Tuesday, May 26, 2009 - The Progress & Freedom Foundation Blog

Expedited Patent Examination for Green Technology

With little fanfare, the U.K. Intellectual Property Office ("UK IPO") has moved patent applications covering so-called "green" technologies to the head of the queue for expedited examination. (Tip to Intellectual Property Watch for picking up on this.)  As a result of the priority, the UK IPO expects patents to issue in nine months, rather than in the ordinary two or three years.  Is this a good idea for the United States?  Probably not.  It isn't clear to what degree this "fast track" will actually result in faster or greater commercialization of green technologies.  Moreover, while faster patent examination is a laudable goal for any and all patent applications, greater resources are needed in the U.S. Patent & Trademark Office ("US PTO") for other -- arguably more important -- matters, such as reexamination of already-issued patents.

How exactly will the UK's fast track work?  The UK IPO has made some details available.  "Accelerated search and/or examination of the patent application will be made available to any patent applicant who makes a reasonable assertion that the invention in the patent application is one which has some environmental benefit."  See Press Release.  The applicant chooses how things can be sped up, by choosing any or all of the following:  to accelerate the search for prior art, to combine the search and examination (as opposed to searching first and examining later), to publish the patent application early, and/or to accelerate the patent examination.  See Green Channel for Patent Applications.  More details for the UK's fast tracks for patent examination -- for green and other technologies -- are available in a short PDF guide.  That PDF guide expressly refers to use of the fast track as "jump[ing] the queue."  Guide at 3.

I have previously written in this blog about green technologies and the danger of adopting an overbroad definition.  Compulsory Licenses & Green Technology.  The UK scheme unquestionably suffers this defect.  By permitting anyone who can make a "reasonable assertion" that its product or process "has some environmental benefit" to jump the queue, the UK is inviting expedition for a substantial percentage of applications.  Manufacturers bear the cost for their raw inputs (whether material, energy, or water) and seek to improve methods of production to make their products cheaper.  Accordingly, one would expect many patentable industrial methods to be green in one way or another.  Any technology that is smaller than its predecessor has "some environmental benefit" as it uses less material.  The UK's low burden of proof for applicants to demonstrate real environmental benefit leaves the system at risk of being heavily overused.  Were it adopted in the United States, it would swamp an already overburdened PTO.

Let's assume that the patent bureaucrats could devise a more circumscribed definition of green technology.  For the sake of argument, let's pick very a narrow class of technologies, maybe those that recapture carbon dioxide from the air.  This enables us to avoid the overbreadth problem.  Beyond the fact that we are focusing on a specific technology, we are doing so with regard to a pollutant whose costs are, by and large, not borne by the polluters; the polluters' ordinary method applications would therefore not address that pollutant.  Would queue jumping in such narrow circumstances be good for the United States?  I still don't think so.

The purpose of the fast track ought to be two-fold:  to create research-related incentives (that result in patents) and to accelerate the commercialization of patented technologies.  The UK system seems unlikely to fulfill either of these purposes.

First, it is not clear that faster patents will lead to more research.  It would be better to fund directly the research we want (or provide tax credits) than to prioritize examination of some patents ahead of all others in the hope that doing so will shift research in some way.

Second, there is little if any relationship between a fast track for patents and their actual commercialization.  (Though I do not agree with some of his recommendations, for a very thoughtful overview of legal scholarship on commercialization of technologies, see Ted M. Sichelman, Commercializing Patents, forthcoming Stanford L. Rev.)   Entities that practice their inventions -- the General Electrics, Intels, Toyota's and so forth -- don't get much from a fast track.  They'll build what they will and will have patent rights covering novel aspects of their manufacturing and other business practices.  The argument for a fast track and commercialization would have to be that certain non-practicing-entities (maybe an inventor in a garage, maybe a university engineering department) would be more easily able to license their inventions to those who can practice the inventions.  But patent applications can be licensed, as can technical know-how, in the absence of an issued patent.

So the practice of a great idea need not be held up pending the issuance of a patent.  What is held up, potentially, is the ability of non-practicing-entities to seek royalties from the General Electrics or Intels of the world who independently create the same technologies.  (This gets into the so-called patent-troll problem, where a subset of non-practicing entities endeavors not to practice its own inventions or to have the public learn from its patent applications.  Instead, the goal is to extract royalties without actually advancing the state or practice of technology.)   But that is not a laudable goal for jumping the queue, as it does not speed up practice of the technology, but merely speeds up resolution of legal rights to some profits from the technology.

So the benefits of queue jumping are dubious.  But the drawbacks are clear, at least in the United States.  The US PTO is overwhelmed by too many patent applications and too few resources or examiners.  Nowhere is that more true than for reexamination of issued patents.  For a discussion of patent reexamination in the United States, see my blog post Toothless Changes for Post-Grant Review.  Notwithstanding federal law that requires that patent reexaminations jump the queue, the reexamination of some issued patents can take a decade.  On balance faster reexamination of patents is more important than faster initial examination.  For one, reexaminations often occur after a patent is litigated in the courts, and the pendency of reexamination will ordinarily result in a disruption of the judicial process.  For another, patents being reexamined are necessarily practiced and controversial -- otherwise no one would bother to petition the US PTO to initiate a reexamination.  By contrast, many if not most patents are never practiced.  By one measure, 40% of patents are abandoned after only eight years.  William M. Landes & Richard A. Posner, The Economic Structure of Intellectual Property Law 311 (2003); see also Sichelman, supra (citing a survey of British industry that suggests that 40% of the survey respondents' patents are uncommercialized); see generally my blog post China & Compulsory Licenses for "Unworked Patents" (noting the lack of a requirement under U.S. law that patentees practice their patents).  Thus, resources devoted to faster examination of green patent applications will often be wasted as the issued patents will not be practiced.

It is dubious that the US PTO has any resources to spare, but if it does, such resources should be used to facilitate reexamination -- which Congress has already declared to be more important than other patent examinations -- and not to benefit some nebulous idea of green technology.

posted by Sidney Rosenzweig @ 2:16 PM |