In business, there are players with talent and there are those without talent who compensate for their lack of talent by gaming a system. In this case, it happens to be the U.S. patent system, a system which is broken.
Research In Motion, the Canadian maker of BlackBerry, settled last Friday its five-year patent dispute with a one-man Virginia firm NTP, averting a possible court-ordered shutdown of the BlackBerry system via a $612.5M payout. NTP was co-founded in 1990 by an engineer who claimed to create a system that sent e-mails between computers and wireless devices. According to NTP, RIM stole their idea. Throughout the dispute, NTP tried to play up the David vs. Goliath message in the media, because NTP was an office of two people.
Could it be more obvious that NTP wasn’t trying to build a business around its invention or licensing its invention? NTP was trying to cash in on one of many patents sitting in its arsenal.
Much like surveyors ran out across the great Western prairie and laid claim to whatever land they could grab, NTP is a firm that speculates in virtual estate. They collected broad ideas and pushed them through the docile U.S. Patent & Trademark Office. They build a catalog of patents for such things like, ‘send an email from a computer to a wireless device.’ Then they sit around and wait for someone else to develop a popular business and sick the legal dogs, claiming that sole right to the core invention in the form of a patent. And they are not alone.
The player with talent, RIM, worked to build a business. RIM demonstrated in court how their engineers created their Blackberry system in isolation. No matter. Because of the U.S. patent system the legal right for using that system belonged to NTP.
Maybe we should be doing the same thing. Maybe we should join the group of patent-mongers scrounging to gain exclusive control of what seems like a non-obvious invention today, much like downloading music from the internet was provided a patent several years ago. After all, we wouldn’t have to work at actually providing a service or growing a business, but instead wait for another fool enterprise to do all the dirty work. How about: Patent Squatters, Ltd.? First patent: receiving telephone calls through a car steering wheel. I’ll get the paperwork started.
NTP didn’t build anything. They didn’t grow anything. They didn’t spend years creating consumer value. NTP simply gamed a system.
Never one to bemoan an issue without at least trying to provide a solution, I would first start by limiting the validation of patents by stricter first use clauses. Then, I would carve out sub-industry classifications for patents, so that an invention or process wouldn’t blanket the entire universe. Finally, I would limit the life of a patent by instituting a continued use clause, so that a patent holder would have to continuously demonstrate economic gain from use of the patent.