Moreover, a firm that can get along without patent protection may have compelling reasons to oppose such protection because of fear of how its rivals may use it against the firm. A patent blocks competition within the patent's scope and so if a firm has enough patents it may be able to monopolize its market. This prospect gives rise to two wasteful phenomena: defensive patenting and patent trolls. Defensive patenting means getting a patent not because you need it to prevent copycats from making inroads into your market, but because you want to make sure that you're not accused of infringing when you bring your own product to market. The cost of patenting and the cost of resolving disputes that may arise when competitors have patents are a social waste.
Patent trolls are companies that acquire patents not to protect their market for a product they want to produce -- patent trolls are not producers -- but to lay traps for producers, for a patentee can sue for infringement even if it doesn't make the product that it holds a patent on.
These problems are aggravated by several additional factors. One is that the Seventh Amendment to the U.S. Constitution confers a right to a jury trial in cases in federal court if the plaintiff is asking for an award of money damages, as plaintiffs in patent infringement suits normally do. Judges have difficulty understanding modern technology and jurors have even greater difficulty, yet patent plaintiffs tend to request trial by jury because they believe that jurors tend to favor patentees, believing that they must be worthy inventors defending the fruits of their invention against copycats -- even though, unlike the rule in copyright law, a patentee need not, in order to prevail in an infringement suit, show that the defendant knew he was infringing. This problem is exacerbated by the fact that in some industries it is very difficult to do a thorough search of patent records to discover whether you may be infringing someone's patent; and even if doable, the search may be very expensive. Notice too--an independent problem with current patent law -- that difficulties of search, and the prospect of incurring litigation costs to defend an infringement suit, may actually discourage innovation.
Another troublesome factor is that the Patent and Trademark Office is seriously understaffed. As a result, many patent examinations are perfunctory, and there is a general concern that too many patents are being issued, greatly complicating the problems I've been discussing. There is now a three-year backlog in the office--a three-year delay on average between the filing of a patent application and the decision by a patent examiner on whether to grant the application.
There are a variety of measures that could be taken to alleviate the problems I've described. They include: reducing the patent term for inventors in industries that do not have the peculiar characteristics of pharmaceuticals that I described; instituting a system of compulsory licensing of patented inventions; eliminating court trials including jury trials in patent cases by expanding the authority and procedures of the Patent and Trademark Office to make it the trier of patent cases, subject to limited appellate review in the courts; forbidding patent trolling by requiring the patentee to produce the patented invention within a specified period, or lose the patent; and (what is beginning) provide special training for federal judges who volunteer to preside over patent litigation.