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Patent Failure: How Judges, Bureaucrats, and Lawyers Put Innovators at Risk
Free PDF Patent Failure: How Judges, Bureaucrats, and Lawyers Put Innovators at Risk
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Review
"Honorable Mention for the 2008 PROSE Award in Law and Legal Studies, Association of American Publishers""One of Choice's Outstanding Academic Titles for 2009""James Bessen and Michael J. Meurer explode...illusions in their hard-hitting analysis of how patents perform economically. [T]his is an important book, for policymakers, lawyers, scholars and also for universities."---Fiona Reid, Times Higher Education"The U.S. patent system is not working. It stands accused on all sides of stifling innovation instead of nurturing it. [E]conomist James Bessen and law academic Michael Meurer show that the system no longer provides predictable property rights. They go on to offer solutions based on empirical evidence from history, law and economics."---Harold Wegner, Financial Times"Bessen and Meurer provide the first comprehensive review of the patent system in more than a generation, bringing together a survey of the available empirical data and a clear statement of the usefulness of and limits to the patents as property model." (Choice)"[R]eaders of Patent Failure may not be sanguine about the likelihood that Congress or other policy-makers even care about, much less rely on, empirical data to inform their decision-making. But this book successfully demonstrates that they should. Ultimately, Patent Failure is a significant contribution to the growing literature on the problems and promise of the US patent system. . . . Patent Failure rewards careful reading and is a book that cannot credibly be ignored by anyone seriously concerned about the fate of the US patent system."---William T. Gallagher, Law and Politics Book Review"[W]ell-written and well-documented book. . . . [T]heir finding regarding the profitability of patents for patenting firms is the piece de résistance."---Julio H. Cole, Independent Review"In Patent Failure, Bessen and Meurer examine the U.S. patent system's current procedural and operational shortcomings. Considering the book's titular promise to reveal the dangers posed by judges, bureaucrats, and lawyers, readers might expect an angry broadside leveled at the entire legal profession. On the contrary, Patent Failure is measured and methodical, a provocative, evidence-based book for the lawyer and entrepreneur alike. The authors are nothing if not reasonable men." (Strategy + Business)"[Patent Failure is] one of the most comprehensive empirical analyses of the patent system that has been performed in decades. Rather than piling up anecdotes of beleaguered innovators and rapacious patent trolls, Bessen and Meurer have done the hard work of collecting detailed data about the patent system. And the findings documented in Patent Failure are sobering."---Timothy B. Lee, ARS Technica"In keeping with its title, Patent Failure provides a critical assessment of the nation's patent system. The book inevitably leads the reader to ponder the value of patents as property and as gauges of economic growth."---Livinia N. Jones, Centre Daily Times
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From the Back Cover
"This is a pioneering and heroic effort to quantify the ways in which our patent system has failed to live up to its raison d'être: promoting innovation. The book will be controversial. But the authors make a forceful case that deserves to be heard."--Eric Maskin, Albert O. Hirschman Professor of Social Science at the Institute for Advanced Study and Nobel Laureate in Economics"Bessen and Meurer provide a strong, balanced empirical analysis of the real-world effects the U.S. patent system has on our twenty-first century economy. Their book is essential reading for anyone interested in promoting a patent system that truly drives innovation for the U.S. economy."--Mark Chandler, senior vice president and general counsel, Cisco Systems "Bessen and Meurer's book is grounded in both economics and the real world. It hits the right notes for scholars, lawyers, and policymakers. Timely and important, Patent Failure is the best of the books on patent reform."--Mark Lemley, Stanford University
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Product details
Paperback: 352 pages
Publisher: Princeton University Press (August 23, 2009)
Language: English
ISBN-10: 0691143218
ISBN-13: 978-0691143217
Product Dimensions:
6.1 x 0.8 x 9.2 inches
Shipping Weight: 1.1 pounds (View shipping rates and policies)
Average Customer Review:
4.0 out of 5 stars
5 customer reviews
Amazon Best Sellers Rank:
#1,265,033 in Books (See Top 100 in Books)
Bessen and Meurer argue that America's patent system is in trouble because "it fail[s] to provide clear and efficient notice of the boundaries of the rights granted." Patent litigation has exploded, they say, and the costs of the system now outweigh the benefits. Generally speaking, with the exception of the chemical and pharmaceutical industries, Bessen and Meurer don't feel the patent system does a lot of good."[I]t seems unlikely that patents today are an effective policy instrument to encourage innovation overall," they conclude. They detail several reforms to help improve notice and to "make patents work as property" again the way they claim they once did.Although the authors deal with patents broadly, the book has great relevance to digital technology policy because of their discussion of business method patents and software patents. They argue that software technology is especially prone to problems of "abstraction" and obviousness. As a result, software patenting has been a major contributor to the litigation explosion we have seen in recent years.Although I agree with their case against software patents, I remain unconvinced that the patent system is failing as badly as Bessen and Meurer claim. Nonetheless, they present a powerful case that deserves to be taken seriously. Patent Failure will have an enormous impact on these debates going forward.
The argument "Without boundaries, it ain't property" made the book for me.I'm not a patent attorney, I'm an entrepreneur always trying to improve our Internet service. What confounds me, our engineers, and our law firm is the vague language of many software patents that we can't understand.I loved the discussion of obviousness, boundaries, continuations, and abstract claims.The two downers for me were:1. The academic language. It makes you squint as if you're reading a patent application, ironic for a book suggesting claims be clear and unambiguous. Sample paragraph:"Some readers might immediately find our objective to be somewhat oddly stated or, perhaps, overreaching. The key limiting qualifier here--the limitation that makes the empirical exercise feasible--is 'as property.' At the risk of getting a big pedantic, this phrase requires more careful discussion."2. They dismiss patent trolls in a sentence or two as not a significant percentage of litigation. Um. Anyone noticing the exponential rise of defendants in patent troll cases over the last few years? Their data on trolls seemed olde.
If you wanna know the situation of the current IP system, You must read this book.
Anyone inclined to read this book should just ignore its subtitle -- "How Judges, Bureaucrats, and Lawyers Put Innovators At Risk." I can only imagine that was thrown in to make this book appeal to right-wingers. Which is really strange, come to think of it: the book is sedate, scholarly, reasoned, and exhaustive, and if anything it will appeal to readers who enjoy Larry Lessig and Richard Posner. In no way do Bessen and Meurer suggest that the system be scrapped and those "Judges, Bureaucrats and Lawyers" be thrown out. In the world Bessen and Meurer desire, "bureaucrats" will still examine patent claims; lawyers will still prepare patent applications; and judges will still hear infringement claims. Bessen and Meurer want to change policies here and there to make the system more efficient, but it will still be the same system by the time they're done.The dispute over patents has become rancorous in the era of the Internet, with lots of loud people asking that it be torn down, lots of other people claiming that the first group are unwitting pawns of big business, etc. Bessen and Meurer avoid almost all of that. Their claim is straightforward, and avoids all the parts of the debate that are unnecessary for establishing their point -- which is simply this: that as a system of property, there are certain things we should expect of a patent system. That is, just as real property gives you certain rights over, say, a parcel of land, and the right to exclude ne'er-do-wells from that land, so a patent is a legal right to exclude people from using your invention. And there are certain things that we should expect of patents, just as we would expect them from property law. First among these is notice: it should be easy to determine whether you've trespassed on my land, and just as easy to determine whether you've violated my patent.In a system where notice is working perfectly, we'd expect very few patent-infringement lawsuits. In some fields, say Bessen and Meurer, that's exactly what we see: the chemical and pharmaceutical industries have very low rates of infringement, because comparing your small molecule to a patented small molecule is easy. When the product gets more complex and abstract -- as with a computer algorithm -- deciding whether you've infringed gets more and more difficult, and the number of suits balloons.Still, if lawsuits to defend against infringement claims were cheap enough, patents would be a net economic positive: the cost of lawyers when you accidentally infringe would be less than the money you bring in from non-infringing patented technologies. By this measure, Bessen and Meurer say that patents stopped being a net economic positive -- outside of the chemical and pharmaceutical industries -- in the mid-nineties.In support of their conclusions, they use an arsenal of statistical methods based on the stock prices of public companies. Everyone knows the defects in using the stock market to infer knowledge, and Bessen and Meurer are not fools. Still, the most reliable data they could find were stock-price data, on which they conducted event studies to determine what value the market attached to particular patents and infringement lawsuits. Absent any data from lawyers or companies about how much they're charging or paying, this is probably the best one could hope for.Their second method of estimating value is to study rates of patent renewal. 20% of patents expire after four years; 21% expire after eight; 17% expire after 12; and 42% last the full 17-year term. Based on the cost of renewing, we can estimate how much the owner values the patent. Seeing that 58% of patents expire by their 12th year, and that $2,327 in renewal fees will have been due by then, we can estimate that the median patent is worth less than $2,500. Similar, but obviously more sophisticated, analyses are spread throughout Patent Failure; they constitute its bulk.Bessen and Meurer blame the decreasing value of patents on a number of different factors. One is the rise of software and business-method patents, which are inherently abstract. They give a fascinating account of the Karmarkar patent, which covers a certain interior-point method for solving linear-programming problems. Years after Karmarkar obtained his patent, mathematicians discovered that the Karmarkar algorithm was formally identical to another that had been been in wide use for years. This sort of equivalence is much more likely for an abstract patent such as one governing a mathematical algorithm, and makes knowing ahead of time whether you've infringed that much more difficult. Abstraction harms the notice function of patents, hence harms their functioning as property.They sidestep any number of other questions, such as the cost of "patenting around" -- that is, developing new technologies only because existing technologies are all patented. Adding in these costs would likely only help their case, though one would have to crank through the numbers to be sure.My only concern about this book is its subtitle. If I were to issue a second edition, I would drop the populist-sounding subtitle and rename it to what it really is: "A Calm Look At The Evidence."
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