Friday, February 12, 2016

Tim Lee: End US patent court's reign of software terror

Has the Federal Circuit patent-appeals court been captured by trolls?

Tim Lee: End US patent court's reign of software terror


"No institution is more responsible for the recent explosion of patent litigation in the software industry, the rise of patent trolls, and the proliferation of patent thickets than the United States Court of Appeals for the Federal Circuit," writes Philadelphia's own libertarian-leaning communications thinker, Timothy B. Lee, for Ars Technica here. Excerpts:

"The patent court's thirtieth birthday this week is a good time to ask whether it was a mistake to give the nation's most patent-friendly appeals court such broad authority over the patent system."

Sourcing the Adam Jeffe-Josh Lerner 2004 book Innovation and its Discontents, a techie POV critique, and Steven Flanders' more recent The Federal Circuit, among others, Lee says patent trolls have long been among us -- but that prior to the 1982 court founding, "appeals courts sided with patent holders in only 20 to 40 percent of cases," while the newly-organized court, by contrast, found for patent claimants "more than 80 percent of the time during its first year on the bench...

"As companies saw the opportunity—or the threat—posed by this newly permissive patent regime, the number of patent applications, granted patents, and patent lawsuits all began to soar.

"What explains the Federal Circuit's relentless pro-patent bias? One obvious theory is what economists call 'regulatory capture': the theory that over time, public officials will come to identify with the interest groups they are supposed to be supervising."

Lee notes scholars (and scholarly judges like Richard Posner) have begun rethinking the wisdom of having a specialty patent court. "Almost every other area of law is handled in a decentralized fashion by 12 regional appeals courts. This includes highly complex and technical subjects like copyright law and antitrust...

"Either way, breaking the Federal Circuit's monopoly on patent appeals may be the single most important step we can take to fix the patent system... Only by extending jurisdiction over patent appeals to other appeals courts that are less biased toward patent holders can Congress return common sense to our patent system."

UPDATE: I ran Lee's thoughtful polemic past Prof. Michael Carrier at Rutgers Law School in Camden. His agreed the Federal Circuit is widely viewed as more "pro-patent" than prior and other federal courts and "has played
an important role in the expansion of patent law over the past 30 years.

"But I might part ways modestly" with Lee "on the issue of causation, blaming the court for all the patent maladies today," given "the complexity" attendant on all things patent.

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PhillyDeals posts interviews, drafts and updates that Joseph N. DiStefano writes alongside his Sunday and Monday columns and ongoing articles about Philadelphia-area business.

DiStefano studied economics, history and a little engineering at Penn. He taught writing and research at St. Joe’s. He has written for the Inquirer since 1989, except when he left a few times to work at Bloomberg and elsewhere. He wrote the book Comcasted, and raised six kids with his wife, who is a saint.

Reach Joseph N. at, 215.854.5194, @PhillyJoeD. Read his blog posts at and his Inquirer columns at Bloomberg posts his items at NH BLG_PHILLYDEAL.

Reach Joseph N. at or 215 854 5194.

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