Glyn Moody - European Unitary Patent Court and software patents
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Glyn Moody - European Unitary Patent Court and software patents

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Patents are not granted in Europe for computer programs "as such". But they are granted for the mysterious "computer-implemented inventions". Put that together with the imminent Unitary Patent Court ...

Patents are not granted in Europe for computer programs "as such". But they are granted for the mysterious "computer-implemented inventions". Put that together with the imminent Unitary Patent Court that will allow companies in 25 EU countries to be sued using just a single patent, plus a shift from national jurisdictions to one overseen by the software patent-friendly European Patent Office, and you have a recipe for disaster. US-style patent trolls, which have cost the US economy hundreds of billions of dollars (details included) are probably coming to Europe soon.

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Glyn Moody - European Unitary Patent Court and software patents Presentation Transcript

  • 1.    Danish software patents: to be or not to be? glyn moody
  • 2.    inventive scarcity  patent law was framed in a world with few inventors, and few inventions  monopoly was offered  to attract foreign master craftsman  to make technical knowledge freely available after monopoly expired  to stimulate local industries  to encourage more inventions
  • 3.    inventive abundance  today, we live in an abundance of inventors and invention, as the creaking patent system shows  in 2012, 469,000 patent applications filed with USPTO; 258,000 in Europe; 11,000 in Denmark  in March 2013, USPTO *granted* 6,000 patents in a single week  "30% of US patents are for things that have already been invented."
  • 4.    benefits & costs of patents  Bessen, Neuhäusler, Turner and Williams (2014)  looked at costs and benefits to US companies of patents 1984-2009  total benefits - $385 billion  total costs (e.g. litigation) - $538 billion or $1,490 billion  order of magnitude: $1 trillion  Bessen et al. looked at how things developed over time
  • 5.    something happened  source: Bessen et al. (2014)
  • 6.    enter the patent trolls  Non-Practising Entities (NPEs)  typically buy patent portfolios  demand licences/threaten to sue Practising Entities (PE)  have no products, can't be sued  no independent invention defence  mount a defence in court costs $2- 5 million fees; most settle  1984-99: PE - 88%; NPE - 12%;  2000-09: PE - 39%; NPE - 61%
  • 7.    super patent troll  Intellectual Ventures  founded by Nathan Myhrvold  owns 35,000 patents  raised $5.5 billion from Microsoft, Intel, Sony, Nokia, Apple, Google, Yahoo, American Express, Adobe, SAP, Nvidia, and eBay  computer-related patents cases  1984-99: PE - 17.2%; NPE - 5.4%  2000-09: PE - 12.1%; NPE - 32.6%
  • 8.    software patents  obvious – Wang's overlapping frames/windows  trivial – Amazon's 1-click  ridiculously broad  E-Data: ”system for reproducing information in material objects at a point of sale location” (1985)  generic e-commerce sites sued  lack of well-defined boundaries  intentionally blurred by lawyers
  • 9.    the key problem  abstract – patent of maths/idea  often impossible to code around  copyright is more appropriate: protects only the particular expression, not the general idea  uniquely, software is patentable *and* copyrightable - anomaly
  • 10.    software patent infringement  software depends on thousands of components/"inventions"  more complex it becomes, more "inventions" it depends upon  patents are monopolies to exclude others from using an invention  if you can't code around it, you only need one "infringement" to block entire program/product
  • 11.    patent litigation  source: Techdirt (2010)
  • 12.    smartphones: just the start  2012: $20 billion spent on smartphone patent litigation and purchase in previous 2 years  2011: Apple & Google spent more on patents than on R&D  US smartphone patent thicket  2000 - 70,000 relevant patents  2012 - 250,000 relevant patents  smartphone is phone+computer  Internet of Things: thing+computer
  • 13.    US software patents  “If people had understood how patents would be granted when most of today’s ideas were invented, and had taken out patents, the industry would be at a complete standstill today.”  “some large company will patent some obvious thing” and use the patent to “take as much of our profits as they want.”  Bill Gates (1991)
  • 14.    EU software patents  EPC (1973), Article 52:  "(1) any inventions, in all fields of technology, provided that they are new, involve an inventive step and are susceptible of industrial application."  the following in particular shall not be regarded as inventions:  "(2c) schemes, rules and methods for performing mental acts, playing games or doing business, and programs for computers"
  • 15.    "as such"  "Paragraph 2 shall exclude the patentability of the subject- matter or activities referred to therein only to the extent to which a European patent application or European patent relates to such subject-matter or activities as such."  "as such" opened up huge loophole for European software patents
  • 16.    computer-implemented inventions (CII)  computer-implemented invention  "one which involves the use of a computer, computer network or other programmable apparatus, where one or more features are realised wholly or partly by means of a computer program."  in 2002 30,000 had already been issued in the EU
  • 17.    *not* software patents  transforming file names (EP0800142)  tabbed software palettes (EP0689133)  generating buying incentives from cooking recipes (EP0756731)  pay per use (EP0538888)  online sales (EP0803105)  etc. etc. etc.
  • 18.    European Directive on CII  Directive on the patentability of computer-implemented inventions (2002)  Denmark was against, ignored by European Commission  6 July 2005: European Parliament voted against it by 648 to 14  in favour: Microsoft, IBM, Hewlett-Packard and European Patent Office (EPO)
  • 19.    European Patent Office  membership not coincident with EU  38 member states, not 28  supranational body enjoys extra- territoriality  offices are "inviolable": local authorities can only enter with permission of EPO President  funded through its services  vested interest in widening scope of patents, incl. plants, GMOs - and software patents
  • 20.    Unitary Patent  EPO handles  European patents and European patents with unitary effect (Unitary Patents)  European patents can also add unitary effect afterwards - open floodgates of CII patents  national patents remain an option  race to the bottom  companies will choose whichever gives widest monopoly
  • 21.    Unitary Patent Court (UPC)  Court of First Instance in France, Germany, UK  local courts in Denmark, Sweden  Mediation in Portugal, Slovenia  Court of Appeal in Luxembourg  EUCJ for "rulings on Union law"  key: national courts play no part  Spain, Italy, Bulgaria, Poland all have reservations
  • 22.    Polish concerns  Unitary Patent fees may be higher than national ones  could lead to flood of foreign patents applying in Poland  more licence fees for Polish cos.  more litigation against Polish companies, in other EU courts  could see national patent court fading away; loss of autonomy, loss of national culture
  • 23.    something rotten?  Unitary Patent will bring more, worse software patents to Denmark  Denmark will lose its autonomy: must accept EPO's patent rulings  Denmark sceptical about Directive on the patentability of CII  wise to be sceptical of UPC  adopt the Polish plan: before ratifying, wait and see if Unitary Patents are better
  • 24.    that is the question glyn.moody@gmail.com @glynmoody on Twitter +glynmoody on Google+ opendotdotdot.blogspot.com