Patent invalidation causes economic decline

The rate of patent invalidation in the United States appears to be increasingly high. 34Link to the text of the note Nearly forty-six percent of all patents litigated to judgment are held to be invalid. 35Link to the text of the note Due to this, scholars have identified multiple reasons that lead to the invalidation of patents. At first glance, guilt falls on the inefficiency of the system for granting patents. 36Link to the text of the note The Patent Office is routinely criticized as being a "rubber stamp" for patents and frequently issuing the majority of applications. 37Link to the text of the note Another factor, more pertinent to assignee estoppel, involves the vast changes in substantive patent law on which a patent can be invalidated. 38Link to the text of the note Academics have noted that "courts at different times could reach opposite decisions on the validity of the same patent based on the relevant patent laws of that particular period of time." 39Link to the text of the note Yet allowing such validity challenges serves the public's interest in the free flow of ideas. 40Link to the text of the note It also provides an outlet that relieves the public from the ever-evolving patent laws of the United States that, at any point in time, could place the public at the mercy of paying for an invalid patent. 41Link to the text of the note

An alternative view suggests that the public policy encouraging patent validity challenges has run its course. 42Link to the text of the note Economic uncertainty in the patent system can stem from an open season of validity challenges, thereby deterring potential investors or patentees from entering into long-term research and development commitments. 43Link to the text of the note A slippery slope could, in effect, result in decreased investments in technology and cause a spiraling economic decline. 44Link to the text of the note While the possession of unreliable and invalid patents has resulted in a loss of confidence in the past, [*201] remarks from the patent community note that this barely inhibits competition in the United States. 45Link to the text of the note And yet, parties continue to pose validity challenges. More recently, the Supreme Court, in Oil States Energy Services, L.L.C. v. Greene's Energy Group, has buttressed this policy concern by upholding alternative administrative forums for patent validity challenges. 46Link to the text of the note With more options available, patent validity challenges remain extant in the realm of patent law, even for an assignee.

For assignees subject to assignee estoppel, the legislative history of § 261, and the entirety of the Patent Act, is silent with respect to whether an assignee can undergo a validity challenge of its own patent. 47Link to the text of the note The Senate committee report accompanying the Patent Act of 1952 only reports that the language of § 261 was derived from the prior statute of 1836. 48Link to the text of the note This legislative silence indicates that Congress most likely did not consider a situation where an assignee would want to challenge the validity of its own patent.