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CONTACT: Amy Smorodin
December 13 , 2006
(202) 289-8928

Software Patent Issues Best Solved by
Legal Focus
Litigation Incentives, Institutional Reforms Would Address Patent Quality

WASHINGTON D.C. – Concerns with software patents are best addressed through general reforms of the patent system rather than sector-specific solutions, explains Solveig Singleton in "Solutions for Software Patents: Notes From Under My Desk," a Progress on Point released today by The Progress & Freedom Foundation. In the publication, Singleton explains that in addressing software patent concerns, "the most effective solutions would be those that focus on improving the operation of patent courts and eliminating perverse incentives to pursue weak patent claims in court." The paper is based on remarks made at a software patent conference sponsored by MIT and Boston University.

In the paper, Singleton, PFF Senior Adjunct Fellow, describes the evolution of software patents and explains why patent law remains better suited to software then copyright protection, offering a shorter term of broad protection against copying and being technical in nature. But there are real problems with the administration and litigation of software patents. Because these concerns are not isolated to the software sector and cut across a wide variety of industries, broad reforms of the patent system as a whole best addresses issues raised with software patents.

Singleton lists four categories of solutions for software patent concerns in order of precedence:

  • Litigation-Focused Changes: At present, firms often settle even weak patent claims because of the high cost of litigation. Therefore, weak patents are not easily screened out in the courts. Policies to provide incentives to litigate weak claims include fee shifting, eliminating heightened damages for willful infringement, and lowering the standard for when an invention is considered obvious.
  • Institutional Competition: Introducing an element of competition into the patent appellate courts by designating additional federal circuits to hear patent appeals or by privatizing the Patent and Trademark Office, would push these institutions to improve their performance in answering hard questions in the development of patent law.
  • Internal PTO Reform: Internal reform should first address accountability mechanisms, such as measures of patent quality and examiners' performance.
  • Business Cooperative Solutions: Private sector efforts, such as accruing libraries of prior art, are of limited potential because individual businesses have limited incentives to participate. Also, without changes in litigation incentives and institutional structure, private efforts would face perverse incentives.

Out of the four solutions to software patent concerns outlined above, litigation-focused changes should be the priority. The healthy software sector in the U.S. points to problems with litigation cost, as opposed to product development or market entry. Therefore, reform focused on litigation would be most effective in addressing concerns over software patents. Once this reform is established, institutional restructuring and internal reform could be effective in further addressing patent quality and other issues.

Singleton's paper, "Solutions for Software Patents," is available on the PFF website.

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.



The Progress & Freedom Foundation