“Innovatio” is patently double-dipping…

It’s time for patent law reform in which non-practicing entities aren’t allowed to hold patents, period. There’s no leverage against them, so there is no possibility for equitable agreements. The only argument for NPEs holding patents is for the patent system to reward small inventors, but the patent system isn’t doing a good job of protecting them anyway, as the patent office’s willingness to grant piles of meaningless patents is devaluing individual patents; the few good ones are lost in the noise. When patents do not serve their intended purpose of providing the common good of publishing an invention in return for a temporary monopoly on production, they should not be issued.

The current patent system is holding back innovation in many areas, not just software, and this is one of the thousands of straws that we’re piling on the back of a weak economy. A bad patent system is worse than no patent system.

Patents should be allowed inasmuch as we can measure the positive impact of the patents. When patents clearly work against their intended purpose, they need radical fixes.

The patent bar needs to be raised substantially. Now.

Innovatio’s Infringement Suit Rampage Expands To Corporate Hotels | The Patent Examiner

Pete Zaitcev October 04, 2011 12:04

Busting NPEs would be a good first step, but already Myrhvold finances fig leaf “research”, just so he can pretend to be a practicing entity. The fight is not going to end there.

Ingo Molnar October 04, 2011 12:32

+Pete Zaitcev

Indeed, agreed. The ability should be removed for private entities to impose private, undemocratic taxes that scale up to infinity on the rest of society essentially randomly.

Putting a ceiling on patent damages would do the trick economically: the individual inventor, who is supposed to receive incentives to innovate via the whole patent system to begin with would be just fine with a $10m ceiling for damages, if $BigCorp steals his big idea.

But $10m is not large enough to hold entire industries hostage to some essential patent that slipped through the Patent Office, and would also seriously damage the ‘hoard 10,000 patents to hold big entities hostage’ patent-troll Myrhvold business model as well.

It would still not be without methods of abuse, but it would be a beginning.

Another attack against patent troll economics would be to scale up the maintenance costs of patents per entity, exponentially: +1% fee for every extra patent owned. It’s not a problem for anyone reasonable who owns 10 patents (it’s only a +10% increase in patent maintenance fees), but for 10,000 patents it scales up to +1635828711188895969668098383848619605535356930% increase in patent maintenance fees.

As the urban legend goes, Albert Einstein once said that compounding [interest] is the most powerful force in the universe.

It is.

Michael K Johnson October 04, 2011 12:39

+Pete Zaitcev Yes, I agree wholeheartedly. Busting NPEs wouldn’t have a huge impact on the piles of bad patents. Perhaps a radical patent budget in which only a limited number of patents are allowed to be awarded per year; too bad I can’t figure out how to rank them.

+Ingo Molnar +1 — I’d vote for a $10m ceiling — enough to truly reward individuals; not enough economic incentive for a trolling industry. I like the exponential maintenance fees, too!

Though every time I hear “compound interest”, I now think about http://xkcd.com/947/

Ingo Molnar October 04, 2011 12:47

+Michael K Johnson

Yeah, compound interest is boring for bonds or bank account balances, but try a 2% interest over 500 years (if you are into dynasty building) or a 2% compound profit on 500 trades (if you are into trading): it’s 20,000x the original money …

Imported from Google+ — content and formatting may not be reliable