Inclusive Patents for Open Innovation
47 Pages Posted: 19 May 2020 Last revised: 29 Jul 2021
Date Written: February 21, 2020
The post-internet era has greatly affected commercial firms’ innovation processes. The complexity and cumulative nature of emerging technologies under the post-internet era has made commercial firms reevaluate their innovation processes and has increased the role of individual innovators. Firms dealing with emerging technologies cannot make products without infringing on patents held by others, as their products are covered by numerous overlapping patents. Many of these firms work with individual innovators and embrace the open-source philosophy that ensures open access to technologies. These firms can no longer use patents for excluding others without risking infringement counterclaims, leading to the development of new uses of patents: defensive use to avoid litigation and proactive use to promote open innovation. The current U.S. patent has become increasingly outdated for failing to take into account these new uses of patents. Although firms have implemented self-help arrangements by retooling patents with licenses and private-ordering mechanisms, the arrangements still fall short as they result in: (1) no defensive function against patent assertion entities (PAEs) and (2) insufficient proactive use if innovators fail to disclose their invention through USPTO, due to expensive patent costs. Patent reform is necessary to overcome such shortcomings. In light of recent changes, this article proposes issuing inclusive patents as an alternative option to current exclusive patents. The proposed inclusive patents allow anyone who licenses their patented inventions to practice the protected invention, and are only enforced defensively when the owners are charged with infringement. The inclusive patents enable owners to request a preliminary procedure to grant a compulsory license in light of the eBay factors when they are charged with infringement of blocking patents. The compulsory license enhances the defensive use of inclusive patents to avoid litigation with PAEs, and guarantees owners the freedom to operate and innovate on their inventions. Because of the limited exclusivity, the USPTO should allow simplified patent applications and issue inclusive patents without examination. With low patent costs, all types of innovators can take advantage of the proactive use of inclusive patents through USPTO disclosures.
Keywords: Patents, Open Source, Innovation, Licenses, Licensing, Incentive to Share, Incentive to Invent, Disclosure, Patent Pledge, Compulsory Licenses, Injunction, Royalty, Open Innovation, Close Innovation, Information Technology, IT
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