Inventors: Reforming U.S. patent bill will have a chilling effect on innovation

Published 16 March 2009

There are those who argue that the current U.S. patent and copyright laws have a chilling effect on innovation and creativity; then there are those who argue that effort to reform these laws and limit damages U.S. inventors can claim from infringing companies will stifle innovation and creativity; the debate continues

We wrote several stories about the view of many economists that the current U.S. patent law is not conducive to innovation and creativity (see “Copyright and Patent Laws Killing Innovation, Hurting Economy” and “Markets Outperform Patents in Promoting Intellectual Discovery”).

There are those who make the counterargument. Legislation to reduce the damages U.S. inventors can claim from companies who infringe their patents was slammed as a “chill on innovation” by an inventors’ group last week. The Democrats have reintroduced the Bush administration’s Patent Reform Bill, which ran out of congressional time in April 2008. This would set damages in proportion to the contribution any invention makes to a product, rather than the product’s value.

One aim is to slash incentives for “trolls” who patent ideas with the intention of suing companies with a similar technology. Such a case cost the BlackBerry maker Research In Motion $612 million in 2006. The inventors’ group Innovation Alliance says that all inventors will suffer from reduced damages as a result.