Thursday, August 13, 2015

Patents and the Federal Circuit

All you need is your own imagination
So use it, that's what it's for
Go inside for your finest inspiration
Your dreams will open the door
--Madonna

Article suggests that the establishment of the Federal Circuit Court of Appeals has been a primary factor in the issuance of patents, particularly low quality ones, over the past few decades.

In 1982 Congress consolidated all patent appeals into a single appeals court--the Federal Circuit. This has provided a forum for holders of low quality patents to 'troll' innovations being brought to market and sue those producers for infringement. The Federal Circuit has even undermined Supreme Court rulings to favor patent interests. Studies suggest that patent holders are 3x more likely to win on appeal after district court rulings of invalidity since 1982.


The patentee friendly Federal Circuit forum has motivated an explosion of low quality patents and patent-related litigation.

While constitutional patent-granting authority was meant to spawn innovation, it is hard to argue that the current system promotes rather than hurts creativity and productivity improvement. Entrepreneurs are more reluctant to bring new products to market and must spend considerable resources researching and battling the thicket of low quality patent claims.

Of course, because patents and other intellectual property rights grant holders legal monopolies over production, it should have been expected that original laws and intent would be twisted to favor the status quo rather than competitively driven productivity improvement.

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