Feb 112011

Economics has been a very sexy topic lately.

In the global deflated state we find ourselves in, everyone seems to be focusing on getting back on track economically. One important way to do this¬† is through innovation. This is the crux of what most people are talking about, at least in the U.S. government: How do we maintain our edge on the rest of the world? How do we encourage businesses to grow? How do we plan for the future generation? President Obama recently answered these questions: “The first step in winning the future is encouraging American innovation.”¬† The answer is to innovate, now.

Patent Systems can Encourage Innovation.

A country’s patent system can help spur innovation by giving inventors rewards for innovating. But patents translating into innovation is not a guarantee. Finding the right balance for society is key. Relevant questions include: Why does the patent system exist? How long does it have experience? How much participation is there among its citizens? The United States is set up perfectly to have a flourishing patent system. As far back as 1787, the document that would ultimately give Congress the authority to promote the progress of science and useful arts was adopted. The system Congress created shortly thereafter to implement this charge has been fine-tuned for a long time. There are more patents filed in the United States than any other country. The U.S. should be doing very well to spur innovation using patents.

How the U.S. is doing at its center of innovation–the Patent and Trademark Office.

That being said, the PTO is a fairly weak government agency that is resistant to change. The PTO has no substantive rulemaking authority and courts don’t have to give any weight to its policies. See Merck & Co. v. Kessler, 80 F.3d 1543, 1550 (Fed. Cir. 1996) (stating that, because the Patent Act “does not grant the Commissioner the authority to issue substantive rules,” “the rule of controlling deference set forth in Chevron does not apply”). Also, even though there exists a statutory presumption of validity, courts often times don’t give granted patents any deference. E.g., Ass’n for Molecular Pathology, 702 F. Supp. 2d 181, 221 (S.D.N.Y. 2010). It seems likely that structuring the PTO differently could do more to encourage innovation at the PTO. If the courts gave more deference to the expertise of the PTO, the agency could craft better policies and be overall more efficient. The PTO, with David Kappos at the helm, has done a lot of innovating. From introducing multiple pilot-programs to concretely reducing the backlog of patents, the PTO has improved substantially. That being said, could it do more? What grade would you give the PTO? What things would you change?

The world is not very round, especially in China.

Our society is becoming increasingly global just as international protection is becoming crucial. On Wednesday, WIPO released the results of international patent filings for 2010. Overall, there was 4.8% growth from 2009. The number of U.S. fillings declined for the third straight year, but there was remarkable growth in Northeast Asia. China experienced 56% growth in foreign filings. Looking forward, the United States still remains the leader in foreign filings and looks to maintain its lead. That being said, it must increase the number of foreign filings unless it wants China to overtake it the same way China overtook South Korea most recently. With an increase in the number of international patents filed, here’s to hoping that 2011 will continue with growth in innovation.

 Posted by at 10:41 am