Efficient Interaction Among Inventing Firms and Manufacturers Needed
WASHINGTON D.C. - Reform of the patent system should facilitate flexible arrangements between specialized "invention shops" and downstream manufacturers, argues James V. DeLong in "Patent Reform & Industrial Structure," a new Progress on Point released today by The Progress & Freedom Foundation.
The rapid pace of technological innovation is leading to increasing specialization in the field of inventing, DeLong notes. Patents establish legal, enforceable rights in intellectual creations, so they are an indispensable interface between specialized inventors and the companies that develop and market the products, just as property rights in physical goods are essential to a functioning market.
However, the patent system has developed some severe malfunctions, and the downstream companies, which are the loudest voices for reform, have valid complaints. Precisely because of the increasing importance of the "interface" function of patents, the malfunctions are stressing the industrial system.
DeLong argues that patent reforms must not hinder the shift towards separation of invention and manufacturing, if that is a more efficient structure, and that reform should concentrate on three areas:
- Radical change is needed to shorten the length of the patent process. If shorter time standards cannot be achieved by the USPTO, the system should be privatized. "It takes 14 months to get a first office action," said DeLong, "but in that time the average patent gets about three days of attention. Why not give it those three days within the first two weeks after filing? Maybe FedEx should take over the patent office."
- More attention should be paid to reforms that improve the availability of information, such as standardized language, improved databases, better access to prior art, and improved analytical tools.
- The standard of nonobviousness should be revised (as is before the Supreme Court in KSR), and problems with claims construction should be addressed.
DeLong concludes that, "In analyzing reform proposals, the guiding principle should be to get beyond the concept of patents as an arcane legal framework and view them as a crucial part of the industrial and business system, a tool for enabling flexible and varied business arrangements."
DeLong's paper, "Patent Reform & Industrial Structure," is available on the PFF web site. For more information, contact Amy Smorodin at 202-289-8928 or asmorodin@pff.org.
The Progress & Freedom Foundation is a market-oriented think tank that studies the digital revolution and its implications for public policy. It is a 501(c)(3) research & educational organization.
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