on February 9th, 2010

Dear Colleagues

As engineering professionals we should all be passionate about protecting our hard won designs and intellectual property from the pirates and less than scrupulous commercial denizens. There are many disturbing examples of ‘rip-offs’ occurring regularly around the globe – with some countries more guilty than others.

Despite what you think this is a topic relevant to us all. Whether an electrician or chief engineer, you work with intellectual property on a daily basis. And it is this intellectual property which is closely linked to your (and your firm’s) skills and expertise. It is, therefore, vital that you know when you are creating something worth patenting or copyrighting and, on the other hand, are aware of the possibility of infringing on someone else’s patent.

Patenting an idea gives you, the inventor, a 20-year monopoly, during which time you are free to maximise your intellectual property in the marketplace. This requires the publication of a full and honest account of how the new product, process or material works (so that everyone can see how “you did it”). Which, I hasten to add, is not necessarily to your advantage as you now raise the flag and disclose your soul to all your competitors and pirates out there (for what may be considered “your birthright in exchange for mess of pottage”).

In order to patent your invention, it must not only be novel, but also useful and ‘non-obvious’. It is impossible to patent magic, for example, or something which defies the Laws of Nature (such as perpetual motion). Furthermore, a working prototype must be provided to the US Patent and Trademark Office (USPTO) for the patent applications which may challenge the Laws of Nature.

The challenge, at present, for the patent offices (particularly in the US) is the deluge of frivolous applications. We have the famous case of the intermittent windshield wiper operation. Perhaps in days long gone, when the wiper was powered mechanically from a vacuum in the engine, there was something massively innovative here. But with today’s technology, where electrical motors and dedicated electronics are used, it is a trivial operation within the capabilities of entry level high school students in their Design and Technology classes. Another issue for the patent offices are the aggressive lawyers who represent firms making applications with little to show. An example of a legal stoush over a patent license was when Rockwell Automation’s clients were sued (by a legal firm that had accumulated well over $400m from similar actions in the past), some years ago, over a patent for real time communication between computers – something which is done as a matter of course these days. This is not very productive for society.

 But this is not really the target for my spleen – patenting ‘business processes’ is. There are over 12,000 business processes patented annually in the USA alone (and considerably fewer elsewhere). Examples of silly business process patents include Amazon’s “one-click” and Priceline.com’s “name-your-price”. These are not stimulating innovations, but are about extracting money from innocent users and, possibly, competing firms with fairly obvious ideas.

What has become clear is that the ‘non-obvious’ part of the patent test hasn’t been applied as rigorously as before. As a result many shonky patents have been granted which act more to suppress commercial activity and competition. This may be as a result of US Patent Office understaffing, the Internet still a relatively new phenomena and other travails which have kept commercial patenting off the political radar.

Fortunately, with recent court cases, America’s Supreme Court is poised to rule for common sense – making it very difficult to get a patent for a business process. As a result, many business processes which are based around software algorithms will be affected – it will impact on software patents as well. This may encourage software programmers to seek solace in copyright which extends up to 70 years after the author’s death. Admittedly, copyright protection is very narrow in scope and can only protect against straight piracy.

Oddly enough, as an aside, very few inventions are worth patenting. My advice is to avoid the temptation to patent unless you believe you have something really worthwhile. Surveys of companies in Europe and North America constantly rate outstanding service, lead time and quality (and secrecy!) as significantly more beneficial than patents. The challenge behind a patent, other than the investment of time and the cost (they are relatively cheap actually) is the fact of disclosure. If it contains any commercial value you will immediately attract a robust horde of imitators and you will then need to defend your patent in court. This is where your real costs start.  It would appear that, in the majority of cases, the cost of litigation far exceeds any revenue made from royalties or licensing fees as an inventor. In this situation the only winner, sadly enough, is your friendly lawyer who will be delighted to go to court for you.

I can clearly remember (doesn’t this age me?) when we had the plethora of competing and definitely non-interchangeable hardware and software computer operating systems in the early eighties. At that time IBM walked away from any patenting. It produced the open source concept (well, sort of) with their initial PC, set up a standard PC and created a new industry. IBM changed the world – allowing us to interchange software and hardware with a standard PC and the market expansion was breathtaking. (Despite this, I am sure there are some who claim that the standard PC is still riddled with inconsistencies and problems).

I love H.E.Martz’s take on it all: “He who builds a better mousetrap these days runs into material shortages, patent-infringement suites, work stoppages, collusive bidding, discount discrimination and ….taxes”

Thanks to the Economist and some of their correspondents for some interesting reading on this subject.

Yours in engineering learning


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