.”

Posner added that “Trolldom is becoming increasingly profitable” and still growing.

The new criticism from Becker and Posner adds to a growing swell from Congress, President Obama and many small innovators who are sued by trolls but can’t afford to go to court.

On the other side are those like Dan Abelow, a self-styled inventor and owner of business method patents who is affiliated with prominent trolls like Lodsys. Abelow defended his behavior in a recent PandoDaily article and, on Twitter, advocates his vision of innovation. Here’s a screenshot of the musings from the man whose patents are being used to sue dozens of small inventors:

Dan Abelow Twitter screenshot

The newest attempt to rein in the business method patents like the ones favored by Abelow comes by way of Reps. Darrell Issa (R-CA) and Judy Chu (D-CA). Their bill calls for an affordable review process to challenge suspect patents outside of the courtroom.

  1. “economists” are idiots, today equivalent of medieval “doctors”.
    Not even able to spell below as main reason for current crisis :
    http://iiscn.files.wordpress.com/2013/07/bp-oil-price-2013.jpg
    due to :
    http://iiscn.files.wordpress.com/2013/05/jlliquidsworld.jpg

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    1. So you basically have nothing to say on the subject.

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      1. yes, exactly

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        1. which makes you the idiot in this sense, not economists.

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  2. Can the Nobel-winning economist spell the difference between software and hardware ?

    … algorithm in an executable object code, FPGA, ASIC….

    What the very first US patent granted for a process (method) ?

    F*** idiot

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    1. So you think FPGA is only doing simple math operations, no algorithms involved? You are an idiot then

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  3. Not being able to patent Einstein’s theory of relativity has nothing to do with encouraging scientific development. The principles of relativity were ” invented” a long time before the patent system existed, a long time before Einstein existed, and a long time before the Earth existed. The prior art for that “innovation” is a few billion years old.

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    1. Well said! You don’t need a special exception to make scientific laws unpatentable. It’s sad that the Supreme Court should feel bound to defer to a 19th century dictum. The statute is a complete code, and needs no gloss.

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  4. To bad ‘professors’ don’t have a ‘real job’!

    I may be biased, but I’m a software developer with a ‘patent’ for a business transformation process… which took many years to get… and thousands of dollars.

    Why would I want to give that up?

    Be serious! And create something useful!

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    1. It took you many years and thousands of dollars to patent? A ‘business transformation process’? And I guess you provided bread and caviar for lawyers involved?

      Seems like a better approach would be to sell your great software if it was so great and made billions.

      Care to publish your patent number?

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  5. Great articles on the subject on Opensource.com http://opensource.com/law/13/7/big-tent-letter-patent-reform

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  6. Joel Bainerman Tuesday, July 23, 2013

    Unfortunately the esteemed economist has nothing to say about how large companies abuse small patent owners by using their intellectual property without paying for it as they know they have nothing to fear from an individual suing a large corporation. Large companies steal patents and have been doing so for decades. While patent trolls may be a problem- it exists because patent owners have no way of properly monetizing their Intellectual Property as large companies will never pay an inventor for their efforts- but instead- steal them. Unfortunately that is not part of the “need to reform patents” debate.

    Joel Bainerman

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  7. You are right, this is another side of this problem. Everybody – patent trolls (with lawyers) and big corps trying to make money of a small guy’s idea. But, being a ‘small guy’ (I work for a small company providing services through a web site) so far I had to deal with patent trolls only, not big corporations. The problem is USPTO is just too backlogged or incompetent (or both) and issues patents on things that being in use for years and already a pubic domain (prior art).

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  8. The question, Bob, is why would the rest of us want to fund the thugs who will enforce that claim for you. You can’t exactly enforce it yourself, so, there needs to be something in it for us.

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    1. Well, the middle class pay taxes to subsidize drug research, FDA, the Ivy League universities. What do they get for it? They still can’t afford the drugs and their kids have no chance of going to the Ivy League schools. Life is like that, the poor subsidizing the rich. Nothing new!!

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  9. In the words of Ben Franklin: Fuck Patents.

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  10. As a holder of one patent on very basic and very important technical invention
    (low level algorithmic wizardry, close to hardware, can be hardware or software implemented) I am going on strike…

    Who is John Galt ?

    No more patent disclosures from me

    F*** those thiefs in Silicon Valley’s corporate boardrooms who gave 100s of millions $ to crooked DC politicians

    This country is going down

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