Wednesday, July 19, 2017

Liscow & Karpilow on Innovation Snowballing and Climate Law

Patent scholars are often skeptical of the government "picking winners," but in Innovation Snowballing and Climate Law, Zach Liscow and Quentin Karpilow (Yale Law) argue that the government should target specific technologies to address social harms like climate change.

It is well known that green technologies present a double externality problem. Both innovation and environmentally friendly goods have significant positive spillovers (and thus will be undersupplied absent government intervention), and the problem is magnified for environmentally friendly innovations. The standard policy solution is to correct each externality, such as through carbon taxes (or cap and trade) and innovation subsidies (e.g., patents, grants, and R&D tax incentives).

Liscow and Karpilow argue that this approach misses the dynamics of cumulative innovation. We know that innovators stand on the shoulders of giants, but Innovation Snowballing describes recent research on how innovators "prefer to stand on the tallest shoulders in order to get the quickest, largest financial returns." Specific "clean" technologies (like solar) thus need a big push to snowball past "dirty" technologies (like fossil fuels):

Thursday, July 13, 2017

Judge Dyk on the Supreme Court and Patent Law, with Responses

Judge Timothy Dyk of the Federal Circuit has long welcomed the Supreme Court's involvement in patent law—see, e.g., essays in 2008 and 2014. In a new Chicago-Kent symposium essay, he states that he "continue[s] to believe that Supreme Court review of our patent cases has been critical to the development of patent law and likewise beneficial to our court," such as by "reconciling [Federal Circuit] jurisprudence with jurisprudence in other areas."

Four pieces were published in response to Judge Dyk, and while Michael previously noted Greg Reilly's argument that the Supreme Court does understand patent law, the others are also worth a quick read. Tim Holbrook (Emory) argues that some of the Court's interest reflects "suspicion about the Federal Circuit as an institution" but that the result is "a mixed bags" (with some interventions having "gone off the rails"). Don Dunner (Finnegan) is even more critical of the Supreme Court's involvement, arguing that "it has created uncertainty and a lack of predictability in corporate boardrooms, the very conditions that led to the Federal Circuit's creation." And Paul Gugliuzza (BU) argues that "the Supreme Court's effect on patent law has actually been more limited" because its decisions "have rarely involved the fundamental legal doctrines that directly ensure the inventiveness of patents and regulate their scope" and because its "minimalist approach to opinion writing in patent cases frequently enables the Federal Circuit to ignore the Court's changes to governing doctrine."

Monday, July 3, 2017

USPTO Economists on Patent Litigation Predictors

Alan Marco (USPTO Chief Economist) and Richard Miller (USPTO Senior Economist) have recently posted Patent Examination Quality and Litigation: Is There a Link?, which compares the characteristics of litigated patents with various matched controls. The litigation data was from RPX, the patent data was from various USPTO datasets, and the controls were either chosen randomly from the same art unit and grant year or were chosen with propensity score matching based on various observable characteristics. They are interested in whether examination-related variables that can be controlled by the USPTO are related to later litigation, and they conclude that "some examination characteristics predict litigation, but that the bulk of the predictive power in the model comes from filing characteristics."

Marco and Miller report that patents filed by small entities are more than twice as likely to be litigated than those filed by large entities, and patents with longer continuation histories and application pendency are also more likely to be litigated. Government-interest patents and foreign-priority patents are much less likely to be litigated than other similar patents. Other characteristics that indicate higher probability of subsequent litigation include having more independent claims and shorter independent claims (proxies for broader patents), being allowed by examiners with signatory authority, not being allowed on first action, having more IDS filings or examiner interviews.