Patent Reform

A consortium of technology companies is lobbying Congress for patent reform. According to the article, the two main things the consortium is asking for are (1) adopting a "first to file" rule to replace the current "first to invent" rule, and (2) messing around with remedies and damages for patent infringement. This should be interesting.

The first to file rule has always been controversial. Everywhere else in the world where patent rights are recognized, if two people invent the same thing and one files a patent application first, the first filer gets the patent. Period. In the United States, the second filer can get the patent if he shows that he actually invented the technology before the first filer. Needless to say, this creates a lot of complications in patent cases and a lot of money for law firms.

The attraction of the first to invent rule is that it bestows the benefit of intellectual property ownership on the first person to actually develop the subject matter of the property. This is a nice idea in theory, but there are at least two reasons for adopting the first to file rule. First, it would bring us in line with the rest of the civilized world in terms of the way we treat intellectual property (something that's increasingly important what with the international trade and all).

Second, and more philosophically, it would implement a more progressive construction of intellectual property rights. Intellectual property lacks the trappings of traditional property, and the precise contours of IP rights have always been hard to define. For this reason, the government has always been deeply involved in creating and interpreting IP rights. Imposing a first to file requirement would make it clearer that IP rights are government-created, and one of the steps in securing those rights is asking for them in a timely manner.

Regarding remedy reform, this is definitely something that courts have had problems with. The eBay case didn't do much to clarify the injunction standard, and the Blackberry fiasco, which ended in settlement, didn't create any helpful legal precedents. Interestingly, the article claims that Congress' interest in this field was prompted in large part by fear among Congress members and staffers that their Blackberrys would go dark. This may be a needlessly self-interested justification for taking up legislation, but ideally the experience will lead lawmakers to take a more down-to-earth view of patent enforcement.

Disarming the Private Attorney General

Apparently other states are considering legislation akin to California's beloved Proposition 64, which limits the private enforcement of unfair competition laws by placing various factual and administrative hurdles in the way of class action suits. The main drag is the requirement that the private litigaent suffer an actual injury in reliance on the alleged unfair business practice (usually a misrepresentation), prohibiting private attorneys from suing on behalf of the general public.

Okay, the whole point of class action litigation is that no individual has suffered enough of an injury to merit an individual lawsuit, so this focus on injury is absurd. Proposition 64 was sold to California voters as a way to prevent mom and pop restaurant owners (who are just trying to feed their families, just like you and me) from being nailed by meritless shake-down lawsuits. An admirable goal, to be sure. But there are ways to do that without preventing corporate abuses by large companies to go unpunished by a disinterested state attorney general. Class action plaintiffs' lawyers generally aren't the best that the Bar has to offer. They're often not the consumer crusaders thay make themselves out to be. Of course they're in it for the contingency fees. But empowering private lawyers to sue on behalf of the general public is a perfectly legitimate way to enforce consumer protection laws, particularly where the state government can't be counted on to do it its damn self.

Unfortunately when you put the howling masses in charge of legislation you get black-and-white, overbroad policies like this. Hopefully if other states do take on tort reform the legislatures will be able to come up with more nuanced provisions.

Circuit Split

Dang.* Apparently the Ninth Circuit had 73 male clerks and 73 female clerks last year.

Against the grain, as always.

* By the way, I'm becoming increasingly frustrated with the number of VC posts devoted to Republican talking points. I also never read the comments. I think the best way to read that particular blog is by focusing on posts from the Brothers Volokh.