Giachino (00:04.0969 - 00:44.0999)
Thank you for tuning in to IP Protection Matters. My name is Renee Giachino. I'm Corporate Counsel for the Center for Individual Freedom. Joining us is Jim Edwards. James Edwards is the Founder and CEO of Elite Strategic Services where he consults on intellectual property, antitrust and health policy. He plays leadership, strategic and advisory roles on Intellectual Property (IP), particularly on patents. He joins us today to talk about his new book, which is hot off the press. It is titled, “To Invent Is Divine: Creativity and Ownership.”
Jim, welcome back to the program. Thank you so much for joining me.
Edwards (00:45.0000 - 00:47.0669)
Thank you for having me, Renee. It's great to be back.
Giachino (00:47.0900 - 01:20.0239)
You note in your acknowledgements at the beginning that the inspiration for your book came from a speech that you did in Dallas some time ago. Let's back up and let me ask you what inspired that speech, because this is a fascinating topic that you have written about — the intersection between spiritual writings and the Bible and patent law or IP protection. So what inspired that speech?
Edwards (01:20.0809 - 03:13.0490)
I was at a leadership retreat with Eagle Forum Education Legal Defense Fund's leaders around the country. That's one of my clients and I'm the patent policy advisor for that organization. The Texas leader and I started talking and I was telling her about what I did for the organization, which is patent policy. She got kind of interested in learning about patents, invention and so forth, [and she got] curious as to what the biblical basis or association there might be with all of that side of things. She said why don't you come and give a speech at this Sunday evening class that I help to lead. We will have you and you can talk about patents and invention from a biblical framework.
So, I spent the next few months examining what I had kind of a sense of. But I hadn't really put a lot of thought into developing an understanding of the biblical basis. And so it became clear that creativity and ownership are really big themes throughout the Bible. So that's what I conveyed in the speech. When I got back to Washington and told a friend how well it had gone. I said patents a few times in that speech and nobody's eyes glazed over so we were off to a good start. He said you ought to turn that into a book, so I started that at that point.
Giachino (03:13.0860 - 03:33.0529)
A tremendous undertaking, no doubt. In the title, interestingly, “To Invent Is Divine,” you give the terms creativity and ownership a lot of play, as well as throughout the entire book. Are those terms interchangeable in your mind with invention and patenting?
Edwards (03:33.0800 - 03:43.0279)
I'd say not interchangeable, but that invention and patenting are a subset of those broader categories of creativity and ownership.
Giachino (03:43.0720 - 04:12.0630)
The premise of your book, which you sort of summed up for us just a moment ago and you aptly state in your first chapter, is that human creativity reflects the creative characteristic of God the Creator. How does understanding the foundational biblical principles of God's creativity and ownership of His creation help us to better understand and relate to both creators and society today?
Edwards (04:12.0910 - 08:23.0265)
I think it helps to broaden one's understanding of creativity, ownership and what happens when those are either connected or disconnected. The truth is that God throughout scripture is asserted, by himself and by others, to be the Creator of the heavens and earth and all that is, including human beings. It goes on to say that human beings, and we need to understand ourselves and what helps and makes humanity what we are, are made creative bodies, too. We're the only creation that God endows with those same communicable attributes of creativity and ownership. Just like he endows us uniquely apart from other parts of creation with language and rationality and those kinds of communicable attributes.
It helps us to understand God as the Creator and God as the owner of all that he created. Then you start to look at, well, what did God do with Adam in the Garden of Eden? God told Adam to work and keep the garden. He's the caretaker. He's the steward. He's to make things of creation. To work is a positive thing. It's a gift. It's something that we are called to do, but it's also something we are able to do. We are empowered to do.
Our work as human beings glorifies God, but it also serves humanity in the sense that if you have the ability to create, and let's say you're an inventor and you are able to do so creating in electronics or mechanics, then you're making things and you're solving problems with those faculties that God has given you and applying knowledge that other human beings have discovered. God provided and then you were trying to turn that invention into something commercially viable. So you're making a product out of it. You're making some kind of a device out of it. You have to be able to own that thing that you created if you're to be able to make that success occur.
There's no success commercially if there's not secure ownership, and that is something that shone through from Genesis to Revelation and everywhere in between in my study. It was amazing and enlightening, but also awe inspiring just how God pulled all those components together. The formula that he created is creativity plus ownership equals human flourishing. If we have ownership but not creativity then the innovation is lacking. If we have creativity without ownership then there's not much new creating being done because the rights of ownership are being taken away or are under threat. So it's really important if you want human flourishing and you want the improvement of the human condition to be an ongoing enterprise that you need to have creativity and ownership connected. That boils down to inventions and patents and protections for writing, artistic works and copyrights.
Giachino (08:23.0265 - 09:51.0849)
You write that our Founding Fathers clearly had the intent in the Constitution’s IP Clause to promote the progress of science and useful arts. That has evolved into what has been referred to now as the patent bargain of exclusivity, particularly in exchange for disclosure. You write about that in part one of the book.
You also include in there a discussion of how every individual has some creative ability and how that creative ability combined with human flourishing translates from the individual to collaboration to institutions to societies. But today we are seeing evidence, unfortunately, of instances where the ability of the innovators to maintain their property rights is being dismantled.
Take us through what you are seeing. Let's start with what some folks are trying to do as it relates to the Bayh-Dole Act from 1980 and the impact that it had some decades ago but now is trying to be unraveled. What are you seeing there? Bring us current with the status of efforts that you're seeing to erode the rights of individuals to the fruits of their intellectual labor.
Edwards (09:52.0059 - 13:13.0919)
Let’s start with the Bayh-Dole Act of 1980. Forty five years in and people have over the course of time appreciated it and then forgotten its lessons. The lesson is that before the Bayh-Dole Act, the federal government poured zillions of dollars into research. It is research done by corporations. It is research done by small businesses. Research done at universities, most of which is some form of basic research. It's foundational knowledge. Then parts of that promise to be patentable. So some of it does get a patent on it. Maybe it's a process or something that you've discovered or invented or a medical diagnostic or something.
Before the Bayh-Dole Act, the government owned like 28,000 patents and less than 5% were attempted to be commercialized. There was no practical benefit for the American taxpayer who's underwriting this terribly huge amount of research going on. There's knowledge that's sitting on the shelf with no practical benefit. So the Bayh-Dole Act deliberately used the patent system and its exclusivity of rights to democratize the rights of that intellectual property to the entity at which time the research grant was given and the learnings were found.
The universities spawned the Bayh-Dole Act. They spawned the vast technology transfer system that's developed as a result of that law. That means most major universities have technology transfer offices. Their job is to assess the technology that's developed out of the academic side of the university. They then try to license the most promising of those to companies or startups. So it's a virtuous circle of federal dollars funding research that's basic research, basic knowledge, and then the university's tech transfer office takes it into the marketplace and finds someone who's willing to put up the effort and the investment to make a go of commercializing that invention into something that is practical for society, whether it's a a pharmaceutical product, a variety of a plant or some kind of a computer implemented invention. All of the above and more. It's been a phenomenal change from the wasted research dollars where nothing was benefiting the taxpayers and the public to something that really is a difference maker in our economy.
Giachino (13:14.0320 - 13:53.0309)
Our guest is Jim Edwards. He's the author of “To Invent Is Divine Creativity and Ownership.” In the book, you've broken it down into three parts and made it really easy for folks to follow. The first part is on creativity, which we've talked about. The second part is on ownership, which we also dove into a little bit.
I want to now turn to part three where you write about the patent ecosystem. I think it's really important for people to get a basic understanding of that terminology. Can you define for us what is meant by the patent ecosystem?
Edwards (13:53.0429 - 17:23.0670)
With anything, there's going to be a sort of ecosystem and a place where certain things happen that foster the growth and development of certain things. If you're talking about an ecosystem in nature, it could be where certain types of fish or animals thrive, and they don't survive in other types of environments. There is a similarity in the ecosystem for patents. As I was just saying about the Bayh-Dole Act, around that law there became a need to transfer the technology from the university to the market. The technology transfer job category became something that has proliferated ever since. There's the need for office space for startup companies that are commercializing the various inventions from a given institution.
If you look at Boston, if you look at really anywhere around any university that has a tech transfer office, there are going to be things that weren't there 40 or 45 years ago because it was built up around it. There's a need for office space. There's a need for certain types of consulting. There's a need for certain entities that can produce prototypes. All of those kinds of things build up around an area. One in particular comes to mind that is in the Clemson University area. Greenville, South Carolina has a lot of automotive and manufacturing. Then you've got Anderson, South Carolina, which is a tiny city, but it's also where there's a real hub of material science, such as Polyamide, which is a great example of a tech transfer out of research at Clemson. It's a tiny town and it's a tiny company, comparatively, but it's vital in material science related to medical technology.
That is just one piece of the ecosystem in that small area. You’ve got the Bay Area in California. All these places have had these entities build up around it - businesses, consultants and vendors of all sorts of things. Then you've got to figure out the various parts of getting the commercial item to market. All of that tends to collect around the location where this is proliferating from. So that's what the ecosystem is. That includes investors and so forth.
Giachino (17:24.0079 - 17:49.0910)
In that chapter, you also provide a historical basis and a timeline of patent law evolution, which brings us to current day, as you've just discussed. What do you see today as some of the biggest threats to IP protection? Do you believe that we're condemned to repeat history when it comes to potentially losing our innovative global leadership as it relates to IP?
Edwards (17:50.0510 - 21:35.0219)
I don't think we're condemned to it. I think we're threatened by the prospect of forgetting history. In Clause 8 of Article I, Section 8 of the Constitution, the Founding Fathers put in there exactly what they wanted. They said we want to stimulate progress in useful arts and science. We want to stimulate this progress for our economy and our country's benefit. We need to grow out of the simply agrarian economy into something that's more manufacturing and more technological. So, they put in there and the exclusivity that is granted to securing the rights for inventors and authors as the Constitution says.
The [Patent Act of] 1790 was the first patent act to be put into law in the United States. It derived in part from several states that had already adopted their own patent laws after independence was gained during the Articles of Confederation time. But the 1790 law under the US Constitution set up a system where it was actually cabinet members who were the patent examiners. They did it like one day a month, and it wasn't terribly efficient. And then in 1793 there was an adjustment there with the 1793 Patent Act, which kind of pulled the reigns off of things and let things go kind of wild. You're registering with the State Department what your invention is and there's some degree of of patent examination, but it's not robust and and it kind of leaves it to the courts to sort through all of the facets of any patent disputes.
The 1836 [Patent] Act was what I call the golden age of American patenting. From 1836 it is in some ways ongoing until now. But that's the one that more formalized objective quality and the right balance of patent examinations. It built a building in Washington, DC to house the patent office. It is now part of the Smithsonian. It had a huge patent library and housed all the patent models that inventors sent to accompany their patent. You had to have a working model for a certain time. I think 1890 or thereabouts is when it was no longer required to provide a model. But the public would go into the patent office building just to marvel at all the inventions. That's the building where the lawyers putting patents through the process would go for the iconic inventors like Edison, Tesla, the Wright brothers and so forth.
Edwards (21:35.0479 - 26:40.0869)
All of those kind of inventors were well-known people in the US at that time. They were well-known because invention was making a huge difference in advancing America's society and our quality of life and our economy was expanding. It was tremendous and the reason it worked is because the Founders democratized patent awards. They're not granting rights like the king would grant a right basically to cronies in the old country, but we're looking at this invention objectively. We're not looking at who it was or the qualities or characteristics of who invented it. We're looking at the invention to see if it's meritorious. Does it work? Is it novel?
You take that, and yes there may be patent litigation around some of that over time - there always has been because when something is valuable, people are going to fight over it. The same thing has happened out West forever over water rights. You don't think of water in the East as a scarce resource, but out West it sure is. Water is highly valuable, and more so in some places than others, but it's highly valuable. If you've got something that's the telephone or the telegraph, you’re going to debate whether that guy is the true inventor of this and if yours is the original invention or better.
So those are the kinds of things that need to get sorted out. That's provided for through the legal system. But after the 1836 [Patent] Act, the patent system was pretty much the same until 1980 when we got a handful of really important patent laws. The patent system had kind of become captured by big government during the 40s, 50s, 60s and 70s through funding huge sets of corporations to do research and development and getting the grants. The government actually weakened rights of ownership in that situation for those companies. It was kind of a barrier to entry for novel, innovative startups and new entrants into the market. That was something that was administratively done to weaken our patent system in that 40- or 50-year period.
But in 1980, the Bayh-Dole Act, which we just talked about, the creation the Federal Circuit Court of Appeals as the exclusive court for patent and some other types of IP cases, and then appellate cases; then we got the Hatch-Waxman Act for balancing the entrance of generic drugs with the preservation and protection of the rights of exclusivity to innovators. So, you were balancing new entrants of new and improved products with the older ones that are going off patent that can [bring] competition of the generic variety.
That was understood to work for many years, and then some people forget the lessons of history even from laws in the mid 1980s. That's where it went until about 1990 which is what I call the US patenting 4.0 act. So, 1.0 is the 1790 [Patent] Act, 2.0 is the 1793 [Patent] Act, 3.0 is the 1836 Patent Act and then around 1990, when things really started to go off the rails, we kind of lost our appreciation for the goose that lays the golden egg of our patent system. It's gone downhill from there.
Giachino (26:41.0099 - 28:40.0290)
You write that for more than 30 years the United States has weakened its patent laws. Moving the needle demands that we reconnect the creative acts of invention with ownership of one's inventive works. I found incredibly enlightening your chapter “A Divide Between One's Creations and Secure Ownership” - the whole discussion of disorder in the court. I think it's really important for us that we understand the foundation and then we see how that has evolved and in some ways disintegrated over time, particularly through some of this case law.
Jim, as we wrap up our discussion today ... I want to point out two other chapters that I think are really critical for anybody interested in this issue and interested in IP protection. I found very interesting and enlightening your chapter on inventions at work as well as the chapter on inventors and common grace. Again, I think we get a better understanding of the common thread that you find among some of these famous inventors like Thomas Edison, James Ellison and others, as well as some of those key inventions that really stood out to you. You write about meeting the daughter of the founder of Gatorade and the impact that something like that has had both on a university system as well as on society in general. I found that to be very interesting and helpful in understanding how we got to where we are today, which takes us to your conclusion in “Reinventing by a Biblical Return”. Close us out with your thoughts on where we go from here.
Edwards (28:40.0619 - 32:18.0199)
As you mentioned, there are several court cases over the past 30 years that have weakened our patent system. In short, one is the weakening of access to injunctive relief for a valid and infringed patent. It wasn’t automatic, but it was understood to be, as in all forms of property, having access to stopping the stealer from continuing to get ill-gotten gains off of your creation. That's what is missing in patents right now for the years since 2006 and the eBay decision. That's the biggest one I'd say. And then there's the kangaroo court called the Patent Trial and Appeal Board, which exercises judicial powers in the administrative branch and is set up and biased in such a way as to cancel 84% of the patent claims that come before it. It’s a total travesty. The PTAB is what they call it. I really wish it could get repealed and just go back to normal, which worked for 200 years.
It always bugs me when people think they're smarter than the Founders, but that's an aside. Then there's the set of cases that really have made it troubling and problematic in figuring out what is eligible for a patent and what kind of subject matter is eligible for a patent. If you look at the language of the statute, Section 101 of the patent law, it's pretty plain what are the general categories. That's a threshold question. It's not a substantive question. Is this subject matter eligible or not? And it's like a process or a machine or something that's new or improved.
But courts have made a royal mess of that, and the way that they've done that is by injecting into the threshold question of eligibility things related to patentability. That is the substantive questions of [asking] is this novel. Is it new? It's not just the very same thing that's already been invented. Is it useful? Does it work? Does it solve the problem or address whatever it's trying to be a solution to? Is it non-obvious, which is a kind of technical term of art in the space? But suffice it to say it's just another substantive category for analysis of those new patents or the applications seeking a new patent. And what we need to do is go back and repeal all those bad court cases, those bad laws like the American Invents Act and restore the things that actually made us as successful as we were globally as an inventive leader for 200 years. That's the simple answer.
Giachino (32:18.0390 - 32:57.0885)
Well, not such a simple answer as we dive into all of this discussion, but certainly it has been very helpful to read your book, “To Invent Is Divine.” I think it takes us through the history of inventions, the importance and the history of our patent law system and it helped me certainly to better understand why IP protection does matter.
Our guest has been Jim Edwards. He's the author of “To Invent Is Divine: Creativity and Ownership”, a book that becomes available May 28th. You can pre-order a copy on Amazon. Jim, thank you again for your time today. We greatly appreciate it. We'd love to have you join us again.
Edwards (32:58.0045 - 32:59.0734)
Thank you, Renee. I look forward to it.
Giachino (32:59.0885 - 33:00.0734)
Have a wonderful day.
Edwards (33:00.0925 - 33:01.0540)
You too.