Why Hardware Patent Trolls May Be The Next Big Problem

from the they're-coming... dept

Tue, Oct 23rd 2012 9:22am — Mike Masnick

There's been plenty of talk about software patents, and tons of discussions from people suggesting that perhaps the "solution" to problems with the patent system are to simply carve out software (and business method) patents, and make those unpatentable. There are plenty of reasonable arguments for why "software" should not be patentable (I tend to find the arguments that you can't patent math, and that software is really math, the most compelling). However, I'd like to argue that while software patents are a large part of the problem, focusing solely on carving out software patents does not address the real problems of the patent system -- and, in fact, could serve to paper over the real problem by solving for a "symptom" (i.e., an awful lot of "software" patent trolling cases).

I do think that the problems with patents may appear to be more pronounced with software, in part because today's software patents really are broadly claiming functions, when they're supposed to be claiming specific methods. Also, given the fact that most people in the software world didn't even believe you could really patent software (until the State Street case), it meant you had very few "software" patents on the books for common things. This allowed people to get patents on things and claim, incorrectly, that there was no prior art, even if these things had been done for years. Add all of this together and you have the perfect recipe for a lot of trolling.

However, there are reasons to be worried that patent trolling is likely to increase on the hardware side as well. And, if we're serious about fixing the patent system, focusing solely on software patents is a dangerous path. It's a way to fight the symptoms, not the disease -- and, in doing so, it would allow policymakers to claim that they had fixed the problem, leaving significant problems in the underlying system in place.

We recently noted that economics Nobel Prize winner, Eric Maskin, told the NY Times that in industries that have "highly sequential innovation," that it "may be better for society to scrap patents altogether." And that applies increasingly to hardware inventions as well. While, traditionally, hardware inventions involved significantly more R&D and capital expenditure to make them possible, that's less and less the case today. Hardware production is becoming increasingly lean as well. There are a growing number of fabrication facilities that will help you make pretty much whatever you want, and prices are getting more reasonable while speed and quality are improving. Combine that with the rise of 3D printing and many (though certainly not all) types of hardware projects can become "lean" like a typical software company's projects.

Add to that one other key component: the rise of crowdfunding. One thing that we've noticed about patent trolling in the software field is that the lawsuits seems to come right after your company gets a lot of attention. And... there's been an influx of high profile "hardware startups" that have made their debut via things like Kickstarter. Many of the most successful crowdfunding projects have come from design/hardware firms -- opening them up to accusations by trolls. And, just like software startups who ignore trying to patent their own work, these design/hardware firms often do the same.

In a recent interview on Jerry Brito's Surprisingly Free podcast, Dan Provost, the guy behind two very successful design/hardware Kickstarter campaigns, talks about why his "accidental" startup didn't bother to file for patents, noting that it was just too expensive and the benefit of a patent on their products was minimal. At the same time, however, he did admit that they had already seen copycats of their two key products (the Glif iPhone mounting system and the Cosmonaut tablet stylus -- which I have and use all the time), but that it hadn't really impacted their business. I'd actually argue that Provost downplays some of the reasoning here. People who bought into Studio Neat's successful Kickstarter projects didn't just do so because they wanted to get the products in question (though that is a part of it), but also because they wanted to support Dan and his partner, Tom Gerhardt, in coming up with more awesome design products. When you see a copycat to a product you support via crowdfunding, people seem to rally around the original, rather than rush to the copycat.

It seems like basic social mores support the originator, rather than the pure copycat.

But that won't stop patent trolls from entering the space, and looking for "weapons" that they can use to effectively set up a patent tax on hardware innovations as well. Especially as we see more of these kinds of lean hardware startups, it seems inevitable that patent trolls will increasingly enter the space with broad patents designed to let lawyers cash in on the success of true innovators. So instead of just papering over the problems by carving out "software patents," how about we look closely at the real problems with the patent system and look to come up with real solutions that apply across the board. That means things like an independent invention defense, a better system for determining obviousness, actually getting input from those skilled in the art and (finally) stop all patent appeals cases from going through a single court that is subject to judicial capture by the patent bar.

Otherwise, we're just going to have to go back in a few years and deal with another bunch of patent trolling problems in hardware as well.

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Filed Under: 3d printing, crowdfunding, hardware patents, patent trolls, patents, software patents

27 Comments

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Coyo Stormbringer, 23 Oct 2012 @ 9:47am

The solution, obviously, is to scrap the entire patent system.

The entire system is broken beyond repair, and we really shouldn't have the State interfering anyway.
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Anonymous Coward, 23 Oct 2012 @ 9:51am

Another take
If there is a broad agreement that at least software patents are bad enough to carve them out, maybe the resulting growth of innovation will demonstrate the benefits of scrapping the rest of the system.
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Anonymous Coward, 23 Oct 2012 @ 10:02am

Re: Another take
Free and open source software does not use patents, and distributes source code. It is probably the most innovative part of the software industry, dominating everywhere apart from the desktop.
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Slopoke, 23 Oct 2012 @ 10:11am

Peer review
A well designed peer review process prior to granting the patent would go a long way to fixing the problems. It could deal with obviousness, prior art and over broad claims.
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Suzanne Lainson (profile), 23 Oct 2012 @ 10:16am

But who will fund the fight?
I agree that the patent system is flawed. But what always goes through my head during these discussions is who is going to get the laws changed. Sure, you could organize a citizen crusade to pressure DC, but patent reform or elimination isn't high on most voters' priorities.

Most big companies, by the time they have the money to pay for expensive lobbyists, are more concerned with issues that protect their turf than to make patent reform their primary cause.

Organizations that represent the interests of companies and individuals having to deal with trolls could mount a campaign. But again, it becomes a matter of having these organizations deciding this is one of the areas that they will focus on.

I think what is more likely to happen before the laws get changed is for courts to not to bother to hear or prosecute patent violations.

I just watched this yesterday and it talks about how states have been ignoring federal marijuana laws. It's still illegal to sell marijuana, but prosecutors aren't bothering to go after clinics and their customers.

Medical Marijuana: Will Colorado's "green rush" last? - 60 Minutes - CBS News
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out_of_the_blue, 23 Oct 2012 @ 10:20am

That's a narrow niche: wait until China copies 'em.
"Now, for CW&T, this is clearly a pretty horrible situation. The "partner" that they were working with to help them manufacture the pens that everyone had bought had apparently started his own company to make nearly identical pens... and did this while still waiting for the full order of original pens to come in. CW&T responded by just telling the world what had happened:
In response, many Pen Type-A supporters quickly came out in support of CW&T and against Torr Pens. Fab.com pulled down their sale, and other sites started to pick up on the story. I don't know if CW&T have any legal recourse, or if they should even bother, but they realized that just by talking about the situation with the large group of fans they had connected with, they could have an effective response."

Well, that's a MORAL response, not a legalistic one. All hail out_of_the_blue for harping on morality despite rabid opposition to it from regulars on Techdirt.

But less seriously, how do -- well, first, patenting a pen design is NOT what the system is for -- but for a pen, how do you prevent knock-offs from China? -- You can't without complexities that I agree are entirely bad. That again isn't what the patent system is for: no reason why a physical (fashion) gadget can't be copied. [Inner question: Wait a sec. Have I reversed myself? ... No, always been against "fashion", and that's all this "design" is, not any fundamental mechanism, just a case.]

Anyhoo... Holy cow! At last Mike is focusing on morality! And that those who didn't create it don't have a right to use it!-- NOW, if you could just replace "pen" with "movie data", you're ALMOST round to my position!
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Scott, 23 Oct 2012 @ 10:21am

I always think patent and copyright trolls are nothing more then extortionists.
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Anonymous Coward, 23 Oct 2012 @ 10:23am

Of course there's already lots of patent trolling on hardware.

Rounded edges patents anyone?

Just because Apple actually builds products doesn't mean they haven't become a patent troll.
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Anonymous Coward, 23 Oct 2012 @ 10:27am

Re: Peer review
As much as I would love to see a world with the end result of "fewer patents", I'm afraid any peer review system for patents is going to heavily incentivise the peers to deny patents: any peers who could provide meaningful review of a patent will likely benefit from not locking up the invention it claims.

It's sort of the Dunning-Kruger effect of the patent system: in order to recognise that a patent is truly valid and worth granting, you have to be in a position to be affected by the monopoly you are handing out.
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Josh in CharlotteNC (profile), 23 Oct 2012 @ 10:30am

Re: Peer review
That's what patent examiners are supposed to be doing.

It's not working.
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Chuck Norris' Enemy (deceased) (profile), 23 Oct 2012 @ 10:31am

Re: That's a narrow niche: wait until China copies 'em.
Of course, morality only works when people feel a moral obligation to some extent. I bet plenty of people would like to pay musicians/actors/directors directly for the content they create but don't feel any moral obligation to pay some middlemen who do their darnedest to not pay the creators in the end.
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Anonymous Coward, 23 Oct 2012 @ 10:32am

The line between hardware and software is often very blurry.
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James Burkhardt (profile), 23 Oct 2012 @ 10:37am

Re: That's a narrow niche: wait until China copies 'em.
I don't see how the current article is about moral arguments, rather than legal ones, or why they have to be separate issue in this case. In fact the general techdirt stance is that hardware and software patents are, in general, actaully illegal by Letter and Spirit of Law (LSL) and therefore, need to be reworked.

You seem to be courting controversy, Trying to claim that you have worked techdirt around to your POV, despite that fact that this article is nothing but applying the current legal/moral stance around patents to potential future problems.
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Anonymous Coward, 23 Oct 2012 @ 10:41am

Re:
Apple no more filed a design patent application directed to "curved" edges than it did for a "rectangular display". Of course, to understand this requires an understanding of what design patents are and actually cover, as well as the specifics of the Apple design patents that were alleged to have been infringed by Samsung.
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Anonymous Coward, 23 Oct 2012 @ 10:43am

Re: Re: Peer review
It does work relatively well, but it is useful to keep in mind that the USPTO is required to act on "evidence" before it, and not "speculation/conjecture", as is the case with all legal proceedings.
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DH's Love Child (profile), 23 Oct 2012 @ 10:51am

Re:
"The line between hardware and software is often very blurry."

Especially as software is increasingly used in the design and fabrication of hardware.
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Tim K (profile), 23 Oct 2012 @ 10:53am

Re: That's a narrow niche: wait until China copies 'em.
Have you never heard of the CwF thing they have talked about here? That's exactly what this is about. CW&T connected with their fans, and appealed to them to not support the other company who copied. If CW&T had been a shitty company, I doubt people would have really cared too much about supporting CW&T vs another company. But yeah, Mike never talks about that and is totally against it.
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Atkray (profile), 23 Oct 2012 @ 11:38am

Re: Re:
That is the solution assign all patents and copyright to Skynet.
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Andrew D. Todd, 23 Oct 2012 @ 1:13pm

Re: But who will fund the fight?... to Suzanne Lainson, #5
Big companies sooner or later realize that patents are a two-edged sword, and that the main beneficiaries are patent trolls. This awareness reflects itself in Congress. The America Invents Act went through with only minimal resistance-- Senate committee: unanimous; Senate: 95�5; House committee: 32-3; House: 304-117; Senate (reconciliation): 89-9; and the President signed it. There was really no organized opposition. Some Tea-Partiers voted against the bill, but this was merely an empty gesture for the folks back home, to show their independence.

http://en.wikipedia.org/wiki/Leahy-Smith_America_Invents_Act

The most effective immediate measure is for big companies to file large numbers of Requests for Reexamination, thousands of them, within existing law, against patents which they think might affect them. The lawyers do the work of locating prior art, and working out chains of inference for immediate obviousness, and all the patent examiners have to do is to look at the instances cited. Not surprisingly, the outcome is different from that in initial examination, where potential defendants are not represented.

As I've said previously, I have some difficulty seeing how patents on physical objects made by 3-D printers would be a real problem. You can make plastic figurines easily enough-- if you like to collect plastic figurines-- but objects for actual use tend to have important properties at the molecular level.

http://www.techdirt.com/articles/20121012/01535020687/just-as-key-3d-printing-patents-get- closer-to-expiring-intellectual-ventures-patents-3d-printing-drm.shtml#c336

People talk casually about making their own automobiles-- as if steel was just another kind of plastic. It is very unlikely that one could produce a street-legal home-brew automobile from raw materials for less than $500,000, or the equivalent in skilled labor.
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Slopoke, 23 Oct 2012 @ 2:11pm

Re: Re: Peer review
I don't really see that as a problem. On the one side you've got the USPTO incentivised to grant patents. Having a peer review group with an incentive to deny them would seem to just balance the equation.
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Anonymous Coward, 23 Oct 2012 @ 7:51pm

Software can be likened to a recipe as well. Recipes can't be patented either.
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Niall (profile), 24 Oct 2012 @ 5:02am

Re: Re: Re: Peer review
So you really want a bicameral system like most Western democracies, where one house proposes, and the other disposes...
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Anonymous Coward, 24 Oct 2012 @ 5:14am

Re: Re: Re: Peer review
Then the U-STOP has the requirement to actually gain relevant evidence, not just one side's ridiculous claims. Or it really just becomes patents to toast bread or swing a swing, especially if all that needs to be added is "on a computer/on the Internet". A marketing document, which half these claims appear to be (as re-written by a lawyer) is *not* 'evidence'. And certainly not the sole evidence the USTeaPOt service should be using.
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Niall (profile), 24 Oct 2012 @ 5:18am

Re: Re:
A deep understanding of design patents:

US: Apple can patent rounded edges and rectangular display, because only Steve Jobs could ever think of such amazingly original concepts.

Rest of World: Apple are taking the p***. Get tae f***.
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Corwin (profile), 24 Oct 2012 @ 12:23pm

Micronations?
An obvious solution is to host advanced, disruptive tech and models outside the system. Since the decrepit world order is still publicly limiting itself by rules that tautologically declare that they don't concern some places, we can exploit that mechanic. Hype the "unbreakeable, unlimited, unregulated Free Net", it's always possible to pass packets to/from a network to another, even if you have to burn the tcp packets to CDROMS and send responses by punch cards in bottles on sea currents.

Getting to the point. Auto-fed CNC machines, pulling instructions from the 'Net and replicating tech patented everywhere but where it's ignored, with enough public hype to make it matter to those whose careers still live and die by votes that they won't dare martyr people for making tools. Then selling things priced at their marginal production cost. Then let seven billion brains freely figure out how to make things more efficiently, that should work slightly better than a rigged market that spends all its resources to figure out how to screw the other parts of itself.

Then we'll buy ALL OF THE MONEY in Bitcoins. Yeah, that'll happen.
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Anonymous Coward, 27 Oct 2012 @ 6:44pm

Re:
Correct. Where can we find politicians who are prepared to get the job done?
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Anonymous Coward, 27 Oct 2012 @ 6:49pm

Re: Re: Another take
Correct. The reason why it does not dominate the desktop is the Windows preload that Microsoft has managed to force on all large personal computer manufacturers.
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