Patent Reform–The Legitimacy of the USPTO in a Loser-Pays System

How would a loser-pay system affect public trust and confidence in the United States Patent and Trademark Office (USPTO)?

Let’s say you file a patent application and the USPTO issues you a patent.  You believe someone is infringing and you file a lawsuit.  Unfortunately for you, the patent is ruled invalid–you lose, you pay.

As you reach in your pocketbook to pay the defendant’s legal fees for defending the case, you think to yourself: if the USPTO didn’t issue me the patent in the first place, I never would have filed on it.  But because I relied on the USPTO’s issuance as a presumption of validity, I’m the loser.

How would I adjust my behavior?  I will simply stop relying on the USPTO’s issuance of a patent as a presumption of validity.

A loser-pays system will undermine public trust and confidence in the legitimacy of the USPTO.

The results?

We’ll see a significant drop in (1) patent filings, which signals to the world that America’s innovation is trending downwards, and (2) investment capital into start-up ventures, particularly those that moderately-to-significantly rely on their patented ideas as the backbone of their business model.

Before we pass rushed bills through Legislature, let’s consider the impact of our decisions, particularly those that would undermine America’s foothold in the free world and cripple its economy.


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