By Nathaniel Ari Long

Patent laws promote innovation by protecting new technology. Because new technology is new, it inevitably presents new problems that must be addressed by new legal developments.

This idea can explain changes in the law to accommodate the increasingly distributed nature of today’s technology. One example of this is the recent fight between Canadian-based Research In Motion (RIM), maker of the pervasive Blackberry device that allows people to check e-mail while away from the office, and NTP, a United States company that owns patents alleged to cover the Blackberry technology. See, e.g., NTP, Inc. v. Research in Motion, Ltd., 418 F.3d 1282 (Fed. Cir. 2005), for one piece of the much larger battle between RIM and NTP.

While the Blackberry fits in your pocket, it is only one small piece of a much bigger distributed system. That system includes computers and wireless networks all around the world. To direct e-mails to a Blackberry in the United States, RIM uses its servers in Canada, which are connected to wireless networks across the United States.

Traditionally, U.S. patent law was considered territorial -- it did not allow patents to be enforced unless the invention was physically inside the United States. But what happens when the invention is so big that a piece of it is in another country? RIM’s new technology forced a court to address this issue, and in the decision cited above the court held that the Blackberry could infringe a U.S. patent even though part of the Blackberry is actually in Canada.

Incidentally, it appears the battle between RIM and NTP may finally be over. On March 3, the parties entered a settlement agreement in which NTP relinquished all claims for a cash payment of $612 million.

Another example of changing patent laws appears to reflect, not changing technology, but a change in innovation itself. That is, the law is increasingly recognizing a change in the ways innovators are collaborating to invent new technologies. Like the widely distributed technology at issue in the RIM case, it appears innovation itself is more widely distributed, and the law is evolving to help innovators obtain patent rights despite their increasing distribution.

This change is occurring in the way we determine when an invention is “obvious” in patent law. If an invention is obvious, the inventor is not entitled to a patent. But how do you decide if something is obvious? Under the patent statute, you conduct obviousness analysis by looking at what other people did before. If there’s not sufficient difference between an invention and what others did before, then no patent.

Which “other people” does the law look at to decide if an invention is obvious? Until 1984, it was any other people -- anyone besides the inventor himself or, if there were co-inventors, anyone besides the co-inventors.

This reflected the notion, which may have been true for many years, that inventors work alone or in small groups and build a freestanding, complete invention -- a brainchild complete with head, heart, lungs and legs. Innovation was considered to be concentrated in the mind of a single individual or small group.

In 1984, Congress amended the statute that governs obviousness, 35 U.S.C. ¤ 103. It added section (c) that says certain subject matter, even though developed by “other people,” won’t be considered in the obviousness analysis when that subject matter and an invention are owned by a single organization. This change reflected the reality of the way many innovators actually work -- as part of large organizations in which people work in teams, share ideas and make small incremental advances over the work of others.

Thus, Congress recognized that innovation was occurring in a more distributed way -- different teams within an organization were responsible for the various pieces of the brainchild. By removing the work of others in the same organization from obviousness analysis, Congress allowed innovators to obtain patent rights despite the distributed nature of their innovation.

Congress amended the obviousness statute again with the Cooperative Research and Technology Enhancement (CREATE) Act of 2004. This time, it expanded the 1984 amendment to recognize that today’s innovation is distributed beyond the boundaries of single organizations. Under the current statute, where there is a joint research agreement between two organizations, subject matter developed under the agreement can be removed from the obviousness analysis, even though the subject matter is developed by other people in another organization.

Perhaps this change in the way we innovate reflects increasing complexity of technology. Much of today’s technology is not fully understood by any single individual and, perhaps increasingly, it is not even understood by people within any single organization. Another possible explanation for the change is that technology, such as the Blackberry, is allowing faster, wider collaboration, causing a social change in the way we communicate and innovate.

Looking forward, we can expect patent laws to reflect continuing erosion in the relevance of national boundaries and perhaps even erosion of organizational boundaries. We can also expect further creative advances in the legal framework used to promote innovation, as innovation itself continues to change.