The Patent Eligibility Restoration Act

by Stephan Kinsella on October 15, 2024

Whenever there is “bipartisan” legislation in Congress, hold to your wallets, for they are coming after it.¹ Or, in this case, they are going to make the patent system worse, i.e. “improve” it. Don’t you know, it’s “broken.”

IP law almost never gets better. It always gets worse. The copyright terms keep getting extended—from 14 years extendable once, to life of the author plus fifty years, now life of the author plus seventy years.² There is constant agitation to make the copyright fair use defense harder to invoke, constant calls to expand copyright to cover links, newspaper story headlines, and so on. Patent law almost never gets better, except as the random happenstance of court interpretations of its nonobjective and vague standards, e.g. in eBay Inc. v. MercExchange, L.L.C., the 2006 case that mercifully made it somewhat more difficult for patentees to get injunctions against their victims. Something patent terrorists continually whine about.³ The only meaningful improvement in the entire history of US patent law—from 1790 to now—that I am aware of was an expansion of prior user rights in Obama’s 2011 America Invents Act.⁴ But this was pretty minor. Okay there was one other minor one too, that I mention below. The other changes were all window dressing, though you would not know it from the caterwauling of patent shills who freak out about every tiny change to avoid real change ever being considered. They want to keep that Overton window small.

As I’ve pointed out before, Radical Patent Reform Is Not on the Way, despite whining by patent shills like this:

The U.S. has the best patent system in the world. What I’m afraid of is that they are about to throw the baby out with the bathwater.… The new rules are radical. The new legislation is radical. They will cause fewer patents to be issued.

As I pointed out there, pending legislation would not have made any significant improvements, why which I mean weakening patent law. Real reform, short of abolition, would include things like this:

Reduce the Patent Term
Remove Patent Injunctions/Provide Compulsory Royalties (the eBay did make injunctions harder to obtain but this was not the result of legislation but just judicial construction of the existing patent statute)
Add a Royalty Cap/Safe Harbor
Reduce the Scope of Patentable Subject Matter
Provide for Prior-Use and Independent-Inventor Defenses (Obama’s patent reform did do this, somewhat)
Instantly Publish All Patent Applications
Eliminate Enhanced Damages
Add a Working/Reduction to Practice Requirement
Provide for Advisory Opinion Panels
Losing Patentee Pays
Expand Right to Seek Declaratory Judgments
Exclude IP from Trade Negotiations
add a fair-use defense
reinvigorate the reverse doctrine of equivalents defense⁵

But no, you won’t see any of this, except the one exception in 234 years that patent law was improved by the AIA expanding the prior user defense. Okay, there was one other time, when medical groups like the the American Academy of Ophthalmology opposed doctors being able to get a patent on a surgical technique, or method, since it would be unethical for the doctor to came up with an improved surgical technique to prevent another doctor from using the best method available for his patents. This led Congress in 1997 to add § 287(c) to the patent statute (Title 35, U.S.C.), to prevent such surgical procedure patents (but not medical device patents) from being asserted against other doctors. They are still technically infringing the surgical procedure patent when the performed the claimed procedure, but they have no liability.⁶

But except for one minor expansion of prior user rights in the AIA (which is limited, and which only helps other independent inventors, not the public at large, which can still be terrorized and extorted by the patentee) and one narrow limitation of doctors’ ability to assert medical procedure patents against other doctors, legislation never makes patent law better, and usually makes it worse.

It is true that one other change the AIA made was to change the US patent system from one where the first inventor to invent would win in the case of two similar inventions, to first inventor to file. This was a change, and one that the patent shills whined about at first (it took away some of their business since it made the law clearer and eliminated the lucrative but now defunct practice of “interferences“), but a meaningless one since it only changed who would be the plaintiff extorting innocent victims. From their point of view, it doesn’t matter whether inventor-patentee A or B is the one suing them. (Naturally, pro-patent “libertarian” Congressman Thomas Massie is worked up about this irrelevant change!)⁷

Anyway, patent law almost never improves, except when the courts change the way they had been interpreting its non-objective, arbitrary, and vague boundaries.

Now Congress has bipartisan legislation pending to “improve” patent law—you can guess this means “make it worse”: the S.2140 – Patent Eligibility Restoration Act of 2023, designed to fix, in the words of one patent shill,⁸ problems caused by “judicially-created exceptions to patent eligibility plaguing the country.” (The mostly pro-patent Federalist Society is soon having a FedSoc Forum on this issue.)⁹ (Oh my god I just realized the FedSoc forum features the buffoon patent shill Gene Quinn! He’s the idiot who gave this retarded argument for patents: “Thank goodness the Swiss did have a Patent Office. That is where Albert Einstein worked and during his time as a patent examiner came up with his theory of relativity.” )¹⁰

He’s referring to rulings like Mayo v. Prometheus (2012) and Alice Corp. v. CLS Bank International (2014), which made it somewhat harder to get patents on certain inventions that the court held were not “patent eligible”—e.g., a method for giving a drug to a patient, or abstract ideas merely implemented on a computer. Ominously, the draft law states: “All judicial exceptions to patent eligibility are eliminated.” Anything that makes it easier to obtain a patent is bad, not good.

Of course every single Congressman and senator who is in office now or who has ever lived supports patent and copyright law, so confused and misguided is everyone about the utter incompatibility of IP monopoly privilege grants and genuine property rights. (Yes, this includes “libertarian” leaning Thomas Massie, who is a huge patent shill.¹¹ I am sure Justin Amash was pro-patents and IP in general, and I have never heard Ron Paul ever oppose patents—after all, “it’s in the Constitution” derp derp.) So it’s no surprise such a bill has sponsors, such as Congressmen Kevin Kiley (R-CA) and Scott Peters (D-CA) and Senators Thom Tillis (R-NC) and Chris Coons (D-DE), patent fascists all. Anyway, thus spouts our good little ignorant fascist patent shills:

Today Representatives Kevin Kiley (R-CA) and Scott Peters (D-CA) introduced the Patent Eligibility Restoration Act (PERA), bipartisan legislation to restore patent eligibility to inventions across many fields. This bill affirms the basic principle that the patent system is central to promoting technology-based innovation.

But it’s not. Patent law distorts and impedes innovation. It makes us all poorer. There is no evidence that it does what the retarded Founders thought it would do—promote the progress of the useful arts (inventions). As early as 1934, Arnold Plant expressed deep skepticism of patents: speaking of the patent system, he wrote:

the science of economics as it stands to-day furnishes no basis of justification for this enormous experiment in the encouragement of a particular activity by enabling monopolistic price control.

As noted in an exhaustive 1958 study prepared for the U.S. Senate Subcommittee On Patents, Trademarks & Copyrights, economist Fritz Machlup concluded:

No economist, on the basis of present knowledge, could possibly state with certainty that the patent system, as it now operates, confers a net benefit or a net loss upon society. The best he can do is to state assumptions and make guesses about the extent to which reality corresponds to these assumptions. … If we did not have a patent system, it would be irresponsible, on the basis of our present knowledge of its economic consequences, to recommend instituting one. (( Fritz Machlup, An Economic Review of the Patent System 79-80 (1958), c4sif.org/resources. See also my posts “The Overwhelming Empirical Case Against Patent and Copyright” and “Legal Scholars: Thumbs Down on Patent and Copyright”. ))

And the empirical case for patents has not been shored up at all in the last fifty years. As George Priest wrote in 1986, “[I]n the current state of knowledge, economists know almost nothing about the effect on social welfare of the patent system or of other systems of intellectual property.”¹²

More recently, Boston University Law School Professors (and economists) Michael Meurer and Jim Bessen conclude that on average, the patent system discourages innovation. As they write: “it seems unlikely that patents today are an effective policy instrument to encourage innovation overall” (p. 216). To the contrary, it seems clear that nowadays “patents place a drag on innovation” (p. 146). In short, “the patent system fails on its own terms” (p. 145).¹³

And in a more recent paper, economists Boldrin and Levine state:

The case against patents can be summarized briefly: there is no empirical evidence that they serve to increase innovation and productivity, unless the latter is identified with the number of patents awarded – which, as evidence shows, has no correlation with measured productivity. This is at the root of the “patent puzzle”: in spite of the enormeous increase in the number of patents and in the strength of their legal protection we have neither seen a dramatic acceleration in the rate of technological progress nor a major increase in the levels of R&D expenditure – in addition to the discussion in this paper, see Lerner [2009] and literature therein. As we shall see, there is strong evidence, instead, that patents have many negative consequences.¹⁴

But let’s ignore the overwhelming evidence against the empirical case for the patent system because, you know, the Constitution says Congress can enact patent law, and you know, the “bill affirms the basic principle that the patent system is central to promoting technology-based innovation.” You know–it “affirms” the “principle”! So it must be true.

Our stupid Congresscritters go on:

“The U.S. has one of the most restrictive patent systems in the world due to confusing rulings from the Supreme Court. The Patent Eligibility Restoration Act will allow American inventors to patent a wider variety of inventions that foreign nations, like China, already allow their own innovators to patent,” said Rep. Kiley.

Yay! Let’s be more like China. Hey, I thought China was commie and didn’t believe in or protect IP!¹⁵ I thought they were always “stealing” our IP!¹⁶

“This will spark economic growth, create jobs, and provide significant technological advancement for all Americans.”

Uh, see above. There is no evidence for this. Patent law reduces innovation and impoverishes the human race. As I wrote elsewhere:

It is obscene to undermine the glorious operation of the market in producing wealth and abundance by imposing artificial scarcity on human knowledge and learning…. Learning, emulation, and information are good. It is good that information can be reproduced, retained, spread, and taught and learned and communicated so easily. Granted, we cannot say that it is bad that the world of physical resources is one of scarcity—this is the way reality is, after all—but it is certainly a challenge, and it makes life a struggle. It is suicidal and foolish to try to hamper one of our most important tools—learning, emulation, knowledge—by imposing scarcity on it. Intellectual property is theft. Intellectual property is statism. Intellectual property is death. Give us intellectual freedom instead! (( “Against Intellectual Property After Twenty Years: Looking Back and Looking Forward,” in Stephan Kinsella, Legal Foundations of a Free Society (Houston, Texas: Papinian Press, 2023), Part IV.E. ))

But let’s go on:

“For more than two centuries, a U.S. patent has guaranteed innovators that their inventions will be protected from theft.

Actually, morons, patent infringement is not theft. Even your own Supreme Court knows this. As it wrote in Dowling vs United States, in a case discussing whether “copies” could be regarded as “stolen goods” under the law, it held held that they could not. Instead,

interference with copyright does not easily equate with theft, conversion, or fraud. The Copyright Act even employs a separate term of art to define one who misappropriates a copyright: “[…] an infringer of the copyright.” (( Stop calling patent and copyright “property”; stop calling copying “theft” and “piracy”. ))

Patent and copyright infringement are artificial offenses created by statute, and are not theft. They are not “piracy” or “knocking off” or “taking”. It’s simply “infringement,” a made-up non-crime, completely malum prohibitum, not malum in se.

Our patent system has helped the U.S. become and remain the innovation capital of the world,” said Rep. Peters.

Bullshit. No evidence for this. See above.

“A series of Supreme Court decisions has muddied the waters of patent eligibility, threating American innovation and our economy,” said Senator Coons. “I’m glad the House has introduced a companion bill to my bipartisan Patent Eligibility Restoration Act with Senator Tills, and I urge Congress to pass this legislation so we can clarify the types of inventions available for patent protection to help maintain America’s global innovation leadership.”

Well, unfortunately patent law does nothing but impede, reduce, and distort innovation, all at a staggering cost.¹⁷ Get rid of it, don’t make it worse, you fools!