Reasons For Low-quality Patent Filings And Ways To Avoid Them
Quality >>> Quantity!
But is it followed in the Patent filing process?
Why is the number of low-quality patents increasing?
Why is almost every company in the race to file as many patents as possible?
Before answering all such questions let’s first understand the meaning of this “low-quality patent”.
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A low-quality patent threatens to slow the pace of technological progress and is a target for patent trolls because they often have broad claims. These broad claims can be used to extort royalties from companies using patented technology that is not novel or non-obvious.
According to a report, China overtook the United States in the number of international patents in 2019, filing nearly 59,000 applications. China may have overtaken the United States in the total number of international patents filed in 2019, but legal experts warn that much of the growth is being driven by government-backed subsidies and incentives that could flood the system with cheap and low-quality patents which are of no use to an assignee and add almost negligible value to his patent portfolio.
This is one of the many reasons why the number of low-quality patents is increasing in the overall Patent Industry.
Before we dive into the reasons for low-quality patent filings let’s discuss why it is even important to analyze the quality of a patent.
Why Should We Care About Patent Quality?
- The most obvious consequence of poor-quality patents is an increase in litigation (backlog of filings and “litigation intensity” – in terms of litigation filed per valid patent).
A low-quality patent system means there are more patents with greater uncertainty, leading to increasing disputes over patents, and increasing reliance on the courts as final decision-makers. Patent uncertainty also means that litigation is more complex and costly, increasing both the private and social costs of the system.
- A liability for the assignee!
Suppose Company A has applied for a wearable device patent that covers all the main features of a wearable device. Meanwhile, another company, B, integrates all these features into its wearable product and launches it.
Now, since the first organization has paid a hefty amount on R&D as well as the patent filing process, so to leverage the “compensatory royalties” of its patent for infringing it, company A can file a civil lawsuit for patent infringement in a district court against company B.
In its response, Company B (defendant) may also initiate parallel proceedings with the USPTO challenging the validity of Company A’s asserted patent. This is referred to as the “post-grant” process. The most common post-grant procedure is the “inter-parties review” (IPR), in which the validity of a patent is challenged based on prior art. Company B could easily use the poorly devised claims of Company A in the court and can prove how its wearable device hasn’t infringed upon company A’s claims, but it did so literally.
And there stands Company A’s patent which could be invalidated too.
So, a low-quality patent digs into the pocket as well as is at the risk of being invalidated along with no monetary/royalty benefits in case someone infringes it.
Who is responsible for a low-Quality Patent?
- Competitive Environment And Pressure
In this cut-throat competitive world, every other company is in the race to get maximum benefits out of their innovations and research. Companies want to take a patent on almost every technology, they want to make space for every new-coming technology for which companies even conduct whitespace analysis.
Organizations put pressure on the in-house IP experts and patent attorneys to file many patents on very low budgets. Achieving the goal of ‘n’ patents instead of a small number of high-quality patents and trying to compete with peers often leads to low-quality patents.
It is the management who is responsible for such low-quality patents because at the end of the day IP experts have to adhere to the instructions of their management team. The value of many large patent portfolios lies not in the specific rights or the quality of the inventions they cover, but in their size and shadow.
Due to tight budgets, organizations also refrain from patentability searches by in-house IP experts and other consulting firms. This paves the way for low-quality patents to end up in the patent office, and with a little luck, even patents that are neither financially nor technically relevant are granted.
- Drafting Team
Due to reckless, inexperienced members of a Patent drafting team, many a time even a million-worth patent is drafted in such a way that it loses its potential as well as its essence to even make money out of a patent.
A claim is the soul of a patent.
People say, “First impression is the last impression” and the claim is the first thing that any IP Professional would check to get the crux of the patent.
How can even a valuable patent justify its technical invention and R&D team efforts if the claims are poorly or generally ill-formulated?
- Leniency By Patent Granting Offices
For a patent to be granted in the US, the conditions are:
(1) Patentable Subject Matter,
(4) Non-obviousness, And
Many patents are granted with only a small inventive step. The patent office follows certain standards that new patent applications to be granted as patents must follow, but many a time the standards are too lenient and that is how even a low-quality patent Is granted by the Patent offices.
Also, the granting of patents that do not even meet the patent office’s standards is the reason for such low-quality patents.
Patents are obtained for different reasons than conventional theory often assumes. Thus, the conventional understanding is that assignees use patent rights to protect their investments in innovation and development by excluding others from the scope of goods or services based on their patented ideas.
But now the case is completely different. An assignee wants to get a monopoly in every technology domain to debar competitors from obtaining relevant patents. In that case, the patentee will care less about patent quality; what matters in that case is not the ability to withstand a validity challenge in litigation, but simply the fact of the presence of patent.
How Could Low-quality Patent Be Avoided?
- Quality>>>Quantity: Companies should focus on quality rather than the quantity of patents filed. It ultimately pays off financially and paves the way for innovation.
- Patentability search: Prior to filing a patent application directly with the Patent Office, the assignee should have an overview of the prior art and thoroughly research the patentability of the patent so that it can save costs for drafting/filing/maintaining the patent.
- Expert examiners: Employing a good number of qualified and experienced examiners in the patent office will ensure that standards are properly followed, ultimately resulting in high-quality patents being granted.
- Prioritizing Patent Quality: Having an institution check the quality of a patent would make sure that poorly formatted claims are evaluated and restated effectively.
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