Peer-to-Patent: A System for Increasing Transparency

Open innovation. Crowdsourcing. You hear about these ideas a lot in the management literature and business press, but it's surprisingly hard to find examples of them in the wild.

Most of the companies putting these ideas in play so far have focused narrowly on transactional outreach to individuals. They post problems or challenges to the network, and people respond with ideas or answers. Without being too ungenerous, these approaches often resemble ramped-up suggestion boxes. Certainly there is power in suggestions and diverse ideas, but to paraphrase an old song, is that all there is?

We believe there are bigger possibilities. Some of them are now becoming visible in pilot efforts working to mobilize large numbers of motivated contributors and tap into their collective expertise and wisdom.

One of the more interesting of these is an effort conceived at New York Law School by Beth Noveck, a professor there and director of the Institute for Information Law & Policy. This effort, called Peer-to-Patent is run in cooperation with the U.S. Patent & Trademark Office (USPTO). Its target is a system that, if not broken, is certainly buckling under the strain of growing demand and limited resources — the global patent system.

Patent applications in the U.S. alone have doubled in the past 10 years. More than 1 million patent applications await scrutiny, and the backlog is growing. USPTO examiners have roughly 20 hours per patent application to determine whether the application should be granted a 20-year exclusive monopoly. On the other side of the patent application process, patent litigation is on the rise as more and more entities challenge the validity of patents already granted, often citing prior art that had not been considered as part of the original application process. Companies consume large sums in challenging and defending patents already issued.

Social Software

Something's got to give. Almost two years ago, the New York Law School began the "Peer-to-Patent Community Patent Review Pilot" in collaboration with the USPTO. This pilot initiative is a milestone since it represents the first significant effort to apply social software directly to the decision-making process of the federal government.

The idea behind the pilot was powerful. Why not provide some leverage to the USPTO patent examiners by mobilizing a broader group of interested parties to research and identify potential examples of prior art? In the context of patents, prior art refers to all information that has been made publicly available about an invention that could be relevant in assessing a patent applicant's claims of originality—it could be prior patents issued for inventions similar to the one under review, but it also includes published articles and public demonstrations. Overworked patent examiners are generally able to identify prior patents related to an application under review, but it is a much more challenging task to identify relevant articles or demonstrations.

The pilot program was sponsored by an impressive array of institutions ranging from the MacArthur Foundation and the Omidyar Network to a broad range of leading companies like General Electric (GE), Hewlett-Packard (HPQ), and IBM (IBM). It is particularly impressive that direct competitors joined together to sponsor this initiative despite their differences.

Many technology companies were motivated to submit their patent applications for broader public review in this pilot because of the promise that their applications would move to the front of the line in terms of review and decision by the patent examiners. Students at New York Law School were mobilized to help design the program, creating a powerful opportunity to integrate legal training with technology innovation and institutional innovation.

The program instituted a number of innovative approaches to support the public review process. Volunteers are invited to join the process. They could contribute prior art individually, but they are encouraged to join a team of other volunteers to take on the search for prior art on a specific patent application. These teams are provided with a shared online workspace where they could deliberate among themselves regarding a specific patent application's quality, decide on a research approach, suggest potential places to look for prior art and allocate research tasks.

Synthesized View

At the conclusion of the research effort, if more than 10 examples of prior art have surfaced, team participants have to determine the 10 most compelling examples of prior art before submitting their findings to the patent examiner. They do this often by thumbs up or thumbs down voting that yields a stack rank of all prior art submissions.

As a result, the patent examiner receives synthesized views of prior art rather than a much larger list of prior art candidates which might have further increased their workload. The patent examiner also benefits from the annotations provided by the peer reviewers on why the contributed prior art is important. This is a departure from previous rules where third parties contributing prior art were not permitted to provide any commentary with it. The research done by these online teams is not a replacement for the work the patent examiner must do, but it significantly augments the scope of the work, providing even more information to consider as part of the review process.

The program also creatively uses tagging by participants as a way to make it easier to find patents that might be relevant to their area of expertise. The patent applications themselves often use obscure categories that make it very hard to discover relevant patents. The designers of the Web site have employed engaging visualization techniques to orient and integrate new participants into the review process.

After a promising first year, the USPTO decided to continue the pilot for a second year. Since its launch, the effort has attracted more than 2,500 registered participants. Teams bringing together participants from 152 countries submitted nearly 350 items of prior art on 121 applications. Almost three-quarters of the patent examiners involved in the pilot process indicated they would like to see Peer-to-Patent implemented as a regular office practice.

The Peer to Patent process was especially useful in surfacing nonpatent prior art. While only 14% of the prior art references submitted by the inventors themselves covered non-patent literature, 55% of the prior art references submitted by Peer-to-Patent reviewers were for non-patent literature. Of the first 57 office actions issued by the USPTO during the pilot process, 16 rejections showed use of Peer-to-Patent submitted prior art.

These early results are very promising, and they reflect some deep thinking regarding the challenges of mobilizing and focusing contributions from distributed participants. Beth Noveck observes that "these efforts cannot succeed without significant institutional innovation based on a deep understanding of the information required to support more effective decision making and the arrangements that can be most effective in improving decision making across diverse and independent constituencies."

So, why do many leading corporations support an initiative that appears designed to surface more information to challenge patent applications? In short, Peer-to-Patent offers the potential to deliver stronger, more litigation-proof patents in shorter time and lower cost. By increasing transparency at the outset and surfacing potential issues regarding prior art earlier, this process can preempt very costly litigation down the road. In an important way, Peer-to-Patent becomes a powerful insurance program to mitigate risk of patent challenges.

The early success of this pilot program has led to efforts to engage patent agencies around the implementation of similar initiatives in Canada, Japan, and Western Europe. Noveck anticipates further benefits from the ability to "create a global innovation network uniting patent offices around the world."

Lessons for Business Executives

Beyond its relevance to strengthening the patent application process, the Peer-to-Patent pilot offers some broader lessons regarding efforts to harness open innovation and crowdsourcing.

Move beyond individuals to harness the power of teams.Diverse experiences and perspectives are powerful drivers of creativity, but this potential can be further amplified when diverse participants must collaborate around shared goals.

Move beyond short-term transactions to build more sustaining relationships.By requiring the formation of teams, this initiative encourages the development of relationships that help to more effectively focus efforts and tap into the diversity of the individuals involved.

Define action points that require negotiation.Much of the value of this initiative for the patent examiners comes from the requirement that teams reach agreement regarding a short list of prior art. It avoids the risk of an avalanche of input with widely varying quality.

Pay attention to institutional innovation.Many executives have the mistaken impression that these initiatives are completely self-organizing and emergent. Instead, this pilot and other successful initiatives like it reveal that considerable institutional innovation is required to redefine relationships, roles and decision-making processes across independent entities.

Do not overdefine the collaboration space.While the designers of this initiative defined the broad relationships, roles and decision-making process required to make this successful, they left considerable room for individual teams to define how they wanted to work together.

Invest to attract and integrate new participants.These initiatives often succeed or fail based on the degree to which they can create visibility for potential participants to become aware of the opportunities to contribute. Also, this pilot illustrates the power of investing in visualization tools and other mechanisms to rapidly integrate new participants into the discovery process.

Findability is key. When bringing diverse participants together in broad collaboration efforts, helping participants to connect with each other and to connect with relevant material is a key challenge. As the tagging efforts in Peer-to-Patent illustrate, the participants themselves can be very helpful in these efforts, but they need the tools to encourage and support their contributions.

Before it's here, it's on the Bloomberg Terminal.