The document discusses the issues around software patents in Denmark and Europe. It notes that while patent law was originally intended to encourage innovation by granting limited monopolies, today's abundance of inventors and inventions has led to problems. Studies show the costs of patents now outweigh the benefits, largely due to patent trolls acquiring vague software patents and demanding licensing fees from practicing entities. The European Patent Office has pushed for expanding software patents through directives and unitary patents, against the objections of countries like Denmark, who risk losing autonomy over their patent system.

1.
Danish software patents:
to be or not to be?
glyn moody

2.
inventive scarcity
 patent law was framed in a world
with few inventors, and few
inventions
 monopoly was offered
 to attract foreign master
craftsman
 to make technical knowledge freely
available after monopoly expired
 to stimulate local industries
 to encourage more inventions

3.
inventive abundance
 today, we live in an abundance of
inventors and invention, as the
creaking patent system shows
 in 2012, 469,000 patent
applications filed with USPTO;
258,000 in Europe; 11,000 in
Denmark
 in March 2013, USPTO *granted*
6,000 patents in a single week
 "30% of US patents are for things
that have already been invented."

4.
benefits & costs of patents
 Bessen, Neuhäusler, Turner and
Williams (2014)
 looked at costs and benefits to US
companies of patents 1984-2009
 total benefits - $385 billion
 total costs (e.g. litigation) -
$538 billion or $1,490 billion
 order of magnitude: $1 trillion
 Bessen et al. looked at how things
developed over time

5.
something happened
 source: Bessen et al. (2014)

6.
enter the patent trolls
 Non-Practising Entities (NPEs)
 typically buy patent portfolios
 demand licences/threaten to sue
Practising Entities (PE)
 have no products, can't be sued
 no independent invention defence
 mount a defence in court costs $2-
5 million fees; most settle
 1984-99: PE - 88%; NPE - 12%;
 2000-09: PE - 39%; NPE - 61%

7.
super patent troll
 Intellectual Ventures
 founded by Nathan Myhrvold
 owns 35,000 patents
 raised $5.5 billion from
Microsoft, Intel, Sony, Nokia,
Apple, Google, Yahoo, American
Express, Adobe, SAP, Nvidia, and
eBay
 computer-related patents cases
 1984-99: PE - 17.2%; NPE - 5.4%
 2000-09: PE - 12.1%; NPE - 32.6%

8.
software patents
 obvious – Wang's overlapping
frames/windows
 trivial – Amazon's 1-click
 ridiculously broad
 E-Data: ”system for reproducing
information in material objects at
a point of sale location” (1985)
 generic e-commerce sites sued
 lack of well-defined boundaries
 intentionally blurred by lawyers

9.
the key problem
 abstract – patent of maths/idea
 often impossible to code around
 copyright is more appropriate:
protects only the particular
expression, not the general idea
 uniquely, software is patentable
*and* copyrightable - anomaly

10.
software patent
infringement
 software depends on thousands of
components/"inventions"
 more complex it becomes, more
"inventions" it depends upon
 patents are monopolies to exclude
others from using an invention
 if you can't code around it, you
only need one "infringement" to
block entire program/product

11.
patent litigation
 source: Techdirt (2010)

12.
smartphones: just the start
 2012: $20 billion spent on
smartphone patent litigation and
purchase in previous 2 years
 2011: Apple & Google spent more
on patents than on R&D
 US smartphone patent thicket
 2000 - 70,000 relevant patents
 2012 - 250,000 relevant patents
 smartphone is phone+computer
 Internet of Things: thing+computer

13.
US software patents
 “If people had understood how
patents would be granted when
most of today’s ideas were
invented, and had taken out
patents, the industry would be at
a complete standstill today.”
 “some large company will patent
some obvious thing” and use the
patent to “take as much of our
profits as they want.”
 Bill Gates (1991)

14.
EU software patents
 EPC (1973), Article 52:
 "(1) any inventions, in all fields
of technology, provided that they
are new, involve an inventive step
and are susceptible of industrial
application."
 the following in particular shall
not be regarded as inventions:
 "(2c) schemes, rules and methods
for performing mental acts,
playing games or doing business,
and programs for computers"

15.
"as such"
 "Paragraph 2 shall exclude the
patentability of the subject-
matter or activities referred to
therein only to the extent to
which a European patent
application or European patent
relates to such subject-matter or
activities as such."
 "as such" opened up huge loophole
for European software patents

16.
computer-implemented
inventions (CII)
 computer-implemented invention
 "one which involves the use of a
computer, computer network or
other programmable apparatus,
where one or more features are
realised wholly or partly by means
of a computer program."
 in 2002 30,000 had already been
issued in the EU

17.
*not* software patents
 transforming file names
(EP0800142)
 tabbed software palettes
(EP0689133)
 generating buying incentives from
cooking recipes (EP0756731)
 pay per use (EP0538888)
 online sales (EP0803105)
 etc. etc. etc.

18.
European Directive on CII
 Directive on the patentability of
computer-implemented inventions
(2002)
 Denmark was against, ignored by
European Commission
 6 July 2005: European Parliament
voted against it by 648 to 14
 in favour: Microsoft, IBM,
Hewlett-Packard and European
Patent Office (EPO)

19.
European Patent Office
 membership not coincident with EU
 38 member states, not 28
 supranational body enjoys extra-
territoriality
 offices are "inviolable": local
authorities can only enter with
permission of EPO President
 funded through its services
 vested interest in widening scope
of patents, incl. plants, GMOs -
and software patents

20.
Unitary Patent
 EPO handles
 European patents and European
patents with unitary effect
(Unitary Patents)
 European patents can also add
unitary effect afterwards - open
floodgates of CII patents
 national patents remain an option
 race to the bottom
 companies will choose whichever
gives widest monopoly

21.
Unitary Patent Court (UPC)
 Court of First Instance in
France, Germany, UK
 local courts in Denmark, Sweden
 Mediation in Portugal, Slovenia
 Court of Appeal in Luxembourg
 EUCJ for "rulings on Union law"
 key: national courts play no part
 Spain, Italy, Bulgaria, Poland
all have reservations

22.
Polish concerns
 Unitary Patent fees may be higher
than national ones
 could lead to flood of foreign
patents applying in Poland
 more licence fees for Polish cos.
 more litigation against Polish
companies, in other EU courts
 could see national patent court
fading away; loss of autonomy,
loss of national culture

23.
something rotten?
 Unitary Patent will bring more,
worse software patents to Denmark
 Denmark will lose its autonomy:
must accept EPO's patent rulings
 Denmark sceptical about Directive
on the patentability of CII
 wise to be sceptical of UPC
 adopt the Polish plan: before
ratifying, wait and see if
Unitary Patents are better

24.
that is the question
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