"Open innovation's answer to the challenges of patent overpropertization" is an article by W. Wesley Hill, who has recently completed an LLM in Information Technology and Intellectual Property at the University of East Anglia. This article is now available online, to e-subscribers of Oxford University Press's Journal of Intellectual Property Law & Practice
(the print version will be published in due course; JIPLP's website is here
). According to the abstract:
In 2003, Henry Chesbrough introduced the concept of open innovation to the study of research and development (R&D). Open innovation teaches that technology advancement is best fostered through inbound and outbound R&D investment and the exchange of innovative knowledge. Patents, often the subject of technology transfer, are characterized as a bargain between the inventor and the State. Without propertization through the patent bargain, it is argued, market failure occurs.
Despite their close ties, the relationship between open innovation strategies and the patent bargain is best described as both friendly and adversarial at the same time. Propertization of innovative knowledge through the patent bargain has, paradoxically, had the effect of blocking future innovation. Due to overpropertization, patent trolls and patent thickets have arisen that threaten to stifle advancement in new technologies.
This article discusses open innovation strategies that offer answers to the challenges of overpropertization. Where rent-seeking behaviours threaten future technologies, defensive pooling manages risk; where innovation-blocking thickets arise, private sharing regimes cross-license patents; and where innovative knowledge is best protected as confidential information, trusted intermediaries can facilitate exchange. In each case, open innovation is at work.
If any readers of this blog happen also to get hold of this article, it will be good to know what they think, particularly with regard to the author's conclusion:
Open innovation emphasizes the character of the IPR as a tradable good, rather than a mere exclusionary right. As Chesbrough documents in his open innovation theory, a shift toward openness in inflows and outflows of knowledge is occurring. Perhaps the closed innovation paradigm has given way to market behaviours that are best viewed through the lens of open innovation: where rent-seeking behaviours threaten future technologies, defensive pooling manages risk; where innovation-blocking thickets arise, private sharing regimes cross-license patents; and where innovative knowledge is best protected as confidential information, trusted intermediaries can facilitate exchange. In each case, open innovation is at work, enabling technology transfer and responding to the challenges of overpropertization.
I think a lot of the time a company does not know what it knows until it files a patent application on it. Then someone takes the trouble to write it down properly defining the boundaries and clever bits. Then that becomes sellable, licensable, tradeable, talkabout-able in negotiations with others. Open innovation opens up a lot of new ways of working with other organisations and I would agree with the author that IPR's are tradeable goods within it.
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