Infringers handed new tools to attack patents

Sir, In his response (Letters, November 1) to Rana Foroohar’s welcomed Big Read article (October 17) on how changes to the patent system in the US are stifling innovation, Gary Shapiro argues that further legislation is needed to make the US patent system even less effective. His position is based on two false premises:

First, that it is patent trolls not big tech that is harming smaller and medium-sized tech companies; and second, that legal and legislative changes to the US patent sysem have helped but do not go far enough. From my experience, patent trolls have never been more than a nuisance. I have been a patent practitioner for more than 30 years and have not once negotiated compensation to a troll on behalf of a client.

However, I am aware that the leaders of dominant industries, now presently the tech industry, feel they should be able to control the pace of innovation in their industry. Anyone new to the industry who dares to come up with an innovation is an unwelcome intruder.

Before Big Tech, it was the automotive companies that were dominant. The inventor of the intermittent windshield wiper, Robert Kearns, spent most of his adult life being dragged through repeated litigation by the large auto companies which refused to pay him a licence fee for using his invention.

The most recent changes to the patent system have given alleged infringers many new tools for attacking patents. The most significant is the inter partes review (IPR) procedure, which was intended to allow patent challenges to be heard by the US Patent Office rather than the courts. The procedure is unfair to the patent owner. The Patent Office has used its new-found authority as an invitation to discard patents that it had previously issued in a procedure that is biased against the patent owner.

Wall Street has discovered that it could make money by shorting the stock of bio-tech companies who rely on one or two technologies then initiate an IPR in order to challenge the patents of that company which are typically its major assets. The stock of the company tanks and is then sold at a reduced price and the difference is profit to Wall Street.

source:https://www.ft.com/content/d35623e8-bfda-11e7-b8a3-38a6e068f464