When Software Patents Go Bad - Page 2

'Overworked and Underpaid'
"But, patent examiners at the USPTO are overworked and underpaid. And, because of that, we are seeing some very bad and overly-broad patents being issued. If you could do a turnover of every rock on the planet to find prior art, I would say about 40-50 percent of all patents issues would be overturned. That is obscenely high," Colson said.

"If people spend a lot of money to get a patent, shouldn't I have some sort of protection? In a sense, I guess people should really be suing the patent office for issuing patents that are utterly unenforceable," said Colson, who served as an IP lawyer for many years before taking the reins at Rochester, N.Y.-based IP.com.

To immediately clean things up at the USPTO, Colson recommends patent examiners get more easy access to the right prior art. "If it's true that there is prior art that predates by more than a year of the date of filing, that's no use if the examiners don't see it. "In the case of ActiveBuddy, the world came together to find prior art but, in most cases, patent disputes have only one plaintiff and one defendant."

And because the average legal fees to attempt to enforce a patent is in the range of $1.5 million, Colson said it is imperative that the government-run USPTO can be relied upon to issue valid and enforceable patents.

"The only issue about patent infringement should be: did the person infringe or not? Nothing else. But, you do have to worry about a lot more because of the problems at the USPTO," he added.

Reform is Coming
For its part, the USPTO has basically admitted operations are in a mess and has embarked on an ambitious "21st Century Strategic Plan" to clean things up.

"The House and Senate Appropriations Committees' reports for fiscal 2002 expressed dissatisfaction with past USPTO performance regarding key components of USPTO operations: management of workload, patent quality, patent and trademark pendency times, failure to improve retention and productivity in the examiner workforce, the need for improved training, and the need to invest in e-Government" according to the USPTO Web site.

"While the current processes have served us well, there are numerous shortcomings that, if unchanged, will make it difficult to deliver the quality patents and trademarks in a timely manner as needed to promote expansion of business opportunities, stimulate research and development, and expand American businesses globally. The new strategic plan will transform the USPTO into quality driven, highly productive, and cost effective organization," it added.

In the meantime, Colson's IP.com is moving full-steam ahead with plans to build a repository to secure innovation and prior art claims. The company, which launched in 2000 with $7 million in seed funding from Mellon Ventures and Manning & Napier, provides a Web-based portal which allows users to publish and authenticate inventions, in lieu of filing for patents.

"Basically, our authenticated system means the published work can be used to either prevent patents from issuing or to defend yourself if you get sued by someone with an overly broad patent," he explained.

Defensive Publishing
IP.com has already snagged big-name clients like Motorola , General Electric and Eastman Kodak for its defensive publishing platform. Instead of patenting every aspect of its daily inventions, the companies use the IP.com platform to publish prior art. "They patent a lot but they also publish a lot and they publish with us specifically so that patent examiners will find prior art before issuing patents," he said.

Private inventors can also post work for $155 per publication, Colson said, boasting that IP.com has expanded its defensive publishing customer base to 250 corporate accounts in less than three years.

The company also authenticates private documents relating to intellectual property claims. "It's basically the same as defensive publishing, except that this is not searchable or available to the public. It is to help inventors prove they invented something at a certain time. And, the key is that we safeguard and authenticate the documents in a rock-solid database," Colson said.

Full-fledged reform at the USPTO might be a full five years away, but in the meantime the grumbles about incompetence in the process have reached a crescendo. The controversy over ActiveBuddy's patent is just the tip of the iceberg.

EDITOR'S NOTE: This report was modified from its original form to delete references to a cease and desist order from ActiveBuddy against an IM bot developer. ActiveBuddy said it had never sent a C&D notice related to its patent, describing the letter as a "complete fraud and fabrication." The company said it was investigating the fake letter, which purports to have originated from ActiveBuddy's mail server.