Transcript for Darin Gibby on Why America has stopped inventing

Jim Fleming:  “Has America stopped inventing?”. That is the provocative title of a book by Darren Gibby. Gibby is patent lawyer and points out that Americans invent less than half of what we did a century ago. Half. Why? Are we less creative than we were 100 years ago? Gibby says the problem lies in one place and one place only. The US patent system. He tells Anne Strainchamps that the current system has got to go.

Darren Gibby: What the thing that was really frustrating to me was I see these inventors come in to my office really exuberant, have some great ideas, and I was the one who was breaking the bad news to them to say, “hey look, you have a good idea. But, in order for you to protect your idea, it is going to cost you around 30000 dollars to get your patent and it will take you about five years to work its way to the patent office, and then even worse, once you do get your patent, if anybody tries to copy your design, and you need to bring a patent infringement suit, it is going to cost you two to five million dollars to be able to stop them. Now, the ordinary American, these numbers are so large. It is impossible for anybody to do that and without that kind of protection, there is really no way that they can come up with an invention and be able to successfully market it.

Anne Strainchamps:  So, you are a poor inventor who walked in with his brilliant idea scribbled on a napkin, must be wondering how anyone ever built or made anything new or original in America. I mean, how did we get here? Were patents always been this hard to come by?

Gibby: That is a great question. The answer is no. It used to be relatively easy to get a patent. Back in 1836, they built a new patent office, they got a patent commissioner whose name was Henry Oswald, whose father was actually one of the Supreme Court justices and they wanted to be able to come up with a system where the average American could quickly get a patent and will be able to enforce it. So the cost of getting a patent in 1836 was about 30 to 40 dollars and it took around three months. And then, once you wanted to enforce your patent, the most expensive case back in the 1850s was handled by Daniel Webster, while he was secretary of state handled the Goody Robert case and he charged 10000 dollars. People thought that was so outrageous that he could do that, but you look at how much it was then verses now and it almost seem trivial. And, when you look at the numbers, back in the 1830s through the 1850s, America invented twice what it does now. That is a shocking statistic. We invented twice what we do now.

Strainchamps: You make the comment in the book, you say, for these early inventors, inventing was their religion, meaning it wasn’t just a hobby. It was an actual obsession. There you sort of suggesting that inventing was a religion for America too. That it was really a central part of the country’s identity.

Gibby: I really think it was, and if you look at the mid 19th century, everybody loved to invent. Everybody who wanted a piece of the action. One of my favorite stories is with the reaper case. Once they had invented the reaper and it was out in all the farmers were using it, they would tinker with it all season long. Because, it wasn’t perfect. And, what they would do is at the end of the season, they would use all their ideas and they would take their ideas and file for patent application. And, McCormick was a genius at marketing. He lost his patent case, but he learned that the whole Unites States is my R & D department. So, he would send out these patent scouts from his company at the end of each season, he would find the best inventions, he would buy them up, and then over the winter, he would incorporate them in to his new models and by the spring, he would have a whole new line of reapers. But, the great part about this is the inventors were not part of the company. They were just average Americans doing what they do, which is inventing.

Strainchamps: That makes me think of there is a phrase I have heard, a patent troll

Gibby: Yeah. Patent trolls are a real problem today. What a patent troll is somebody who really doesn’t have a business behind the company. They just go out and they buy a patent or they file for their own patents, really without an idea, they just kind of put on paper some hair brained[sp?] idea work its way through the patent office and then they try to claim that it covers the something that it doesn’t. And, most of these patent trolls today claim that they have patents to cover almost any kind of business over the internet. When you read these patents, you cannot understand what they are saying. But, how these people operate is that they know that it costs 2 to 5 million dollars to defend against a law suit. So, they sue hundreds of people at a time. They will say, our patent cover your way of selling goods over the internet, and if you pay me say 50000 dollars, we will just settle the case right now. But, if you don’t settle, we are going to take you to trial and you are going up spend 2 to 5 million dollars. And so most companies, they are held high way robbers. They are cut throats. Because, it is cheaper to pay this guy 50000 dollars than to hire a law firm and spend 2 to 5 million dollars.

Strainchamps: You know, lot of the stories you told from the early days of American invention, the golden age. The stories of individual guys who on their own, with no particular equipment or giant lab or company behind them, just tinkered and worked until they came up with something. Charles Goodyear, Henry Ford, the Wright brothers, they didn’t have corporations behind them, but the picture I am getting is that today you can’t come up with a new invention, or successfully defend it unless you got the strength and the big pockets of a major corporation behind you.

Gibby: That is right. There are two issues there is. One, can you invent without a big corporation and the second question is do you need a big corporation to be able to move you through the patent the system. The answer to the first question, I think, people can invent even without a big law behind them, a great example I saw is in the new York times a couple of weeks ago was with this woman who while in high school was at a VA hospital and saw this issue of referred pain with amputees from the war. And so she came up with this idea of being able to heat the limp when they had this referred pain, so that they can get rid of it, and what she did is she wrote to a bunch of engineering universities and asked for help with her idea and there is a number of them who are willing to help her out. Now, she got the little company, she is going to go to the law school, nothing about technology, but she came up with the idea. Where we were really falling short is now we have these ideas we need to protect them. We need to be able to move them on to where they can be brought in to products. And that is really where a patent system has failed us.

Strainchamps: Without getting too technical, can the system be fixed?

Gibby: Oh, I think it can. And, I think, all that we have to do is go back to 1836 in the patent act we had there. It was so sympathetic to get a patent application to the patent office and so simple to enforce it. What we have done in the 150 years since then ironically is we layered doctrine after doctrine in an effort to make the system fair, and while it may be somewhat more fair, it just taken it out of the range of the ordinary inventor. So, let us go back a 150 years ago to what we had, what worked and I think you will see the same ground swell of invention that you did back then.

Jim Fleming: Darren Gibby is the author of “why has America stopped inventing ” . Anne Strainchamps spoke with him.