Supreme Court Raises Bar for Patents

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Patent trolls beware. Thanks to a ruling on Monday from the Supreme Court, patents may now be harder to come by. The implications for innovative entrepreneurs could be immense. Entrepreneurs with inventions that are actually ground-breaking may now have more ammunition to fend off copycat products from large companies. On the other hand, entrepreneurs holding current patents may now, in some cases, have a harder time defending them in court.

In KSR Co. v. Teleflex, Inc., the Supreme Court raised the bar for patentable inventions (see Fresh Inc.'s previous coverage of this issue here). The court's main concern was the concept of "obviousness," as in what specifically separates an obvious modification of earlier inventions from a truly innovative product.

The court's opinion, penned by Justice Anthony Kennedy, lays out some interesting changes to the legal test commonly used to defend patents against claims of obviousness. The New York Times sums it up:

"The test requires a person challenging a patent as obvious to identify a reason that would have prompted someone to combine two or more previous inventions, such as published articles suggesting such a combination. This has made it difficult to attack a patent as obvious, and has often precluded summary judgment, instead requiring an expensive jury trial.

Justice Kennedy said that this test, in the Federal Circuit's hands, had led to a "constricted analysis" that paid too much attention to an inventor's motivation and too little to a simpler inquiry: whether "there existed at the time of invention a known problem for which there was an obvious solution."

Here's the counterintuitive criticism of our patent system that the ruling hints at: issuing more patents may actually hinder innovation. By restricting patents to only those products that aren't obvious modifications of earlier products, the court is shifting the economic rewards of IP protection to the truly innovative. Presumably, the changes offer more incentive for entrepreneurs to come up with ground-breaking inventions.

Do you think innovative entrepreneurs will benefit from these changes to our patent laws? How important are patents and IP protection to your business? Will the newly raised standards for patentable inventions ultimately benefit big business or entrepreneurs themselves? Do fewer patents mean more innovation?