By: Stuart P. Meyer
A recent episode of NPR’s “Planet Money” was entitled “The Case Against Patents.” Several notable commentators in that episode questioned whether patents help or hinder innovation, whether history supports the benefits of a patent system, and whether patent terms should be tinkered with to determine the amount of protection that is optimal from various socio-economic perspectives. I am delighted every time this issue is brought up, since the appropriate balance of rights between innovators and society is anything but static. As reasonable royalty rates fluctuate under case law, as infringement and validity standards shift, and as patents become commodities traded outside of traditional M&A situations, the fulcrum is certain to shift in one direction or the other.
The Supreme Court gave more than a little consideration to such issues in Alice v. CLS Bank. In fact, the very focus of this unanimous opinion was on this balance:
We have described the concern that drives [the judicially-created exclusion for laws of nature, natural phenomena and abstract ideas] as one of pre-emption. … Laws of nature, natural phenomena, and abstract ideas are “‘”the basic tools of scientific and technological work.”’” (slip op. at 5-6)