Patent Reform is a Key to Republican Victory in 2016

Mytheos Holt
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Posted: Jul 23, 2015 12:01 AM
Patent Reform is a Key to Republican Victory in 2016

As the race for 2016 heats up, Republican contenders for high office at all levels will be asking themselves a simple question: How do we expand on our demographic and outreach success of 2014, in order to build a truly lasting coalition?

The necessary precondition for this to happen is not to backslide on anything that brought people into the 2014 coalition in the first place.

So, if you were a Republican lawmaker and someone came to you with an issue that had made one of the Democrats’ main fundraising bases go red in 2014 when they failed to resolve it, and that is primarily opposed by Left-wing rent-seekers, including the architects of Obamacare, you would probably think that issue was a slam dunk.

Here’s the catch: The scenario I have just described is not some hypothetical policymaker’s fantasy. Such an issue really exists. It’s called patent reform.

For those who don’t know, patent reform became a live issue during the last Congress due to the burgeoning problem of “patent trolling.” This term refers to the tendency by some companies to use the patents they own as a means of extorting legal settlements from alleged infringers by holding the threat of a lengthy and expensive trial over their heads. This usually takes the form of telling the target of such suits “pay us x or we’ll bankrupt you in court.”

What distinguishes legitimate innovators trying to protect their inventions from patent trolls is that trolls usually make no attempt to profit off the idea they’ve patented -- say, by inventing a new product. Rather, they use it solely for legal extortion. There’s even a technical term for firms that engage in this strategy: non-practicing entities, or NPEs. It should surprise no one that some of the biggest targets of NPEs are extremely wealthy companies that in any other situation, we’d consider bywords for innovation. Steve Jobs’ brainchild Apple tops the list, as do any number of other Silicon Valley giants.

Needless to say, this kind of bad faith patent litigation produces real costs for the companies who are targeted by it, with no discernible value being produced. Even Sen. Chuck Schumer (D-NY) referred to patent trolls as “leeches.” When even Chuck Schumer thinks you’re a leech, you probably need to lay off the bloodsucking.

Patent reform had such a high degree of bipartisan support in the last Congress (not to mention the fact that 500 tech firms supported) that it seemed all but assured that this issue would be solved. Unfortunately, there was one big obstacle: Sen. Harry “Why We Can’t Have Nice Things” Reid (D-NV). Reid blocked patent reform solely on the grounds that trial lawyers, a reliably Democratic coalition, hated it.

But for every lawyer that Reid assuaged, there was an angry Silicon Valley CEO, and as a result, more than half of Silicon Valley donations in 2014 went to Republicans, a complete about-face from 2010.

Flash forward to today. Now that there’s a new sheriff in town, you would think that patent reform would’ve been whisked out of the way in order to ensure continued goodwill from one of America’s last remaining growth industries. But you’d be wrong. Patent reform -- in the form of Rep. Bob Goodlatte’s (R-VA) “Innovation Act” -- is still on the docket, but it’s run into trouble. The trial lawyers are out in force, of course, but this time the main source of opposition seems to come from Big Pharma, aka the people who gave us Obamacare. They contend that the Innovation Act will make patent lawsuits prohibitively expensive, and damage small businesses and innovators. Both of these arguments are flat-out lies.

Meanwhile, for the actual abusers of the patent system, business is booming, with more patent lawsuits being filed than ever before, of which the lion’s share come from trolls. And Silicon Valley is getting impatient, with its CEOs recently out and out demanding that Congress take action on this issue. If it fails, there is nothing stopping them from giving up in disgust at both parties and simply reverting to being a blue coalition on the basis of social issues (where the Valley still leans monolithically Left).

To let this happen would be a terrible tragedy, not least of all because Silicon Valley faces any number of other issues where the Left’s traditional coalitions are trying to undermine its interests (race and class hustlers don’t do well against the Valley’s logic and data-driven mindset). Republicans could capitalize on this, but in order to make a convincing case, they need to see Republicans as an effective shield against the Left-wing leeches who keep trying to steal their money and infect their workplaces. Defeating trial lawyers and big pharma would go a long way to showing that the GOP is serious about cleaning up threats to American innovation.

2016 already looks to be shaping up to be a contest between candidates who offer bold, new, innovative leadership, and those who want to repeat the same old failed politics of the 60’s or the 90’s. A Republican party bolstered by Silicon Valley money and talent could mop the floor with a Left whose non-ideas only sound good when backed by a Hollywood soundtrack. So face the music, Republican congressional leaders, and get patent reform done before the trolls can sneak back under their Bridge to Nowhere.