Innovation and Its Discontents: How Our Broken Patent System is Endangering Innovation and Progress, and What to Do about It (review)

This is a timely and concise book that presents a comprehensive and convincing argument about the not-so-explicit changes in U.S. patent law beginning in 1982, changes that the authors argue have broken a patent system that worked previously. Primarily this book could be slated as a discussion between economists and lawyers, and yet it is very effective for a lay reader; the economists, i.e. the authors, lay the blame squarely on patent lawyers. Nevertheless, the authors' analysis offers useful insight for anyone with research interests in this area as to how to make strategic interventions in the takeover of the patent process by special interests and their lawyers.

Adam Jaffe of Brandeis University and Josh Lerner of Harvard Business School argue a strong case as to how the current (read: since 1982) patent regime has failed to deliver the promise of America's innovation engine. It further prescribes certain strategies to make the necessary corrections to the problems at the U.S. Patent and Trademark Office.

One line of the book's argument is the clogging up of the patent system by pesky patent lawsuits and the associated economic fallout that discourages the innovation process. One of the pressures identified by the authors is the diversification of patent revenue to other governmental expenses.

One of the key chapters in the book is Chapter Four, in which the authors focus on the Court of Appeals for the Federal Circuit (CAFC), the appellate patent specialty court with the most influence on the patent system. The authors discuss the CAFC's role in increasing patent strength by broadening the list of topics that can be patented and putting restrictions on challenges to patent validity, and offer more effective solutions.

The authors tend to be more communal when offering solutions. They propose peer scrutiny as a better mechanism than individual expertise in the evaluation of patents. Further, they want the other stakeholders in this community of innovators, such as scientists and businessmen, to weigh in about any issue around the novelty of a new invention. There is an interesting suggestion made regarding the role of challenges to patents. The authors think such challenges should take place primarily in a patent office and not necessarily be discussed in front of a jury perhaps not equipped with the nuanced understanding imperative for such evaluations. They make another point about how to prevent useless and pesky tactics by making the challenger pay for the costs if she or he loses the patent challenge. This is all summed up in Chapters Six and Seven, in which the authors examine previous failures and strategize for future reform. In addition to the above, the authors suggest recouping more resources for patent examination, the establishment of a pre-grant opposition, giving judges more powers, and better deployment of knowledgeable professionals to advise judges on complex topics.

In regard to suggestions as to how the system could be improved, one will have to give the authors the benefit of the doubt, given the scope of the topic and the limitations offered by a 200-odd-page book. One notices that they are steadfast in articulating their faith in the traditional patent system rather than talking about the undoing of the changes in appeals court jurisdiction, which according to the authors is one of the key factors in the downward trend in innovation. Not everyone is going to take their diagnosis and prescription on face value. That is the paradox!

In any case, one can fairly say that the authors largely succeed in putting across their main argument. They employ interesting strategies and tools to keep the tone of the book light despite dealing with such a dry and tedious subject. Anecdotal tone...