Large patent holders hate this reform proposal. That’s a good sign
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It probably means that you have to escrow a provision to start such a litigation, to avoid organized bankruptcies of empty shells. If you don't have this money and nobody's willing to lend it to you, it probably means that your case has little merit.
Or you're a start-up or small business that can't afford the contingent liability of a deep-pocketed infringer's legal team. Uncapped "loser pays" clauses also have an unintended consequence of encouraging the infringer to beef up their legal team to intimidate the patent holder.
The merits of the case and the proportionality of the winning party's legal expenses are taken into account. In practice, it works, together with a couple of anti-ambulance-chasing provisions (e.g. "no gain no fee" contracts are illegal).
In my experience most judges are very reluctant to order fee shifting in the absence of a specific statute because, among other reasons, it can be grounds for a malpractice action against the attorneys.
Now, that doesn't make it a bad policy per se. It works fine in France, where the government is much more willing to enforce consumer rights using regulatory means. It wouldn't work so well in the U.S. where the government leaves a lot of that kind of enforcement to private litigation.
The very reason why we have judges, rather than only cops, is that mechanically applying rules doesn't work. In most non-trivial cases, we need a human being who defends the sometimes subtle spirit of the law. That's one of those cases.
What happens when a small inventor files for a patent dispute, and still loses due to financial muscle of the big company? This clause will just act as a deterrent for me to sue "Google/Apple" because I cannot afford to lose. They will bury me in debt if I go head against them.
Besides, you don't have to make the escrow amount arbitrarily large. If I can only afford to spend $10k on a particular patent infringement lawsuit, I'll just have to put half of that in escrow and spend the other half on my necessarily limited case. The defense can spend what they want, but they'll only be reimbursed from what's in escrow, and only if they prevail. This would be an additional burden for plaintiffs, but it wouldn't qualitatively change their decision-making process.
OT, but does anyone know if these adverts actually make money?
Basically, the trick is "weird" because it's not too positive, so as not to make it sound false and unbelievable, not negative either, and uncommon enough to attract attention and pique interest. Of course, overuse of the technique desensitizes the viewers and it will eventually fall out of favor.
Doctors actually like genuine weight loss techniques (like taking more exercise) because their use improves public health. Patent holding megacorps do stand to gain from weak patent enforcement.
More than a "right" to such, society inevitably examines and challenges its social conventions. (There are some long term patterns, but even these are not steady-state.)
Society is going to look for what works for society. If and as (over-) concentrated "ownership" increasingly holds society back...
In other words, ownership at a societal level is a useful tool, but it is not an absolute.
As just one small example, even within our "ownership" society in the U.S., we increasingly have law enforcement confiscating assets without due process whether upon real or convenient suspicion of wrongdoing (asset "forfeiture").
You own it... as long as society says you own it. One reason to use it to help promote a healthy and reasonably fair society -- it's in your own long-term interest.
Dinosaurs: Adobe, IBM, Microsoft, Qualcomm and Xerox.
vs
The New Hot Shit: Google, Facebook, Samsung, Red Hat and Yahoo.
I'm not sure who's holding the most cash, but it's certainly not an easy call.
Red Hat IPO'ed 14 years ago. Even so, it only has a market cap of less than $9B, less than 1/3 of companies like Yahoo (and 1/30th of Google's). They do some neat things in open source and virtualization, but I wouldn't call them "hot".
Innovators vs. Squatters. Isn't that the expected way this argument would shake out? Patents encumber innovation, not royalty checks.
What needs to be done is make those two things related: For example, require patent holders to declare the value of a patent on their tax filings (say, in April for the previous year), pay a 1% tax on that value, and limit any infringements damages to that value (per defendant, per year). Perhaps also make a forced "imminent domain" seizure possible by any sued part for 10x of the value.
We do not want anyone to have a patent economically worth $100K or less being able to assert it to stop production of something worth $100M or more -- and yet, the current system facilitates that (see e.g. eolas vs. ms, the xml case against microsoft, creative vs. carmack).
Once you have a "cost of carry" for patents, carrying offensive patents will become expensive enough that patent holders assign value (thus, enforceability) to patents they dim worthy.
(And no, this does not push a "small inventor" or "small patent holder" out of the game. If you have a patent worth $100M but do not have much more than $1M to enforce it, you do NOT have a patent worth $100M - litigation is going to cost you much more than that; They are already out of the patent game - so let's fix other aspects first)
1. Acquiring a patent must cost $0. -- There should be no distinction between applications, such as expedited service (which we have now). The USPTO is not a business!
2. A refundable sincerity bond is used to ensure the system is not abused. --The bond is 100% refundable, regardless of outcome. It can only be confiscated if willful negligence or fraud can be proven.
3. There should be no distinction in time frames. All patents are good for a fixed period of time and no longer. They is no renewal period or fee for such.
Can you elaborate on this? Granting a patent doesn't cost $0.
(I do like the bond idea, but even today's bad patents are generally invalidated on prior art, not on willful negligence or fraud -- I'm not sure a bond would necessarily change anything)
2. Negligence and fraud aren't problems in the patent system. What's the point of a bond against them?
3. Shorter terms are something that just about everyone supports in theory and then disagrees on in the specific discussion of: how short?