Even if lawyers can predict outcomes, investors and entrepreneurs can’t
Paul Michel and Judge Kathleen O’Malley, 24 – Judge Paul Michel (ret.) served on the United States Court of Appeals for the Federal Circuit from 1988 to 2010. Judge Kathleen O’Malley (ret.) served on the United States Court of Appeals for the Federal Circuit from 2010 to 2022 and the U.S. District Court for the Northern District of Ohio from 1994 to 2010. Both are board members of the Council for Innovation Promotion. “Congress needs to clean up the Supreme Court’s mess on patents” The Hill, 3/13, Nexis Uni, accessed via University of Michigan //DH
Some defenders of the new status quo have denied there is a problem at all. One study even suggested that “under one of the most well-established metrics for measuring the predictability in the law, Section 101 proved to be more predictable than other areas of patent law over the past decade.” That is, lower court decisions, usually of ineligibility, were rarely overturned on appeal. But that is unsurprising because of the ambiguity of the law.
The study is also misleading. While it may be true that expert lawyers can predict the likely outcome of Section 101 disputes — which generally involve finished products that have already been brought to market — startup companies are not making research and investment decisions based on finished products.
They, and their investors, are making those decisions based on the reliability of intellectual property protections for inventions that are so early-stage, they often exist only on paper. If there is any doubt about whether those inventions can be protected, entrepreneurs and investors will inevitably err on the side of caution — and direct their resources to other sectors.