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Obama’s Anti-Patent Bias

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Obama’s Anti-Patent Bias Led to the Destruction of His Legacy

By Neal Solomon
December 14, 2016

Barack Obama came to office with the suspicion that patents caused higher prices and created market inefficiencies. He set a mission to disassemble the patent system, which culminated in the America Invents Act, a one-way legislation that deprived inventors of patent rights and naively transferred power to market incumbents. In its implementation in the U.S. Patent and Trademark Office (PTO), patents were attacked by market incumbents in a second-window patent examination with the effect of destroying a substantial number of patents.
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The Obama contradictions on patent policy include: (a) a desire to assist start-ups, but penalizing start-ups by attacking the only tool, viz., patents, available to compete against larger corporations; (b) helping China, which has a massive manufacturing sector, attack U.S. innovators; (c) starving U.S. start-ups and ventures of capital by weakening patent rights that investors require and by harming start-ups that create two-thirds of jobs, thereby constraining job creation; (d) demanding substantially increased litigation barriers to enforce patents, which hurt the weakest companies that need patent rights the most; (e) aligning with the far right to protect the monopoly power and profits of large corporations (in effect promoting trusts rather than enforcing antitrust laws that attack trusts); (f) claiming a need for innovation to spur growth while attacking the patent system’s essential tools for competition; (g) not realizing that litigation and access to the judicial system is the only way to even the playing field between market entrants and larger companies; (h) aligning with the open source movement, which attacks property rights, and advocates openness in government at the risk of harming legitimate government secrecy and security; (i) appointing patent critics to policy positions to delegitimize patent rights; (j) not realizing that weakening patents promotes inequality, which they attack; (k) encouraging large corporations to hold out from negotiating licenses for patented inventions and then complaining about the high costs of litigation; (l) claiming that patent holders hold up manufacturers even when the patent holders are not eligible for injunctions (and thus cannot hold out to enforce an exclusive right) and rewarding the infringer rather than the innovator; (m) drastically increasing costs in the Patent Office in the name of increasing efficiency but with the effect of providing a high regressive tax to inventors and then complaining that we don’t have enough innovation; (n) advocating an unrealistic emphasis on manufacturing but advocating a utopian vision that ignores the U.S.’s only competitive advantage of innovation; (o) crushing American small entities in the Patent and Trademark Office in order to favor East Asian institutions, suggesting that they don’t know who their friends are; and (p) advocating for an aristocratic patent system that requires vast capitalization for innovators when their rhetoric suggests the ideals of a democratization of patents. It would appear, then, that the Obama patent policy is hypocritical and self-contradictory, with more in common with the previous administration that it critiques. These convoluted political positions are largely responsible for the weak economic development and jobless recovery of the recession years.
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The terrible consequences of these contradictory policies that attacked patent rights and helped market incumbents are just now evident. Because he attacked the patent system, market entrants and small entities suffered their worst declines ever recorded. The disintegration of patent rights robbed incentives to innovate. Investment in innovation declined dramatically, not only for market entrants because of the uncertainty that accompanies weak patent rights but also for incumbents; since incumbents could free ride on market entrants, they lacked incentives to invest in innovation. With declining investment in innovation, productivity growth recorded its worst showing in generations, even as tech incumbents realized the greatest profits in history. As a consequence of weak productivity growth, the economy stagnated.
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https://www.ipwatchdog.com/2016/12/14/obama-anti-patent-bias-destruction-legacy/id=75618/