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Mises Economics Blog

Patent Rights Web Poll

July 31, 2006 12:03 PM by Stephan Kinsella | Other posts by Stephan Kinsella | Comments (8)

On a patent practitioner email list I posted the following:

It seems to me that many small/medium companies live in fear of a big patent lawsuit. Even if they had their own IP, I suspect many companies would gladly give up forever their right to sue for patent infringement, in exchange for some kind of immunity from patent liability--at least, if they could eliminate the threat of an injunction, so that the worst penalty they might face is some kind of mandatory royalty. Surely IBM et al. would not take this deal, but I bet a lot of other companies would. What do you think?

Second, in view of this, does this mean there is some kind of market for a service that would let a bunch of companies get together and "pool" their IP and have some kind of agreement (a) never to sue each other; (b) to have access to this pool of patents to countersue any company that sues any of the members.

This post drew some interest so I am doing a simple webpoll. I think the results might be interesting. (DIGG it here.)






Patent Rights

Would you give up your right to sue others for patent infringement in exchange for immunity from all patent lawsuits?




Yes
No





Comments (8)

  • Tom

  • It would be interesting to know how many people who will answer yes to the question have a patent or have a patent pending.

  • Published: July 31, 2006 12:40 PM

  • Stephan Kinsella

  • Not sure. I can tell you my company has dozens pending and over 30 patents issues and I would gladly recommend this deal.

  • Published: July 31, 2006 12:54 PM

  • Sione

  • Don't the big pharmas operate under a similar "gentlemen's agreement" already?

    Sione

  • Published: July 31, 2006 3:22 PM

  • Jon

  • Mr. Kinsella highlights an important point. There is no real way to "opt-out" of the patent system through voluntary contracts because such agreements are usually found to be illegal restraint of trade and prohibited by antitrust law. On the other hand, the fashion industry attempted to create an "opt-in" system to protect new fashion designs through voluntary contracts, and this was also found (by the Supreme Court) to violate antitrust law. So there is no choice.

  • Published: July 31, 2006 4:10 PM

  • M E Hoffer

  • Where would "trade secrets", "proprietary information" fit in this discussion.

    I know that many of my friends file for "process-wide" patents and hold the specifics in house.
    With the idea that they are not divulging: "the whole of the answer".

    I would think that there is a difference between "patents"(IP) and "trade secrets"/"Prop. info". In re: this discussion, is there? would you think so?

  • Published: July 31, 2006 7:51 PM

  • Stephan Kinsella

  • >Where would "trade secrets", "proprietary information" fit in this discussion.

    Well, I don't think they are the type of threat that patents are. So I see no special need for some special defensive measures.

    >I know that many of my friends file for "process-wide" patents and hold the specifics in house. With the idea that they are not divulging: "the whole of the answer".

    I have no idea what a "process-wide" patent is, but what your friends are doing is explicitly prohibited and means their patents are invalid because of fraud on the patent office: there is an affirmative duty for patent applicants to disclose what they consider to be the "best mode" of the invention; this is the idea behind the patent grant: the state grants you a monopoly, *in exchange for* your disclosure of an enabling description including your best mode. Those idiot inventors who hold back the best mode and file the patent without it are getting patents worth nothing.

    >I would think that there is a difference between "patents"(IP) and "trade secrets"/"Prop. info". In re: this discussion, is there? would you think so?

    This is too elementary to answer here. There are lots of sources online. Try mine at www.KinsellaLaw.com/ip

  • Published: July 31, 2006 8:24 PM

  • M E Hoffer

  • Stephan,

    Right you are. I had it backward, they were *not* filing process patents, but individual component patents. The assembly of which, to animate the process, they hold "in house" as "trade secrets", "proprietary information".

    Also, I found your website well organized, and straight-forward.

    Gracias!~

  • Published: July 31, 2006 9:19 PM

  • Steven Kane

  • If I owned a company I would take this deal in a minute. To me patents are an absurd and unecessary waste of time/energy.

  • Published: August 1, 2006 11:04 PM

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