The History of Patent Wars
With technology companies such as Apple and Samsung currently engaged in high-profile disputes over patents, it’s easy to think that patent wars are solely a modern phenomenon.
However, while the “smartphone wars”, as they’re now known, are certainly some of the most costly patent wars in history, they’re far from the only examples of leading companies battling each other over the rights to technology.
When compared to some of history’s patent wars, today’s struggles over technology are, by contrast, fairly mild. While the technology in question is more advanced and the sums far greater, the legal aspects of today’s cases share a lot in common with those of the 19th and 20th century.
As the vast majority of patent litigation occurs in the United States, it’s a great place to begin our look at patent wars. In 1790, the introduction of patent laws occurred in the United States. Despite this, it wasn’t until the industrial revolution that patent disputes began to occur in any meaningful quantity.
One of the first technological innovations to be protected against competitors was the sewing machine. In 1846, Elias Hunt had patented his version of the invention, but rival Isaac Singer was also pursuing a claim as early as 1850. As with many of today’s patent disputes, the patent war between Hunt and Singer revolved around overlapping patents covering products that were remarkably similar.
Litigation was high profile, particularly within legal circles, and cases were costly for both parties. Much like today, companies commercially exploited their patents in the form of patent selling and trading, as well as partnerships between companies that licensed patents and those that manufactured the products.
As with many of today’s patent disputes, the fight over the rights to the technology used in the sewing machine was not resolved quickly. An agreement was reached between all of the patent owners in which the technology would belong to a patent pool known as “the Sewing Machine Combination.”
Many of the 19th century’s other technological developments ended up in a form of patent warfare deadlock, including the telephone, the airplane, and barbed wire. In the case of the telephone, which was patented in 1876, there were only five hours between the filing of patents by Alexander Bell and Elisha Gray’s companies.
In the two years the followed, the rival companies engaged in over five hundred separate lawsuits – a litigation battle that, in many ways, mirrors those of today’s top smartphone manufacturers.
Many critics of today’s patent laws take aim at what they perceive as an “explosion in patent litigation”. They may be surprised to learn that the patent litigation rate of today is just 1.5%, compared to an astounding 3.6% litigation rate for the decade beginning in 1840.
During the 20th century, the patent disputes over technology that had defined the previous 100 years turned into disputes over pharmaceutical licensing. While the subject was different, the disputes were much the same – a marrying of technology and science.
What’s interesting about these cases, and those of today, is the cost. Companies such as Apple and Google have spent an estimated $20 billion fighting patent lawsuits – a sum that, by all measures, exceeds the amount that they spend on the research and development of new technologies.
This article was written by our friends over at Vannin Capital. Find out more about them at litigationfunding.com.