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Patent wars … we get the war, but what about the patents?

It can be hard to know where the next bit of hypercharged rhetoric will come from. fotoforlizzie

If you believe the hype, the “patent wars” are well and truly underway.

Google announced last week it will buy Motorola Mobility to get access to 15,000 of the handset manufacturer’s patents and HTC, Apple, Samsung and others have been suing one another over alleged breaches of patents.

But we should question fashionable rhetoric about “patent wars”, including claims that litigation by major corporations over patent rights is unprecedented, is grossly pernicious or an indication that the patent system is broken.

The first question here being: what are patents?

Simply, patents are a legal mechanism for the encouragement of innovation. The aim is to benefit society by providing an incentive for invention and investment, with inventors (and financiers) gaining exclusive commercial rights to a particular innovation for 20 years.

In return for those rights, society gains access to information about the innovation, offering a springboard for future development.

Some patents are trivial, even laughable, such as the horse-drawn amphibious taxi or umbrella hat that have amused several generations of law students.

Other patents are fundamental, covering the pharmaceuticals and electronics that we take for granted.

Australian patent law forms part of an international regime – currently the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) – and has done so since before federation.

Our participation in that regime is a reminder that globalisation isn’t new: trade, investment and research have been taking place across borders for more than a century.

Individual researchers and institutions may choose not to seek patent protection, instead placing discovering in the public domain and forgoing revenue opportunities.

But that choice is likely to be increasingly difficult, as an ageing population results in increased welfare spending at the expense of government support for pure and applied research.

Disagreements about patent law and about the best ways to foster creativity date from the time of the Tudors.

Laments about the wickedness of investors, the avarice of inventors and abuse by patent lawyers are perennial. They are a feature of the ongoing culture wars that are an inescapable and unresolvable aspect of modernity.

There is then, in this sense, nothing new.

In Australia

Australian law is predicated on the notion that individuals and corporations will resolve disagreements through negotiation or the courts.

While the news has been full of tech giants suing one another of late, litigation does not signify an imminent collapse of patent law. Rather, it’s a sign of business as usual.

In fact, despite increased reports of litigation of late, Australian courts, government agencies – such as the Productivity Commission and Australian Competition & Consumer Commission – and independent bodies such as the Intellectual Property Research Institute of Australia have not identified an explosion in patent litigation.

They have not expressed fundamental concern that major holders are abusing the law through coercive litigation against potential market entrants or through egregious rent-seeking.

Businesses are instead doing what businesses do: seeking to maximise their advantage in a competitive environment.

To paraphrase Shakespeare, the fault is with ourselves – the shape of business and innovation in liberal democratic states – rather than with patent law.

It is often a long and expensive journey from the lab bench to the blister pack containing lifesaving medications or the must-have tool such as a mobile phone.

Contrary to popular images of an Einstein-like figure with a succession of eureka moments in the garage or garden shed, most innovation is an industrial process that involves a hard grind and teams of innovators rather than individuals.

(Thomas Edison, often characterised as the archetypal inventor, in reality mugged for the cameras while hundreds of his employees got on with research behind the scenes.)

Numerous organisations have invented brilliantly but languished commercially, despite their patent portfolios and the very best patent lawyers money could buy, because their executives were inept or self-involved and their production or after-sales service was poor.

Tech companies

From that perspective, we might be cautious in accepting recent alarms about Google’s much-publicised acquisition of Motorola patents, hyperbole about gene patenting or expressions of “declinism” such as claims China is out-patenting (rather than merely out-manufacturing) the US.

Some patents are junk. They have no real value or won’t stand up if contested in court. Many of the patents in corporate or private equity portfolios won’t be commercially significant and won’t be used to stifle competition.

Yes, China’s patent registrations are rising but yes, analysts also question the credibility of many registrations.

Unlike death and taxes, success with a patent isn’t a certainty. In looking beyond the headlines and soundbites we would do well to remember that patents do not last forever – they have a finite life.

Today’s patent is next year’s footnote, not fetters permanently restricting research and public benefit.

Unfortunately, that reality doesn’t make for good headlines.

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