Why Congress Keeps Screwing Up Tech Policy
This bill focused on the standard, and extortionate, business model of “patent trolls.” They buy other people’s patents instead of applying for their own, and then use those patents to shake down big and small companies, and even local governments, with vague threats of infringement. A 2012 study by two Boston University researchers estimated that this conduct sucked $29 billion a year out of the economy in litigation costs and licensing fees alone.
To fight that abusive behavior, the Innovation Act would require that if you hit a company with a patent suit, you’d have to say upfront just what it did to infringe specific claims in your patent. Also, you couldn’t hide who’d profit from your lawsuit, which is another standard part of the model, as NPR documented in a damning 2011 report. And if you lost, the judge could make you pay the winner’s costs.
The Innovation Act — endorsed by the White House as well as Republicans who agree with the Obama administration on little else — was far from a war on patents. And yet the Judiciary Committee’s leadership botched the job: Wednesday, Chairman Patrick Leahy (D-Vt.) announced that because there was “not sufficient support behind any comprehensive deal,” the committee would set aside the bill.
Reports by The Washington Post’s Brian Fung, National Journal’s Dustin Volz, and Vox’s Tim Lee soon added a backstory to that airy statement: Senate Majority Leader Harry Reid (D-Nev.), facing complaints by trial lawyers over the loser-pays provision, and other provisions that might undermine lawyers’ practices if applied outside patent suits, pushed Leahy to scuttle the bill.
Should we be surprised?
The Innovation Act’s demise this year, at the hands of old-school special interests, represented a punch in the gut for many tech advocates. But it shouldn’t have been a surprise, given the technology industry’s low batting average in Washington.
Read more: Five Tech Policy Bugs Congress Needs to Fix
When it comes to the politics of bits and bytes — things like patent reform, electronic surveillance, net neutrality, data breaches, and cybersecurity — Congress can start to look like a broken Magic 8-Ball. Its answer is almost always “Ask Again Later.”
For that, blame a few factors that don’t seem likely to change soon.
The obvious issue can be seen from sidewalks in Capitol Hill: The lobbies representing incumbent industries occupy buildings that are bigger and closer to the White House or Congress, and they’ve been in them awhile.
No elected official has to wonder who speaks for movie studios, record labels, or broadcasters. But Internet startups and even more established dot-coms don’t have obvious, must-be-heard voices in Washington.
“The tech community … is just starting to do that,” wrote Jennifer Hoelzer, a former staffer for Sen. Ron Wyden (D-Ore.), one of the smarter lawmakers in tech policy. “The interest groups it’s up against have been doing it well for decades.”
The Consumer Electronics Association and the Computer and Communications Industry Association (disclosure: I’ve written about tech policy and industry issues for both groups) have tried to step in. So have newer industry groups like Engine or The Internet Association as well as nonprofits like Public Knowledge, the Electronic Frontier Foundation, and the Center for Democracy and Technology.