The Economically Significant Patent

Nothing's Easy

On April 20th, about a week ago, USPTO issued a request for comments via the Federal Register seeking input on the latest bright idea from Congress. The short version is that Congress (and the technology lobbyists) want to explore placing a secrecy order on   "economically significant" patents to protect the economic national security of the United States.

The Federal Register contains the request,  nice background information on how secrecy orders work and the impact on the patent system int he event such a program were put in place.  Here are some of the highlights.  The request:

"Pursuant to a request from Congress, the United States Patent and Trademark Office (USPTO) is seeking comments as to whether the United States should identify and bar from publication and issuance certain patent applications as detrimental to the nation's economic security. The USPTO is also seeking comments on the desirability of changes to the existing procedures for reviewing applications that might be detrimental to national security."

Let's start with the basics.  A patent is basically a social compact where an inventor gets exclusive rights to their invention for a limited period of time in exchange for publishing information about how to make their invention and how it works.  Patent 101.  Barring publication is one thing.  Barring issuance is a REALLY BAD IDEA.

In a patent system where it's already taking an average of three years to get your patent application prosecuted and where USPTO can't find enough electrical engineers or computer scientists (or chemical and mechanical engineers) to deal with the explosion of applications we are now going to ask the examiners (or some other economic types) to screen the patents for matters pertaining to their economic significance. 

"Congress has asked whether the currently performed screening of patent applications for national security concerns should be extended to protect economically significant patents from discovery by foreign entities."

What is a foreign entity?  Is the overseas operations of a US company that operates as a division of a US company a foreign entity. (Just imagine the definition page that would go along with this set of new regulations.)

And here comes the definition of economic security:

"In this context, the Subcommittee describes "economic security'' as ensuring that the United States receives the first benefits of innovations conceived within this country, so as to promote domestic development, future innovation and continued economic expansion."

Consider Apple for a minute.  They are among the leaders in patented technology.  In the early days when they were cranking out the patents that would eventually lead to their "i" take over of the consumer electronics world - iPod, iPhone, iPad, iMac, with more to come, no one would have guessed that a touch screen invention where you swipe your finger across the screen to unlock your device would have been economically significant.  That was because we were all using Blackberries.

So now we are going to ask patent examiners, who quite frankly have enough to do and probably aren't the best ones to be in the business of determining market movements, to determine the economic value of a patent.  Or we are going to create a whole new universe of innovation police who are going to figure out what is and isn't economically significant.  USPTO hasn't been able to do this on well defined areas of the economy - consider the Green Technology Pilot Program where the Office set forth a bunch of classes that were their definition of "green technology" only to have to change the criteria when the innovators showed that there are many more ways to create clean tech that were outside of the boundaries of a certain group of classifications.

What's even more entertaining is that secrecy orders are handled by the Department of Defense (DOD).  DOD has its hands full dealing with cyber security and a couple of wars at the moment.  They barely have time to determine which patents have real national defense implications.  I doubt that the US Army would have thought that remote control toy car technology used to make improvised explosive devices was significant until, well, it was.  How would they have known which technologies would wind up in the latest IEDs?  

The secrecy order stuff has much bigger ramifications.  First, who is going to administer all this?  Second, if patents are protected by secrecy orders, they have the potential to lose their priority date when the applicant files overseas.  And then there's the really disturbing aspect - not issuing the patent.  Does the assignee and the inventor need to ask the government to issue the patent?  Will the Government decide when to issue the patent?  This whole process feels like it will do nothing but slow down the process and dramatically extend the innovate to market continuum, something the feds are trying to accelerate when they are funding Federal Research grants.  

Which has a bigger impact on our economic security - protecting an application based on some arbitrary determination at the time of the filing of the application that a patent is economically significant; or losing the priority date when the US inventor (this is also something hard to define) goes to file a foreign patent application.

Also consider the metrics.  About two thirds of the patent applications don't get granted.  The invention isn't novel or non-obvious, the inventor can't answer the examiner's questions in a timely manner, or the inventor just calls it quits and abandons the application.  So we're going to add a process to make an "economic security" decision about a patent application - when?  

Based on the language in the request, it seems that the decision would be made by a third party because the inventor/assignee has the right to request that an application isn't published already.  Imaging that can of worms.  Inventor sends an application to USPTO and some agency, government bureaucrat, or overloaded patent examiner decides a patent economic secrecy order is required.  Inventor doesn't want it, government does, all hell breaks lose.  The only guys making any money at this point are the patent lawyers.  (oops...sounds like an opportunity.)

The soapbox is out.  I'm about to opine as the patent lawyers like to say...

This is once again an over reach by the Feds seeking to protect us from a boogie man that doesn't exist.  If the INVENTOR or his/her firm think that their invention has significant economic value they have two choices - maintain it as a trade secret; or request that the application not be published.  Check the box - fill out the forms - it's not that hard.

Do we really need the US Government picking winners and losers.  Frankly their track record isn't really that good.