New Ways to Determine Patent Novelty

Jonathan Ashtor (now at Paul, Weiss) has completed a few quality empirical studies in the past. His new foray is a new and creative way to determine novelty. It's on SSRN, and the abstract is here:

I construct a measure of patent novelty based on linguistic analysis of claim text. Specifically, I employ advanced computational linguistic techniques to analyze the claims of all U.S. patents issued from 1976-2014, nearly 5 million patents in total. I use the resulting model to measure the similarity of each patented invention to all others in its technology-temporal cohort. Then, I validate the resulting measure using multiple established proxies for novelty, as well as actual USPTO Office Action rejections on grounds of lack of novelty or obviousness. I also analyze a set of pioneering patents and find that they have substantially and significantly higher novelty measures than other patents.

Using this measure, I study the relationship of novelty to patent value and cumulative innovation. I find significant correlations between novelty and patent value, as measured by returns to firm innovation and stock market responses to patent issuance. I also find strong correlations between novelty and cumulative innovation, as measured by forward citations. Furthermore, I find that patents of greater novelty give rise to more important citations, as they are more frequently cited in Office Action rejections of future patents for lack of novelty or obviousness. I also investigate how novelty relates to the USPTO examination process. In particular, I find that novelty is an inherent feature of a patented invention, which can be measured based on the claim text of either an issued patent or an early-stage patent application.

Next, I use this measure to analyze the characteristics of novel patents. I find that novelty is an effective dimension along which to stratify patents, as key patent characteristics vary significantly across the distribution of novelty measures. Moreover, novel patents are closely linked to basic scientific research, as measured by public grant funding and citations to non-patent scientific literature.

Finally, I use this measure to observe trends in novelty over a forty-year timespan of American innovation. This reveals a noticeable, albeit slight, trend in novelty in certain technology fields in recent years, which corresponds to technological maturation in those sectors.

 I'm skeptical of measures of patent quality by claim language only, but I like how he has used office actions to validate the measure. I think people will have to study this to see how it holds up, but I think it's an interesting and creative first step toward objectively judging quality.

Brian Soucek on Aesthetic Judgment in Law

As noted in my last post, one of the most quoted lines in copyright law is from Justice Holmes's 1903 opinion in Bleistein: "It would be a dangerous undertaking for persons trained only to the law to constitute themselves final judges of the worth of pictorial illustrations." This aesthetic neutrality principle has found purchase far beyond copyright law. But in a compelling new article, Aesthetic Judgment in Law, Professor Brian Soucek challenges this dogma: "Almost no one thinks the government should decide what counts as art or what has aesthetic value. But the government often does so, and often, it should." Soucek's article may have flown under the radar for most IP scholars because he does not typically focus on copyright law, but it is well worth a look.

Examining the Role of Patents in Firm Financing

Just this morning, an interesting new literature review came to my mailbox via SSRN. In Is There a Role for Patents in the Financing of New Innovative Firms?, Bronwyn Hall (Berkeley economics) provides an extremely thorough, extremely helpful literature review on the subject. It's on SSRN, and the abstract is here:

It is argued by many that one of the benefits of the patent system is that it creates a property right to invention that enables firms to obtain financing for the development of that invention. In this paper, I review the reasons why ownership of knowledge assets might be useful in attracting finance and then survey the empirical evidence on patent ownership and its impact on the ability of firms to obtain further financing at different stages of their development, both starting up and after becoming established. Studies that attempt to separately identify the role of patent rights and the underlying quality of the associated innovation(s) will be emphasized, although these are rather rare.

This paper caught my eye for a few reasons.

Barton Beebe on Bleistein

Barton Beebe’s recent article, Bleistein, the Problem of Aesthetic Progress, and the Making of American Copyright Law, was already highlighted on this blog by Shyamkrishna Balganesh, but I wanted to add a few thoughts of my own because I really enjoyed reading it—it is a richly layered dive into the intellectual history of U.S. copyright law, and a wonderful piece to savor on a weekend.

In one sense, this is an article about one case’s role in U.S. copyright law, but it uses that case to tackle a fundamental question of copyright theory: what does it mean “to promote the Progress”? Beebe’s goal is not just to correct longstanding misunderstandings of Bleistein; as I understand it, his real point is that we can and should “assess[] aesthetic progress according to the simple propositions that aesthetic labor in itself is its own reward and that the facilitation of more such labor represents progress.” He thinks Justice Holmes’s invocation of “personality” in Bleistein represents a normatively attractive “third way” between judges assessing aesthetic merit and simply leaving this judgment to the market—that aesthetic progress is shown “by the mere fact that someone was willing to make the work, either for sale or otherwise, and that in making it, someone had invested one’s personality in the work.”

This personality-centered view of copyright seems similar to the Hegelian personality theory that was drawn into IP by Peggy Radin and elaborated by Justin Hughes, though at times it seems more like Lockean theories based on the author’s labor. I think he could have done more to explain how his theory relates to this prior literature, and also how it’s different from a utilitarian theory that recognizes the value creators get from creating (à la Jeanne Fromer’s Expressive Incentives). In any case, I think Beebe’s take is interesting, particularly with the connection he draws to John Dewey’s American pragmatist vision of aesthetic progress.

Mark McKenna: Trademark Counterfeiting And The Problem Of Inevitable Creep

One of my favorite events at Akron Law this past school year was hearing Professor Mark McKenna deliver the Oldham Lecture on his fascinating paper, Criminal Trademark Enforcement And The Problem Of Inevitable Creep.  The completed article, forthcoming in the Akron Law Review, is now available on SSRN.

The story, in Mckenna's telling, is simple. There is a criminal remedy for trademark "counterfeiting" because, most people would agree, using an identical trademark for goods or services that are identical to the trademark owner's is an economically and morally worse act than ordinary trademark infringement. A modern-day example of this atrocious crime is the company that has been hawking dysfunctional "Philips Sonicare" toothbrush replacement heads on Amazon.com. Consumers buy them thinking they are the real thing, and are sorely disappointed when the brush heads do not work. But to deserve the classification as criminal, as a legal matter, the act of counterfeiting must be proven "beyond a reasonable doubt" to fit within the exact text of the relevant statute, the Trademark Counterfeiting Act. According to McKenna, courts have veered from the statutory text, and are instead expanding criminal counterfeiting beyond Congressional authorization. Thus, the article's reference in its title to "inevitable creep."

There are parts of this well-done article with which people are likely to agree, and other parts with which people are likely to strongly disagree.

A Focus on Innovators Instead of Innovations

I noticed this week that my sometimes co-author Colleen Chien (Santa Clara) has posted the abstract for a new paper called Innovators on SSRN:

This Article argues for a shift in how we view and use the patent system, to a way of understanding and cultivating innovators that patent, not just patented innovation, for three reasons. First, who is innovating and where has relevance to a myriad of current social and policy debates, including the participation of women and minorities in innovation, high-skilled immigration, and national competitiveness. Second, though largely overlooked by academics, America’s patent system has long been innovator-, not only innovation-driven, and scholarly engagement can improve the quality of relevant policymaking. Third, the application of new computational tools to open patent datasets makes it possible to more easily approximate and track salient details about innovators that patent - including the geography and settings in which they innovate and the personal demographic traits of innovators - enabling the tailoring and tracking of impacts of interventions on disparate groups of innovators. This Article details why and how to do so by applying novel empirical methods to profiling patentees, revealing broad shifts over the past four decades, and demonstrating—through three mini-case studies pertaining to diversity in the technology sector, the promotion of small and individual inventors, and innovation in medical diagnostic technologies—how improving our understanding of innovators can improve our promotion of innovation.

A draft isn't available yet, but hopefully one will be soon. My thoughts on this abstract, though, are "hear, hear!" I think that too little attention has been paid to the people who innovate. There is, to be sure, a rich history of historians and economic historians who have focused on these points. Zorina Khan, Naomi Lamoreaux, and Ken Sokoloff (z''l) come to mind. In law, Adam Mossoff has provided several case studies and Chris Beauchamp has done outstanding historical work highlighting innovators in their time. Mark Lemley leveraged some historical work in an article about simultaneous inventing, and others have looked at those same innovators to tell competing stories.

But much of this work is historical. Of late, as the abstract notes, it's all about the what: What inventions? What classes? What litigation? How many claims? I think people clamor for stories about innovators; I believe my most downloaded (by far) SSRN paper, Patent Troll Myths, resonated because it looked hard at the innovators - individuals to small entities to large companies. Dan Burk looks at innovators (but without data) in Do Patents Have Gender? 

I'm sure there are examples I'm not thinking of, but more data and analysis in this area would be welcome. Patents exist in service to their inventors, and so it makes sense to understand who those are to better understand whether patents are achieving their goals...or even what the goals are.

When Should Actors Get Copyrights in their Performances?

In Garcia v. Google, the en banc Ninth Circuit ruled that actors can basically never obtain a copyright in their performances. I was one of, say, ten people troubled by this decision. My IP academic colleagues will surely recall (too) long debates on the listserv on this issue. It turns out that another of the ten is Justin Hughes (Loyola LA), who has now written an article exploring when and why actors might reasonably claim copyright in a performance. The article, called Actors as Authors in American Copyright Law, is on SSRN and is forthcoming in the Connecticut Law Review. The abstract is here:

Among the different kinds of works eligible for copyright, audiovisual works are arguably the most complex, often involving scores of contributors – screenwriters, directors, actors, cinematographers, producers, set designers, costume designers, lighting technicians, etc. Some countries expressly recognize which categories of these contributors are entitled to legal protection, whether copyright, ‘neighboring rights,’ or statutory remuneration. But American copyright law does not. Given that the complex relationship among these creative contributors is usually governed by contract, there is – for such a large economic sector – relatively little case law on issues of authorship in audiovisual works. This is especially true on the question of dramatic performers as authors of audiovisual works.

This Article provides the first in-depth exploration of whether, when, and how actors are authors under American copyright law. After describing how case law, government views, and scholarly commentary support the conclusion that actors are authors, the Article turns to the strange saga of the Ninth Circuit’s 2015 en banc Garcia v. Google decision – a decision more about fraud and fatwas than clear conclusions on how copyright law applies to acting. The Article then uses some simple thought experiments to establish how dramatic performers generally meet both the Constitutional and statutory standard for “authorship.” Finally, the Article reviews the various filters that prevent actors-as-authors legal struggles and how, when all else fails, we can consider actors as joint authors of the audiovisual works embodying their dramatic performances.

The article presents a detailed and nuanced view of what it means to be an author, as well as a good discussion of the development of the law in this area. As the abstract alludes to, it turns out that much of our view of actor protections is based on how things have been done and expediency (e.g. work made for hire) rather than a detailed examination of authorship in film.

For example, it has always been unclear to me why we protect a musician's performance of pre-scripted music in a sound recording, but not an actor's performance of a pre-scripted movie in an audiovisual work. The statute allows for both protections, and the primary reason seems to be that we don't think it's right.

Similarly, joint authorship is very strange. In Aalmuhammed v. Lee, the Ninth Circuit ruled that, despite the contribution of several elements and several scenes, one must be either a full joint author or nothing. There is no in-between. Like Garcia v. Google, this appears to be for expedience (and Hughes examines several other reasons), as well as a view that the only "work" can be the final work, and not each scene before it is pieced together, a legal fiction in the modern era of copyrightability in unpublished works.

This article explores much of the thinking I had at the time of Garcia v. Google, so those who favored that ruling will likely think it is as crazy as they thought I was. However, I think the article is still worth a read, if only to pinpoint where you think it goes astray, if it does.

Academic IP Conferences

Three years ago, I posted some general advice about academic IP conferences, including links to sites that compile IP conference information. Most of that advice still stands, but the definitive IP conference compilation site has moved to https://emptydoors.com/conferences, where it is maintained by Professor Saurabh Vishnubhakat—who was a wonderful member of a conference panel I moderated last week.

The most recent entry on Saurabh's site is interesting: the AALS Remedies Section has a call for papers for a program on IP remedies at the Jan. 2019 AALS Annual Meeting in New Orleans. Abstracts are due June 1.

Jake Sherkow Guest Post: What the CRISPR Patent Appeal Teaches Us About Legal Scholarship

Guest post by Professor Jake Sherkow of New York Law School, who is currently a Visiting Scholar at Stanford Law School.

Yesterday, the Federal Circuit heard oral argument in the dispute between the University of California and the Broad Institute over a set of fundamental patents covering CRISPR-Cas9, the revolutionary gene-editing technology. Lisa has been kind enough to invite me to write a few words here about the dispute, and I thought I’d take that generous opportunity to discuss two aspects of yesterday’s argument: the basics of the appeal and, given that this blog is devoted to legal scholarship about patent law, what the argument can teach us, if anything, about IP scholarship in general. I think the short answer to the second question is, Quite a lot, although perhaps not for obvious reasons.

Measuring the Value of Patent Disclosure

How valuable is patent disclosure? It's a perennially asked question. There are studies, like Lisa's, that attack the problem using surveys, and the conventional wisdom seems to be that there are niche areas that read patents, but for the most part patent disclosure holds little value because nobody reads them.

Deepak Hegde (NYU Stern), Kyle Herkenhoff (Minn. Econ), and Chenqi Zhu (NYU Stern PhD candidate) have decided to attack the problem from a different angle: using the AIPA (which required patent disclosure at 18 months) as a natural experiment. The paper is on SSRN, and the abstract is here:

How does the disclosure of technical knowledge through patents affect knowledge diffusion, follow-on invention, and patenting? We study this by analyzing the American Inventor's Protection Act (AIPA), which required U.S. patent applications filed after November 28, 2000 to be published 18 months after filing, rather than at grant, and advanced the disclosure of most U.S. patents by about two years. We estimate AIPA’s causal effect by using a counterfactual sample of identical European “twins” (of U.S.patents) which were not affected by the U.S. policy change and find that AIPA (i) increased the rate and magnitude of knowledge diffusion associated with U.S. patents (ii) increased overlap between technologically distant patents and decreased overlap between similar patents. Patent abandonments and scope decreased, while patent clarity improved, after AIPA. The findings are consistent with the predictions of our theoretical framework which models AIPA as provisioning current information about related technologies to inventors. The information, in turn, reduces follow-on inventors’ R&D and patenting costs. Patent disclosure promotes knowledge diffusion and clearer property rights while reducing R&D duplication.

This was a clever project. There have been AIPA studies before, but none that try to measure the value of the diffusion, so far as I know. What makes it go is the matching with European patents (which had always been published), which allows for their measurements to be independent of quality of invention.