Tim Richardson

Melbourne, Australia

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Patent trolls and property-rights goblins: What Harry Potter can teach us about patents and property rights

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Imagine that the only people who could drive cars were those who built them with their own hands. That’s the logical territory of many attacks on patent “trolls”.

I strongly dislike the term "patent troll". According to what I read, a "patent troll" is someone who owns a patent, and enforces it without being the inventor of the patent, or without using the patent in production. Ownership without invention or production is what makes them a “troll” as opposed to a "morally legitimate" owner of the patent.

As this NPR transcript (When Patents Attack) explains, a troll is a scary creature who makes you pay to cross a bridge. It's taken for granted that the troll did not build or buy the bridge. The troll is a thief and a bully; dim-witted and seeking to get its way by violence. The troll arrives at the bridge, chases off or kills the real owners, and then extracts tolls from travellers seeking to cross the bridge. The term is derogatory, although apparently not libellous. I'll go out on a limb here: the troll's behaviour is not acceptable in civil society.

But in all the discussion of "patent trolls", I haven't come across the accusation of stolen patents (or murder). The inventor and the “troll” mutually entered an agreement to transfer ownership. Transfer of property rights happens all the time. Someone may construct a shop, and then sell it to someone else, who then charges rent to a tennant. Such transfers of exclusive access to property are common. No one calls the new owner a “property troll” because they neither built nor occupy the shop. The new owner is simply an intermediary who is good at managing property, just as the original builder is good at financing and managing construction, and just as the tenants are good at running a shop. I'd guess that in Australia and America, this accounts for the vast majority of commercial property.

Harry Potter fans may recall the attitude of goblins to things they make (such as the sword of Gryffindor). Apparently, even though goblins make things on order from wizards and take payment for these objects, they don't really believe that ownership passes out of the hands of the craftsman (craft-goblin) who made it. They don't really recognise that the party they sold the object to can transfer owership to someone else. You show me a patent “troll”, and perhaps in the mirror I'll show you a property-rights goblin. I detect some kind of belief that only the original inventor has a right to enforce patents ... some kind of moral right that can not be transferred to a third party. Well, that sucks if I happen to be the owner of IP I'd like to sell to someone (be it a patent, a song or a story). If I can't fully transfer my right to someone else, then you're taking control (or partial control) of my IP. Without compensating me for it.

Patent recognition and enforcement may be badly broken when it comes to software. But a patent is a legal right to intellectual property, and it should be fully transferrable, just like a $100 bill is transferrable. If that patent is not fully transferrable, then it's worth less. By reducing the value of a patent, you are stealing from people who own patents, which includes inventors. 

For the record, I think the USPO was right when it didn't recognise software patents because they are the same as attempts to patent algorithms. As a computer science graduate, I know there are extremely strong grounds for considering software to be a mathematical expression (and mathematics can't be patented). So it is software patents which are broken. The problem is not IP owners exerting their rights. The problem can't be allowing an IP owner to sell or licence IP to a third party. Interference in property rights is a huge step. The patent system may be a mess, but interfering with property rights is a nuclear option. Fixing software patents solves the problem. Trying to stop patent trolls as a alternative would not fix software patents, and would have disastrous side-effects.

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Last Updated on Tuesday, 09 August 2011 22:25