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Comment by nfc | Hacker News Reader

Wouldn't it make sense for small companies to commit their patents to a mutual "patent fund" that would protect them in case they are sued?, are there legal reasons why this has not been done?

An ideal version of this mechanism would work like this: once you commit a patent to the fund you can not use it offensively in the future (to avoid worsening the problem), but you'll be protected by the "patent fund" when someone sues you. The sum of the patents of lots of small companies could quickly be enough to deter most suers that are not patent trolls.

Disclaimer: I'm not american so my knowledge of the patent system is quite superficial, perhaps a similar mechanism already exists?

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I think when smaller companies have patents, they tend to be closely related to their core business, and they have them precisely in order to use them 'offensively' - or, in other words, to protect their core business from companies that want to 'copy' them.

In principle, that is sort of what the patent system was intended for. (I still don't agree with it, but that's another story).

I don't think smaller companies can be offensive with patents, because they don't have the money to litigate. Maybe your definition of small and mine are different, though. I'm thinking of < $10M/yr. In that case, I don't believe a company of that size would have the resources to go after alleged infringers.

Yes, I suppose for this system to work companies'd have to commit some non core patents, that would be the "price to pay" for the insurance the system provides.

I've never applied for a patent, mostly for ethical reasons since I don't believe in the system the way it's structured right now but it has always seemed to me that getting a few patents was not so difficult for someone with a bit of "innovation capacity".

We could call it the "Defensive Patent License", if it's not already taken [0].

[0] http://www.defensivepatentlicense.org/

One problem with this is that most companies that are small today hope to be large tomorrow. "Small" is not an intrinsic characteristic of most companies (at least most companies that would have patents), so there is little incentive for them to band together based on that characteristic.

I know of several small companies that manufacture small devices/goods that no longer patent anything at all because the patent itself becomes a high speed copy process for competitors to steal the idea and make their own copy. Not having the large bank accounts or the lawyers needed to fight these types of thefts they have decided to spend the money to continue to evolve the product(s) faster than the competition reverse engineer them and put them in to production themselves.

You are right that there's a tradeoff. I'd say the tradeoff is not so bad if at least they get to be large before being sued out of existence.

A way to address some of the problems that would arise for the protection of IP (what happens if google starts tomorrow the service disregarding the non enforceable patents?) would be to not commit to the patent fund patents that are both highly innovative and/or key to the business model, while committing the rest.

Anyway what I wanted was to start a discussion on it not detail all the possibilities of a rather complex topic in a small HN comment ;)

That is kind of like http://www.openinventionnetwork.com/community-of-licensees/

That could work. You could also establish a committee to resolve disputes between two or more members. Of course, members would have to agree by the operating rules of the organization, and would have to agree to abide by the decisions of that organization.

Hell, you could get the larger organizations involved -- they couldn't sue the hell out of each other, but they could protect their intellectual property.

We could call it "The United States Patent Office" or something like that. Is the domain name available?

The idea is to have alternatives to work around the flaws of the system.

The difference between using what the state provides and creating such a "patent fund" is that with the former you just accept the status quo. It's obviously an option to accept it and go for it alone, I'll not take that from you but perhaps for many small companies it would be better to not go at it on their own.

I totally agree. I think your idea is really pragmatic and we should probably execute it. I just wish the current system, which we're deeply invested in, would work for the good of the country (which is the point of having a government and offices like USPTO).

Patents are offensive only. Even if you have a patent over your product, you can still infringe another patent.

The reason big companies want patents "as defense" is because they can use those patents against a competitor if the competitor sues.

A good example is Apple v. Samsung. They both asserted many patents against each other.

Patent trolls, however, don't infringe any patents. You can't hit them back.

But there's really no point in a patent if it can't be used offensively - by which I assume you mean filing a suit on the grounds of infringement of the patent. If you waive that right, then everyone is free to infringe your patent with impunity.

The point of the patent would be to counter-sue in case of a lawsuit being initiated against them.

That said, I'm not sure it'd help much, since AFAIK patent trolls don't have much to get sued for.

It certainly wouldn't protect against patent trolls, more against the big companies the article is talking about. I don't know enough about the american patent system as to know whether such a system would help much with those.

Companies large and small do this all the time. They're called cross-licensing agreements.

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