By Donald Zuhn —

In an op-ed piece in today’s Wall Street Journal, L. Gordon Crovitz opines that Congress’ failure to enact patent reform this year has undermined the Constitutional mandate to encourage innovation (see "Patent Gridlock Suppresses Innovation").  The fault for our flawed system, according to Mr. Crovitz, rests with Congress, which he believes "[f]or the third year in a row . . . has just given up on passing a law reforming how patents are awarded and litigated."

Mr. Crovitz (at left) leaves little doubt as to which team he backs when he discusses the efforts of the Allied Security Trust, an industry consortium that has begun to buy up patents in order to keep them out of the hands of dreaded "patent trolls" (when Mr. Crovitz notes that the Allied Security Trust includes "[c]ompanies as diverse as Verizon, Google, Cisco and Hewlett-Packard," one wonders what definition of "diverse" he is using).  While Mr. Crovitz asserts that our current patent system has become "patently absurd" for most innovations, it is clear that he speaks for the "software and other technology companies" — which he expects "to be the growth engine of the economy" — and not for the biotechnology and pharmaceutical industry.  For example, when Mr. Crovitz contrasts the pharmaceutical industry’s self-centered reasons for lobbying against patent reform legislation with pro-reform lobbying conducted by technology companies, he argues that the latter were "worried more about uncertainty in the law than about the value of their patents."

According to Mr. Crovitz, "growing" evidence indicates that "for most industries, today’s patent system causes more harm than good."  However, the only evidence Mr. Crovitz cites in his article is James Bessen’s and Michael Meurer’s book "Patent Failure," which Mr. Crovitz contends establishes that the costs of U.S. patent litigation to alleged infringers ($12 billion in 1999) outweighed the profits companies earned from patents ($4 billion in 1999).

Mr. Crovitz enumerates the problems he believes plague our current patent system.  In his view, these include an "uncertainty about who owns what rights," "poorly defined property rights for inventions," the issuance of "increasingly broad and vague patents," the inability of companies to know whether or not they are complying with patent law, the perpetuation of a first-to-invent standard over a first-inventor-to-file system, "a still-primitive system for notifying others of the existence of patents," and a squeezing out of small inventors by companies that "only pay for rights they think the system will protect."

A cynic might suggest, after reading this latest attack on the U.S. patent system, that if Mr. Crovitz were forced to choose, he might pick unfettered access to his Blackberry device over access to new pharmaceuticals.  And while that might be fine for him, it’s not a choice the rest of us may be willing to make.

Mr. Crovitz served as executive vice-president of Dow Jones, where he launched the company’s Consumer Media Group, integrating the print, online, television, and digital editions of The Wall Street Journal, MarketWatch.com, and Barron’s.  He left Dow Jones in December 2007, when Dow Jones was acquired by News Corp.

For additional information regarding this or other related topics, please see:

• "The Wall Street Journal’s Problem with the U.S. Constitution," November 14, 2007
• "The Wall Street Journal Gets It Half Right," November 5, 2007