New Patent Paper of Note

With the Senate scheduled to vote today on a landmark patent reform bill, this new paper, by David Abrams and Polk Wagner, is especially timely:

“Even as we stand on the cusp of the broadest set of changes to the US Patent Law in two generations, virtually no empirical analysis has been conducted on the impact of the primary components of the proposed reforms. Until now. In this paper we investigate the expected effects on patenting behavior of the major change in the America Invents Act of 2011: a shift in the patent priority rules from the US’s traditional “first-to-invent” system to the dominant “first-to-file” system. This is a deeply controversial change: Opponents argue that first-to-file disadvantages small inventors and leads to lower quality patents. Those in favor emphasize administrative simplicity and the cost savings of first-to-file. While there has been some theoretical work on this topic, we use the Canadian experience with the same change the US is considering as a natural experiment to shed the first empirical light on the question.

Our analysis uses a difference-in-difference framework to estimate the impact of the Canadian law change on small inventors. Using data on all patents granted by the Canadian Intellectual Property Office and the US Patent and Trademark Office, we find a significant drop in the fraction of patents granted to small inventors in Canada coincident with the implementation of first-to-file. We also find no measurable changes in patent quality. The results are robust to several different specification checks. While the net welfare impact that can be expected from a shift to first-to-file is unclear, our results do reveal that, contrary to the conventional wisdom, the rule change is not free — it is likely to result in reduced patenting behavior by individual inventors.”

I’ve only skimmed the paper, but found it both provocative and readable.  Check it out!  (And if you want to get far into the weeds, read the comment thread about the paper on PatentlyO.)

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8 Responses

  1. A.J. Sutter says:

    Any lawyer with experience of prosecuting patents or working in a tech company could have predicted that. And in fact they did — this was a common topic of discussion around the time of the 1995 GATT Uruguay Round patent law changes. Most individual inventors don’t have the assets to file quickly, and some companies, like one I used to work for, made it a point to have enough experienced lawyers so as to be able to turn on a dime. Nonetheless, it probably depends on the art area. It will be harder for individuals to win patents in, say, semiconductor processing and search engines. But kitchen implements, pooper-scoopers, methods of swinging on a swing, etc. will probably be less affected.

  2. Dave Hoffman says:

    Hi AJ,
    I’ve heard that kind of comment in response to lots of empirical scholarship — but isn’t the response that empirical work illuminates specialist knowledge so that others can learn from/respond to it.

  3. A.J. Sutter says:

    Actually, Dave, if you want to illuminate specialist knowledge, why not just talk to practitioners?

    There was some other paper a few years ago that Polk Wagner and a collaborator wrote about patent portfolios that included strong claims of originality, as if they had discovered something about patent strategy. In reality, practitioners had discovered it decades earlier (like, by the time of the Haber-Bosch patents before the First World War). That sort of empirical scholarship is merely re-inventing the wheel and getting tenure for it — awarded by faculty who are all too often just as ignorant of real-life business practice as those who are promoted.

    If you hear this comment often, check it out — there may be something to it.

  4. Dave Hoffman says:

    But AJ, most people don’t have the ability to talk to specialist practitioners — that is, most people who aren’t already lawyers or highly-placed executives. Scholarship that describes the world as lawyers know it is actually quite valuable in reducing (somewhat) the value of the bar’s monopoly and thus increasing access to legal services, broadly defined.

  5. A.J. Sutter says:

    Sorry, it’s a noble try, but I don’t buy that argument. #1: Legal scholars do have the ability to talk with “specialist practitioners” and business executives. They just rarely do so. #2: The audience for legal scholarship is even more elite and specialized than that group of practitioners and execs.

    And #3: Don’t confuse scholarship that reaches conclusions that are obvious to practitioners with scholarship that “describes the world as lawyers know it”. The greater part of that scholarship describes the world in ways that are entirely unrecognizable to lawyers (especially when it comes to patents), and/or make claims of originality that are somewhere between risible and outrageous. (A business analogue, and no joke: a few years ago Harvard Business Review ran a feature article about behavioral econ and product price points that recommended you sell more when you use prices like $X.98 or $Y95 than if you use the next highest round number. A “secret” known to retailers for what? centuries, at least.)

  6. Dave Hoffman says:


    1. I said “most people”, not “most legal scholars.” The point being that we ought to be thinking about people w/out access to top flight legal counsel when we imagine what the conventional wisdom looks like.

    2. Sometimes the audience for legal scholarship is small. Sometimes it isn’t. I prefer pieces that take things that small groups of people know and try to illuminate them for larger groups of people. If no one reads what I’ve written, that’s sort of my fault for being a bad or unclear writer. But that doesn’t mean it was a foolish project.

    3. I don’t quite get the last point. Of course, overclaiming novelty and an emphasis on counterintuitiveness is a disease that affects many disciplines, not just law. (Heck – other disciplines have whole journals about this problem.) I’m not a patent lawyer, so I don’t know if they’ve described something that was obvious to most patent lawyers. It wasn’t obvious to me as a finding. That seems like a good day’s work.

  7. A.J. Sutter says:

    Dave, the point still remains that legal scholars could quite easily talk to legal professionals and businesspeople in industry, and find out what is obvious to them. And BTW my original point was that those folks could easily have told you what the impact would be on the people without access to top-flight legal counsel (which coincides with first hypothesized mechanism at pp. 46-47 of the paper; see also the comments of a Canadian patent attorney in the PO thread).

    The paper scores even lower on the “world as lawyers know it” scale for measuring patent quality by the number of words in the first claim, with more being better. Lesson #1 about writing claims is to remove all unnecessary words; a patent on the wheel might have had as claim #1 simply: “A rounded member capable of being rolled.” (As if quality can be determined by any such rule of thumb anyway, without understanding the patent landscape at the time of the filing and the state of the art.) So not only does the paper describe something obvious to most patent lawyers, but something that will strike them as absurd, too.

  8. A.J. Sutter says:

    PS: I followed up on a link in the PO thread, and found a 1964 patent by the chemistry Nobel laureate and famous “element hunter” Glenn Seaborg, #US 3156523 (assigned to the US government). Its first claim, in its entirety: “1. Element 95.”