Inadvertent Argument Against Peer-to-Patent

Lawrence B. Ebert
date: Thursday, June 28, 2007

In an article titled "The Patent System is Not Broken" (18 Intellectual Property & Technology Law Journal 10 (December 2006)), Patrick Doody wrote of some patent system reformers:

"The critics consist of a tightly knit group of university professors and non-patent attorneys who are critical of the patent system and who favor weakening patent rights. The critics publish countless articles every year and repeatedly cite to one another's work, if not simply to repeat it or provide a synopsis thereof in a different venue, which gives the impression that there are numerous opinions consistently critical of the patent system. This coterie of most frequently published patent critics is so insular and close-knit that no effective independent review of their work is likely."

Footnote 1 of Doody's article included text about the book by by Adam Jaffe and Josh Lerner, INNOVATION AND ITS DISCONTENTS: HOW OUR BROKEN PATENT SYSTEM IS ENDANGERING INNOVATION AND PROGRESS, AND WHAT TO DO ABOUT IT (Princeton Press, 2004) and states "most articles critical of the patent system published since this book represent synopses of the book in one form or another."

It is correct that certain academics rely on the Jaffe/Lerner book for broad-brush indictments of the patent system. For example, in an article in the Berkeley Technology Law Journal in 2005, four academics, including a professor of law at Yale University, asserted that "Strong patents--particularly in the aggregate--have been shown, both theoretically and empirically, to reduce both innovation and welfare," relying for authority on a working paper by Lerner and on Innovation and Its Discontents. [20 Berkeley Tech. L.J. 1031, 1044]. The idea that intellectual property represents a harm to public welfare is mentioned in 20 Harv. J.L. & Tech. 49 , with Innovation and Its Discontents cited as part of "a broader stream of scholarship." Interestingly, one notes that Innovation and Its Discontents has received favorable notice in a more general context, for example getting a strong endorsement in a paper entitled "Stem Cell Research and Embryo Cloning: Involving Laypersons in the Public Debates," (39 New Eng. L. Rev. 527) including text --Lerner told the New York Times that he felt that "the patent system, 20 years after the reforms, [is] mired in 'the land of unintended consequences."'--

This use of Innovation and Its Discontents in a more general context merits exploration. Ironically, the use of Innovation and Its Discontents in two papers pertaining to the peer-to-patent context illustrates both Doody's general point that academics are simply parroting conclusions of Jaffe and Lerner without independent analysis AND that such repetition illustrates aspects of the downsides to peer-to-patent itself.

In a paper titled "Peer to Peer Meets the World of Legal Information: Encountering a New Paradigm," 99 Law Libr. J. 365 (related to a symposium concerning the thoughts of Robert C. Berring), authors Ethan Katsh and Beth Noveck wrote in paragraph 8:

In their recent book, Innovation and Its Discontents, [FN5] Adam Jaffe and Josh Lerner document many patents that are anything but novel and nonobvious, such as patent number 6,368,227 for "Method of Swinging on a Swing" awarded to a five-year-old boy (subsequently cancelled). [FN6] Or patent number 6,574,645, a patent on a method for drafting a patent. [FN7] The patent awarded to Smucker's for the crustless peanut butter and jelly sandwich is, by now, legendary. [FN8] Jaffe and Lerner describe a patent sought for expirationless options thirty years after economists won the Nobel Prize for the same idea. [FN9]

Footnote 7 states: U.S. Patent No. 6,574,645 (issued June 3, 2003) ("Machine for Drafting a Patent Application and Process for Doing Same"), noted in JAFFE & LERNER, supra note 5, at 144.

In turn, footnote 5 states: --ADAM B. JAFFE & JOSH LERNER, INNOVATION AND ITS DISCONTENTS: HOW OUR BROKEN PATENT SYSTEM IS ENDANGERING INNOVATION AND PROGRESS, AND WHAT TO DO ABOUT IT (2004), reviewed by Rochelle Cooper Dreyfuss, Pathological Patenting: The PTO as Cause or Cure, 104 MICH. L. REV. 1559 (2006) (book review).-- Footnote 5 would suggest to the reader that the authors Katsh and Noveck are aware of the presence of book reviews of the Jaffe and Lerner book.

The text in paragraph 8 of "Peer to Peer Meets the World of Legal Information: Encountering a New Paradigm" is not unrelated to text in a previous article by Noveck, "PEER TO PATENT": COLLECTIVE INTELLIGENCE, OPEN REVIEW, AND PATENT REFORM, 20 Harv. J. L. & Tech. 123, 130-131 (2006):

While patents have provided an incentive for national competitiveness and stimulated investment in new technologies, [FN35] there is a general consensus that the crab is traveling backwards: many perceive the system to be broken. At a minimum, an issued patent must set forth an invention that is novel, useful, non-obvious, and described with enough specificity to be practiced. [FN36] Yet of the two million patents in force in the United States, [FN37] many do not qualify. The patent (page 131) awarded to Smucker's for the crustless peanut butter and jelly sandwich is, by now, legendary. [FN38] Adam Jaffe and Josh Lerner regale the reader in their book Innovation and Its Discontents [FN39] with many more horror stories of patents that are anything but "non-obvious" -- for example, a patent awarded to a five-year-old boy for "Method of Swinging on a Swing" [FN40] and a patent on a method for drafting a patent. [FN41]

Footnote 41 notes: Machine for Drafting a Patent Application and Process for Doing Same, U.S. Patent No. 6,574,645 (filed Feb. 19, 2002).

The multiple publication of examples allegedly showing patent grants on obvious subject matter relates to Doody's comment: "if not simply to repeat it or provide a synopsis thereof in a different venue." However, there is something more afoot here.

First, Jaffe and Lerner did not talk about U.S. 6,574,645 on page 144 of Innovation and Its Discontents. That illustrates that neither the authors of "Peer to Peer Meets the World of Legal Information: Encountering a New Paradigm" nor the editors/cite checkers at the Law Library Journal were checking the citation.

Second, and of greater significance, Jaffe and Lerner did talk about a different patent on page 144 of Innovation and Its Discontents in the context of asserting a failure of the USPTO to adequately analyze prior art. Specifically, Jaffe and Lerner alleged on page 144 that the USPTO did not consider prior art in granting U.S. Patent No. 6,049,811 which is directed to a "Machine for Drafting a Patent Application and Process for Doing So." Jaffe and Lerner alleged that the disclosure in the '811 patent was anticipated by a paper by workers from Hitachi published in 74 JPTOS 315.

In 2005, before either paper by Noveck, J. Steven Rutt had written in NANOTECH AND THE PATENT SYSTEM: A REVIEW OF INNOVATION AND ITS DISCONTENTS, 2 Nanotechnology L. & Bus. 111, 113 (2005), a book review of "Innovation and Its Discontents" available in both LEXIS and Westlaw which appeared before the review of Professor Dreyfuss:

The Innovation authors, however, utterly fail to discuss the seminal point of whether the Hitachi prior art teaches this required feature of the invention. Hence, on first glance, even without studying the '811 patent and the Hitachi prior art more carefully, one skilled in patent law would find it is not so unreasonable that the '811 patent claims issued as a patent are novel over the prior art. (…) Moreover, the Innovation authors fundamentally miss the important point that it is quite possible that the Hitachi prior art is merely cumulative to the prior art which was cited, including the background discussion in the '811 patent, which is fairly extensive. In other words, the Innovation authors attempt to characterize the '811 patent as an embarrassing example of PTO carelessness, but even a brief look at the issue by a trained patent attorney confirms that it is not so embarrassing after all.

This was a rather strong published warning to all legal academic researchers that the story advanced by Jaffe and Lerner on the USPTO's "failure to recognize prior art" might not be correct. But Noveck did not mention Rutt's published work in later relying upon and citing to the story of Jaffe and Lerner.

Had Noveck stopped to independently analyze the assertion by Jaffe and Lerner (and to identify the patent which Jaffe and Lerner actually discussed on page 144 of Innovation and Its Discontents), Noveck might have recognized that the Jaffe and Lerner story on the '811 patent was without merit. The failure of the Hitachi work to address what is claimed in the '811 patent has been shown in It's Time for Patent Reform, IBM-Style, Patent Reform: Jaffe/Lerner and Kappos, and in L. B. Ebert, GETTING THE PATENT REFORM WARS BACK ON TRACK, full paper, Spring Seminar 2007, LAIPLA, SDIPLA, OCPLA June 8, 2007. [As an aside, Noveck in 20 Harv. J. L. & Tech. 123 in the year 2006 cites to the 97% grant rate number of Quillen and Webster: "At present, even though an over-whelming percentage of patent applications are granted (with some estimates as high as ninety-seven percent), …" without any mention of the prior published papers discrediting the 97% number and the methodology associated with it, which prior papers are summarized in 88 JPTOS 1068.

Directly to the point, the 97% estimate relies on the assumption that a patent cannot issue on both a parent application and a continuing application derived therefrom, which assumption would be known to be untrue by anyone familiar with prosecution at the USPTO.

The episode with the two papers by Noveck illustrates one foreseeable problem with peer-to-patent. Competitors of the patent applicant are likely to furnish only prior art adverse to the applicant (to advance their own agenda), without discussing either the validity of that cited art or the possibility of intervening art discrediting the cited art. In the above-discussed case, the story advanced by Jaffe and Lerner on page 144 of Innovation and Its Discontents was cited for its truth without an independent analysis of its actual accuracy or a mention of an intervening article which discredited the story advanced by Jaffe and Lerner. Jaffe and Lerner's discussion of the '811 patent falls into the category of an urban legend. Another foreseeable problem with peer-to-patent is that the procedure, if generally adopted, would benefit patent system players with more resources over independent inventors operating with marginal resources. Peer-to-patent will be gamed in a predictable way to the disadvantage of predictable victims.

R. Carl Moy discussed the '811 patent in the following way in 28 Wm. Mitchell L. Rev. 1047 (2002): At least one patent has even issued for an improved process of writing a patent application.[U.S. Patent No. 6,049,811] One commentator has analogized the situation to "Alice in Wonderland." [Merges, As Many as Six Impossible Patents Before Breakfast: Property Rights for Business Concepts and Patent System Reform, 14 Berkeley Tech. L.J. 577, 578 (1999), wherein the title of Merges' paper derives from text in Alice in Wonderland, but the '811 patent is not discussed by Merges.]

Painting something with the "Alice in Wonderland" brush is great sport. The association was used in Nelson v. Adams, 529 U.S. 460, 468 (2000): "Procedure of this style has been questioned even in systems, real and imaginary, less concerned than ours with the right to due process."

In the present matter of the '811 patent, one might well question whether the discussion by non-patent attorneys Jaffe and Lerner of an alleged failure to identify prior art initially discussed by non-patent attorney Aharonian and later repeated by others, none of whom ever analyzed whether there was indeed a failure to find relevant prior art, might not be something out of Alice in Wonderland. It's certainly not the stuff Congress should be relying upon to fashion patent reform.

Previous postings on IPFrontline relevant to the above include: Getting the Patent Reform Wars Back on Track, Is the Jaffe/Lerner Analysis of Patent Law Correct?, and The Right Focus for Patent Reform.