To people who aren’t avid tech buffs, a Samsung Galaxy S II smartphone looks and acts an awful lot like an iPhone — so much so that, when California-based Apple sued the Korean firm Samsung for patent infringement, a Silicon Valley jury was likely to find for the hometown electronics maker on at least some counts. When jurors awarded Apple more than $1 billion in damages recently, the company was quick to paint the result as a victory for innovators whose hard work is stolen by others.
Yet Apple’s victory was far more resounding than the circumstances warranted. The jury upheld patents even for seemingly obvious design features — for instance, the iPhone’s rectangular shape and rounded corners. Must other companies make their phones triangular and pointy? At least in consumer electronics, the US patent system may be discouraging the kind of technological innovation that patents exist to protect.
Last year, Congress reformed the system somewhat, passing a law that should lead to the more efficient processing of patent applications. But the reform doesn’t weaken patents that never should have been issued. Further action in Congress is needed.
Patents exist so inventors can profit from their own ingenuity, rather than having their ideas stolen by others. But a patent office built for the simpler inventions of bygone centuries has struggled to find the right balance today. New discoveries need protection: In biotechnology, many lucrative drugs depend on patents for a small number of substances, and the long approval process for drugs eats up a chunk of the patent term. Yet even in that industry, there are legitimate questions over whether the US Patent and Trademark Office has been too quick to issue patents for genes and other substances found in nature.
And in consumer electronics, the situation is murkier yet. Some patents overlap with previously issued ones; others encompass broad concepts that would occur independently to other people. Even as Americans idealize Silicon Valley as a place where ideas become reality, the patent system has reached the point that almost any new concept is bound to violate some obscure existing patent. This situation can be crippling to smaller startup firms — and bewildering even to the likes of Samsung. It’s hard to see how the Silicon Valley jury concluded the firm, which has products that compete with both the iPhone and the iPad, violated a patent on a rectangular phone with rounded corners but not a patent on a rectangular tablet with rounded edges.
The US patent system may be discouraging the kind of technological innovation that patents exist to protect.
Meanwhile, to insulate themselves from overly broad patent-infringement litigation, major tech firms have been spending billions of dollars to buy up fading firms — not because those firms have valuable technologies but because the patents they own can help the acquirer fend off infringement lawsuits. Such expenditures are passed on to consumers, one way or another, and they are an unproductive use of money that could instead be spent on researching new products. But this defensive spending will only increase unless Congress rolls back the power of patents — at least those covering minor features of complex gadgets.
The Apple-Samsung case isn’t finished; the jury verdict is just the prologue to an appeals process that could take some time. Rather than sit back and watch years of legal wrangling in this and a thousand other cases, Congress needs to take another look at the issue.