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A Sort of Patent Reform

April 22nd, 2005

This past week my Legal Protection of Software course has been instructed by T. Andrew Culbert, Microsoft’s Associate General Council for patents. This is not the guy who secures patents (known as patent prosecution), he is the guy who does the litigation (both defense and plaintiff work). It has been a really illuminating experience and given me a lot to think about in regards to software patents.

In the past I have been majorly opposed to software patents. I’ve even written a nationally syndicated article about the how stupid they are. I’m not alone in my opposition. Just a few days ago India revised its new patent statue to exclude software patents and the European Union continues to struggle with the proposal. But I’m beginning to develop a more nuanced appreciation for software patents thanks to the past few weeks.

Mr. Culbert’s perspective is one where corporations are the only actors, which isn’t exactly how the world works… but its not too far from the truth. Given his assumption, software patents aren’t really all that bad. See, patents have this interesting ying-yang property. If a patent is really broad then it has a greater chance of stiffling future invention, but it also has a great chance of being invalidated on prior art. Other the hand, if a patent is really narrow, it has a greater chance of validity, but covers fewer inventions.

One of the classic examples of this is the Amazon One-Click patent. Oh sure, its a stupid patent… how can someone patent doing something with one click?! But then again, what’s really the big deal? The only way to keep the patent valid is to narrowly construe its terms to cover only systems with one-click, leaving two-click systems outside of the scope. Barnes & Noble easily designed around the problem with a nifty little pop-up asking “are you sure?” Done, no more problem. Suddenly the value of the software patent plummets and its no longer worth all of the legal expense necessary to take out a patent in the first place.

Indeed, that is exactly the behavior we have seen. Fewer software patents and business method patents are being taken out. Those patents that are filed face daunting prior art challenges, leaving only truly innovative ideas that might never have been developed without the promise of exclusive control. But this where we come crashing back into reality… the only way to bring a successful prior art challenge is to be a giant corporation with lots of money.

The assumption becomes even more tenuous when you add in cross-licensing behavior. Instead of suing one another to invalidate the giant arsenal of acquired software patents, corporations cross-license them at no cost. Essentially, the only people with the resources to challenge the patent are allowed to use them free from the threat of suit. This leaves the “little guys” to fend for themselves. They face two primary challenges: 1) developing technology that is covered by an issued, but probably invalid, patent and 2) successfully bringing suit to enforce one of their patents.

Which brings me pretty much full circle. I think I’m still opposed to software patents, but not for the same reason as I started out. Innovation deserves to be rewarded if that’s what the developer wants in exchange for their work. But, the nature of the software industry, the size of the players, and the ability (and desirability) of having small players appear on the scene with minimal capital counsel against allowing existing companies to lock up future development with scare tactics and large legal teams.

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