Chapter 36
Throwing in the Patented Sponge
2As SOON as one considers the economics of highly scientific and abstract instruments, such as radio sending and receiving apparatus, another extraordinary monopoly, sustainable by legal fabrication, becomes apparent. This monopoly, most popularly and unwittingly supported, confers a control-and-retardment-of-progress ability and is inherent in our ‘‘constitutionally’’ supported PATENT law.
3 Patents originally represented gestures of ‘‘largesse’’ on the part of sovereigns, monarchs, dukes, or lesser feudal masters, to members of their court or tenantry. They were designed to encourage thoughtful pioneering, the results of which might obviously be productive of greater wealth both to the feudal leaders and indirectly to their hosts of followers and subjects.
4 The title ‘‘Court architect,’’ ‘‘Court painter,’’ ‘‘dancer’’ or ‘‘astrologer,’’ carried with it certain patronage privileges and funds. Although utterly arbitrary in amount, as pleased the monarch’s mood, such grants supposedly enabled the ‘‘loyal’’ FOLLOWER profitably to exercise his specific ability.
5 When emissaries of a monarch had cause to go far afield, as in exploration for the capture of foreign lands to enrich the empire, they were given, also, ‘‘letters patent’’ citing them as temporary emissaries of the sovereign in their particular field of activity.
6 When the democratic idea broke loose in Europe, as a result of the partial emancipation of man by his artist-and-scientist devised mechanisms, the popular representatives of that time, thinking by habit in terms of feudal structure and laboring under the problem of transferring privilege of sovereignty to the populace, deemed it a wise and just act to embody the ‘‘letters patent’’ idea in their democratic constitutions.
7 The intent behind the democratic governments’ granting of patents to individuals was that such licensed persons might, through a temporary monopoly of profit, be compensated for their initiative and extra-time occupation in the invention and devisement of socially useful mechanisms and processes, inasmuch as abstract entities did not come under the traditional ‘‘real’’ property protection. It was also considered that the giving of time to an inventor to earn an encouraging excess of profit would encourage others to similar pro-social activities, thus enriching the national capital for favorable international trade balance.
8 The patent monopolies were of variable duration, let us say, 1 to 30 years, but all were SPECIFICALLY limited-by-time monopolies, whereas the royal patents were often given for ‘‘life.’’
9 The necessity of invention growth was highly apparent to the budding democracies, for had not invention itself forwarded man to the possibility of emergent DEMOCRACY? (It is not inappropriate to note that Bernard Shaw was able to remark centuries after the first illusory notion by man that he had established a democracy, ‘‘There is nothing the matter with democracy except that it has never really been tried.’’
10 Paradoxically to the original democratic patent concept, today the licensed invention monopoly is no longer useful to the individual citizen in terms of its design and incorporation in democracy. It is in fact not only non-operative as designed, but is definitely a boomerang to democracy. The explanation is simple.
11 Few and far between were the inventions on which patents were granted in the early days of any of the, as Shavian appraised, quasidemocracies. When the U. S. devised her democratic principles in the writing of the Constitution, she incorporated also the patentto-the-individual features. At first the patents granted throughout many years could be counted on the fingers of two hands. Then, as industrial growth developed into a highly mechanical state, patents became more numerously applied for until, suddenly, the applications attained immense proportions. (See patent curve on Charts.) More than two million have been granted in the United States alone to date, a figure bemusingly to be compared with the relatively meager 700 items of basic scientific achievement during the whole period of history.
12 Inasmuch as the patent idea was designed to be of use to the unfunded individual who gave his time to pro-social thought, the license fee was relatively insignificant in all countries, being solely accounted as a handling charge. In America $20 supposedly gives the inventor full and free privilege of dictation of his ‘‘royalty’’ therefrom.
13 As evolution developed the scheme, patents were applied for to cover a multitude of utterly useless devices. In fact, the vast majority granted in all countries have been unadaptable either to industrial or consumer use, or have been so untimely as to have exhausted their privilege periods prior to use.
14 The patent files are glutted with relative nonsense. There is a type of citizen, for example, who fanatically enjoys legal ‘‘privilege,’’ whether or not the enjoyment be useful to himself or others. He represents one of the many kinds of patent-file staffers. Another type is the ‘‘Rube Goldberg,’’ the with-self-chess-playing mechanical humorist, or crank.
15 At present the files are so extraordinarily complex and the items so multitudinous that a veritable army of governmental servants is required to attend them and sort them into some order of distinguishable categories to which reference may be made when corresponding with patent applicants for purposes of examiner citation of ‘‘prior art’’ disclosure. This complexity makes it inevitable that the human-equation involved in government servants relative to carelessness or mechanical limitations should occasion the granting of multitudes of ‘‘probably’’ invalid patent claims.
16 Furthermore, search within the files of all the many countries that subscribe to the international patent convention frequently reveals foreign inventions which are of current precise necessity of consideration by domestic applicants, even as these same foreign claims were formerly of inconsequential inclusion at the inception of patent granting. This change is due to the close integration of nations by accelerated modern communication and transportation. Such an international inspection usually reveals quantities of citable prior-art disclosures proving non-domestic invention.
17 Court-decisions-precedent in the matter of patent litigation inevitably developed a necessity of intricate and popularly obscure legal foresight by the applicant in the matter of the specific language of validity of his claims in anticipation of the claims of potentially contesting patentees.
18 The little inventor may prosecute his own claim upon the patent office for a cost within the minimum limit stipulated by law. However, even though he be granted a patent claim or claims (which is relatively unlikely), it will represent much time and expense for searches, et cetera, and then, although the patent may be granted relative to a basic invention its validity in litigation, due to lack of legal experience and astuteness of wording, is questionable on a probabilitybasis of 1000 to 1 ‘‘against.’’
19 This being so evident, an army of shyster patent lawyers has mushroomed up who can easily convince quasi inventors that their services are essential in the matter of application for patent. These chiseling entrepreneurs know the tricks of patent soliciting well enough to be able to assure the granting of a patent by the government of even the most questionable claims. Their ability to produce a piece of paper pleases the vanity of the applicant and provides him with a vague notion of some potential profit. There is a better chance that such inventors will discover diamond mines in their cellars.
20 To sustain a patent claim in the courts today, where an apparently obvious infringement provokes an injunction suit by the holder of the patent, necessitates, if the apparent profit involved is worth prosecution, the availability of literally millions of dollars since legal finesse and appeal-decision precedent are so illusive in this highly abstract field.
21 Patent litigation is so expensive and long drawn out that large industries, despite piratical tendencies in the directorships of many, no longer resort to patents as an OFFENSIVE means of attainment of profit, having often spent millions of dollars to prosecute a claim yielding a gross return of only a few hundred thousand, or even a $ 1 ‘‘moral victory.’’
22 Conversely, the tremendous cost of ‘‘tooling up’’ in an industrial establishment for a new and highly intricate mechanism or the production of highly intricate mechanical products represents a vulnerability to patent suit which may necessitate defensive action in litigation or costly injunction stoppage, also running into millions of dollars, together with a depletion of profit from the original operation, even though the patent title be successfully defended. To avoid possibility of deprivation of profit, most large industrial organizations whose production involves high mechanical intricacy, have developed able and large patent departments whose function it is to make world wide intensive search of patents that may in any way be uncovered by competitors to be used against them for their enweakening as a competitor, rather than for profit.
23 PATENTS, then, have become DEFENSE mechanisms ‘‘in extraordinary,’’ and practically every big industrial outfit has agglomerated a vast array of protective patent titles.
24 Incidentally Henry Ford, though holder of a few patents on his ‘‘own inventions,’’ as protagonist of the SERVICE principle and not being fear-motivated or competitive in intent, discerned that, offensively or defensively, a policy of wholesale patent activity inclusion in his operations would incur a vast credit appropriation reserve. In his judgment this could be better utilized in keeping so far ahead of competing organizations as to make it possible for him to pay off claimants daring to sue him, even under gigantic figures of judgment. He computed that this patent disregard would entail less overall expense than if he were to arm himself with a patent department and an array of trouble inviting patent titles.
25 The great patent departments of the General Electric, Bell Telephone, Radio Corporation and other companies are finding that,
26 despite their enabling efficiency through specialization and relatively unlimited funding, it costs an average of $1800 to procure a patent claim that has any possible chance of litigation sustenance.
27 The small inventor who has non-available to him the ramifications of the ‘‘company patent office,’’ finds however, that there are available to him at high fee a few truly able private solicitors who have proven their ability to obtain valid patents and to sustain them in litigation through years of familiarity with the delicately abstract nuances of the art. It is said, and probably truly, that the language of patent soliciting represents the most scientific and selectively profound employment of words. Through these few able private solicitors the small inventor, as an individual, may obtain what may be a valid and sustainable patent at an average cost of about $5000 per patent for the U. S. only. This has, it is true, a certain short-lived (approximately one year) ‘‘binder’’ advantage through the internationally accepted covenants of the Berne patent convention. Nevertheless, in view of the fact that inventions become progressively universal in application as well as in view of the close integration of industrial countries, the patentee, to make his patent of sufficient value to be saleable to one of the large industrial corporations who progressively operate internationally (without which sale there is slight hope of obtaining profitable production of the patented product or process) the patentee must, of necessity, procure patents in all pertinent foreign countries. This involves a probable additional expense averaging $5000, plus high annual foreign ‘‘maintenance’’ fees, for which latter he should have a reserve of $5000.
28 So far, the individual inventor must have available $15,000 for the procurement of potentially valid ‘‘letters patent.’’ Next comes the possibility that, after issuance to him of the paper, what is known as an ‘‘interference’’ suit may occur, arising from the fact that a relatively identical patent application was concurrently in process of review by the ‘‘examiner.’’ It takes approximately two years to process the solicitation of a patent prior to its issue, which, in the case of unwitting multiple application (a common occurrence), calls for what is known as an ‘‘interference’’ suit which is conducted by the judges of the patent office. This form of suit is not to be confused with suits instigated at the behest of a patent holder over apparent infringement subsequent to the issuance of a patent. If not successfully defended, ‘‘interference’’ cancels the issue of the patent itself.
29 It becomes apparent that although a patent applicant may have expended $15,000 in the solicitation of a probably valid patent, he may be saddled with high litigation cost mandatorially. So he must set aside a protective fund to cover this contingency. This should be another $5000. Sum totally, then, a minimum of $20,000 is required for an individual citizen as contrasted with a corporation servant to obtain what MAY be a potentially profitable patent of an originally true invention, which latter status can be determined only by subsequent litigation running into x dollars, not infrequently of seven figures.
30 The rationalization that evolves invention is primarily born of the experience of attenuated necessity. There is one chance in ten million that an inventor will have, in his own right, the financial means to procure a ‘‘true’’ patent for his invention.
31 There are, of course, freak exceptions to this as to all generalities.
32 In view of the foregoing facts it may be judiciously stated that the original intention of democracy in incorporating the patent privilege in its constitution for the abetment of prosocially thinking artist-scientists of the proletariat is no longer operative or democratically valid. It is further to be seen that Ford’s attitude toward patents is popularly just. Serving the public to the best of his ability, without subscription to the propriety of patents, he is not riding ruthlessly and piratically over the operative rights of individuals.
33 The 17 year temporary monopoly granted a patentee was of supposedly long comparative duration to the earning ability of an invention at the time of the inception of the patent law and of necessity as the industrial ‘‘lag’’ was then so long. One would certainly earn and obtain his reward within and throughout all 17 years. Today in industry—as demonstrated by the automobile section which dominates it—a patent is voluntarily held ‘‘exclusively’’ by the licensed manufacturer for two years only. After this time he passes it along to the entire industry because acceleration of technique is so great that a patent is worthless exclusively for a longer period.
34 An illuminating rationalization of the patent morass indicates that Fincap himself, its sole (and at that, ‘‘questionable’’) beneficiary, may soon sue for its nullification. The current development of multitudinous synthetic substances necessitated by sovereign ‘‘nationalism’’ is currently cited by big business men as promising the death of that portion of capitalism which is based on the old time raw material source monopolies.
35 Artificial rubber, artificial rayon, artificial cotton and wool, and artificial gasoline were characterized recently by Arthur Brash, Fincap economist, ‘‘as malinventions which will produce a destruction of capital such as has never been witnessed before. These substitutes cannot be produced as yet on an economical basis, but the dark side of the picture is that they will compete in the near future with the natural products.’’
36 The cataclysmic abrogation of international contracts now evidenced throughout the world, coupled with the increasing time space proximity of countries, also foretells a complete invalidation of local patent privilege enjoyment.
37 The vast monopolies built upon patent pool agglomerations can only serve to retard progress for man in the realization of what might often be most timely mechanical invention extensions for him, the arbitrary withholdment of which are within the power of the abstract patent monopolist. The latter may, and in fact does, continuously pigeon-hole invention in order to reap protracted profit from an inferior and otherwise-obsolete mechanism.
38 As popular attention becomes directed to this fact, popular indignation may be increasingly provoked, which in time must bring about constitutional amendment retracting the whole structure of patent monopoly.
39 What happens to the inventor?
40 When large corporations can save vast sums now being expended in patent prosecution and stop wasting the time of the men in their research departments who must review and aid in the prosecution of patents to the exclusion of progressive work, industries will not only be able to afford taking on valid inventors at an adequate salary return, to invent relative to the production problems of the specific industry involved, but will be forced by the ‘‘free for all’’ competition let loose by patent repeal to pay inventors retainer fees in excess of any previously dreamed-of royalties—IDEAS will be at the greatest economic premium.
41 Continuing the discussion of the post-War development of the abstract monopolies in which patents have played a major part, we find that, after entrenching himself behind the allowance of his titular claim to the then dominant long wave bands, Fincap extended his wireless franchise piratical grab to an appraisal of the mechanisms of broadcast and reception. With tremendous financial means available through his ‘‘control’’ of wave bands and his ‘‘protection’’ of the obsoleting physical monopolies, Fincap set about to acquire PATENT control of all the centrally important radio mechanisms: processes, and circuits, as well as of the mechanisms for the production of these end objects.
42 Whatever he could not acquire by purchase, he litigated to obtain. Multi-millions were spent in the fray. Little inventors fell by the wayside. Bigger and stronger patent holders, able to fight for awhile, also finally fell or sold out. With the mechanisms under his complete control and with an army of patent attorneys and scientific researchers, Fincap evolved an impregnable front designed to steam-roller any mushrooming of ideas in the radio field.
43 At this point the radio monopolists were willing to incept broadcasting for domestic consumption.
44 With the intention of reaping high revenue from the sale of receiving instruments, Fincap carefully placed on the market instruments in various stages of compromised adequacy. He could completely control the obsolescence rate and provoke a progression of conspicuous waste, by discard, through advertising the rapidly-obsoleting reception mechanisms. Amateur set-making, which could not dare mass-reproduction sale for fear of infringement, nevertheless grew
45 apace as individual handicraft and was unchallenged because it served to aid in the obsolescence exploitation scheme.
46 Fincap was appalled at the power of the radio to penetrate into every home instantaneously, making it (if it were not for his apparently iron-bound monopolization of the phenomenon) a means of political control that could overnight provoke a popular awareness of Fincap’s untenable abstract monopolies and possibly general revolt from Fincap.
47 Seeking to establish a use precedent that would obviate such an eventuality, Fincap endeavored to limit the use of the broadcast to entertainment purposes only, or innocuous quasi-educational blurbs, or political harangues of a sort useful to his own ends; and last, but not least, for a machine gun fire of advertising interspersing any possibly entertaining program in a manner nauseating to decency and equity that, through exaggeration of every dumbbell proclivity of the populace, has abetted to some extent the sale of his profit-enslaved products.
48 Advertising revenue was not originally contemplated at the time of incorporation of ‘‘N.B.C.,’’ the total issue of stock of which is owned by Radio Corporation. ‘‘N.B.C.’’ was devised as an instrument to limit possible liability in lawsuits arising out of broadcasts, et cetera. Salaries were not contemplated for entertainers. It was thought that amateurs and even professionals would consider the publicity involved sufficiently advantageous to themselves to broadcast without compensation. It is a matter of record that it was a complete surprise to Radio Corporation that ‘‘N.B.C.’s’’ revenue became the vastly dominant earning item of its portfolio, despite astronomical fees to entertainers precipitated through competitive advertising which profitably footed the bill of the mass trespassing license.
49 The national emergency of’32 further called into obvious necessitous use broadcasting as a means of popular reforming from panic trend. Hence political messages were temporarily countenanced. The government, in its reform movement, increased its power of censorship over the radio under emergency precedent, and the administration was given the use of the air that it had previously relinquished to Fincap.
50 Without waiting for the public’s eventual revolt from Fincap’s usurpation of the for-the-public-designed-by-artists-and-inventors radio mechanism, the young amateur radio-inventing world discovered an ‘‘out.’’
51 The ‘‘amateurs’’ penetrated very rapidly into the practically unlimited short wave bands not included in the original ‘‘franchise’’ and which had been by precedent governmentally conceded, through inconsequentiality, as ‘‘open’’ to amateurs. This super-short-wave usage by ‘‘amateurs’’ progressively necessitated more minute and exquisite means both of reception and sending. There developed an imminent need by amateurs of an intercommunicating system requiring minor and domestically available power, such as the Ford motor or ‘‘domestic current,’’ in contradistinction to the costly high powered long wave transmission means available only to interlockingdirectorate-Fincap. Through this abstract and behind the scenes network, the young amateur radio populace soon became integrated in its knowledge and mutual understanding of its progress problem, which involved the potentials of eventual disenfranchisement of Fincap from these last abstract strongholds, of which radio is a typical example and which include aeronautics, the press, telephone, electric manufacture, medicine, movies, and TELEVISION.
52 Television, feared in its potentialities by Fincap, as he has rarely feared a ‘‘new’’ is at present being specifically funded for development through monopolized cable distribution, but an ‘‘out’’ will as always soon occur.
53 A monopolistic integration between the Fincap-controlled press and the radio monopoly was arranged in the early days which restricted the broadcasting of news to such ‘‘news’’ as was at least 24 hours old. However, a minor independent system, employing at first a small non-monopoly-controlled broadcasting station, supplied by world-wide short wave amateur operators, started a news reporting system which was so eagerly listened to by the public that the big monopoly ‘‘family’’ had to break its rule and follow suit in self-defense.
54 And so it goes.