Reviving the Gatekeeping Function: Optimizing the Exclusion Potential of Subject Matter Eligibility
72 Pages Posted: 30 Apr 2012 Last revised: 25 May 2014
Date Written: April 30, 2012
Today, patents that fail the constitutional mandate “[t]o promote the Progress of Science and useful Arts” are frequently issued. Patents are granted irrespective of whether they are actually needed to incentivize innovation. Consequently, many patents fail to reflect an appropriate balance between the ex post costs of short-term monopoly and the benefits of higher ex ante incentives to innovate. Other patents are issued albeit having no prospected commercial use. Meaning, no one actually makes an economically beneficial use of them. The worst of these are those that are sought solely for the purpose of initiating infringement lawsuits and extorting licensing fees from competitors. To prevent the issuance of such bad patents and maximize section 101’s exclusion potential, this article suggests a new gatekeeping approach to subject matter eligibility. Rather than proposing a strict gatekeeping approach of categorical exclusion, it advocates a lenient approach of flexible, policy-based exclusions. In particular, it identifies two unique characteristics of bad patents: the first refers to patents that cover inventions whose development is not depended on the incentives provided by the Patent Act, and the second refers to patents that lack any prospected commercial use. Such patents are economically valuable, and therefore, are particularly vulnerable to abuse by patent trolls. Observing that neither the current doctrine of subject matter eligibility articulated by the three common law exceptions, nor the other statutory requirements for patentability, indulge these unique characteristics, this article proposes to supplement the current doctrine of subject matter eligibility with two additional policy-based requirements. The first requirement is a showing sufficient to convince a person having ordinary skill in the art, that the invention would not have been developed “but for” the incentives afforded by the Patent Act. The second is a showing sufficient to convince a person having ordinary skill in the art that, a) there is a market for the invention, and that b) the invention can be manufactured at a cost sufficient to fulfill market demand. These requirements, this article suggests, should effectively exclude bad patents for violating the policies underlining our patent system without falling into the trap of over-exclusiveness or under-exclusiveness associated with per se rules of categorical exclusions.
Keywords: patent, subject matter, section 101, bad patent, patentability, patent troll, monetary incentives, gatekeeping, categorical exclusion
Suggested Citation: Suggested Citation