Introducing the Defensive Patent License

Two professors from the University of California, Berkeley School of Law have launched the Defensive Patent License (DPL), a legal tool that is designed to do for patents what the GPL did for software licenses. It creates a copyleft-style method for patent holders to automatically share their patents with others who agree to share theirs in return. The goal is to "de-weaponize" patents and thus reduce the gridlock that slows down technology sector innovation, but the DPL is likely to have an uphill battle.

The DPL's creators are Jason Schultz and Jennifer Urban, both of whom have a background in online legal activism — Schultz with the Electronic Frontier Foundation's (EFF) Patent Busting project, and Urban with ChillingEffects. We first covered the effort in 2010, and the duo have been developing the specifics of the license since (a thorough examination can be found in the May 2011 video lecture they link to from the project site). But the DPL itself is now in a "public beta" phase, with feedback solicited from the Internet at large. The current text is available as a PDF, a Google Docs document, and as Markdown-formatted text on Github. There is also a paper available describing the rationale for the DPL's specific terms.

The best offense is a good defense

The idea at the heart of the DPL is defensive patents — those that a company files or purchases solely to deter its competitors from bringing lawsuits against it. Defensive patents are not offered for licensing under revenue-generating commercial terms, nor are they used to initiate litigation against others. The result is that large companies amass giant patent portfolios and enjoy the same relative stability of the Cold War's mutually-assured destruction. An unfortunate side effect of this popular strategy is patent proliferation. That tends to make open source projects and small companies live in fear of being shut down by astronomically expensive infringement lawsuits because they cannot stockpile their own defensive patents.

The DPL is a tool the companies could use to disarm the defensive patent standoff. Under its terms, a participating company offers a non-exclusive, royalty-free, perpetual, world-wide license for all of the patents in its patent portfolio to every other patent holder that also participates in the DPL. The DPL's license can be revoked for a particular licensee only under two circumstances: if the licensee sues another DPL licensor for patent infringement offensively, or if the licensee withdraws its patent portfolio from the DPL. However, the revocation is not automatic; each DPL licensor has the option to revoke a licensee. The result is that the DPL creates a mutually cross-licensing network, whose members have full access to each others' patents. Consequently, they should have no reason to pursue infringement litigation against each other, and defensive patents (both current and future) are devalued.

Outside of the DPL family, however, licensors are permitted to license any patents in their portfolios to any party, and to litigate to their heart's content. In theory that allows them to continue making money from their patents, and to respond to patent threats from outsiders. Two additional terms are important. First, a licensor may withdraw its portfolio from the DPL, but it must give advance notice before doing so (six months in the current wording), and all existing DPL licenses will remain intact. Second, the DPL stipulates that a licensor must ensure that its patents continue to be DPLed even if they are sold or acquired (by making that condition a term of the sale or transfer).

The latter condition is an attempt to prevent players from "gaming" the system by gaining access of the DPL patent pool then selling themselves, and it is believed to ensure the DPL's persistence after a bankruptcy declaration (although the authors solicit feedback on these points, since preventing such gaming is vital to making the DPL work).

Under idyllic circumstances, then, all DPL participants have free and perpetual access to each others' patents, but can still do whatever they want against players outside of the DPL community. That provides incentive for new parties to join, and no member has the power to refuse membership in the community to another licensor. The requirement that a licensor must place its entire patent portfolio under the DPL is there to keep unscrupulous companies from donating junk patents while keeping valuable ones private, which would prevent the pool from becoming valuable in the first place.

Is it that simple?

In their talk, Schultz and Urban enumerated several concerns about the DPL raised in their conversations with outsiders. One is that access to the pool of DPL patents is not sufficient incentive to join. Another is that the full-portfolio requirement is too off-putting and that a smaller commitment ought to be required. There are also potential anti-trust issues in some jurisdictions, the possibility of loopholes not yet discovered, and the general criticism that the DPL simply adds another entanglement to the already hard-to-navigate thicket of patent problems.

They also admit that many of the technology sector's problematic patents are not defensive, so the DPL will not end all patent litigation. In particular, patent trolls would be essentially unaffected by the existence of even a large DPL. Trolls litigate with offensive patents, and they do so without fear of retaliation because they make no products or services of their own (i.e., you cannot counter-sue a patent troll for infringing on your own portfolio, because the troll has no products; the mutually-assured-destruction strategy does not work against them, DPL or not).

Since the DPL's public launch, there have been several responses that offered additional concerns. David Hayes and Eric Schulman argue that joining the DPL disproportionately favors small players with fewer patents (who thus get access to more patents than they contribute back). Stephan Kinsella notes that small players do not get much for free because you can only join the DPL community if you have patents, and patents remain expensive to get and to retain. Kinsella also observes that it may be difficult to get the DPL pool started given the unpredictability of the US federal government.

Given the state of mutually-assured destruction, it is inherently risky to be the first one to lay down one's weapon, but that concern may be overstated by DPL critics. After all, for the first patent-holder to join the pool, nothing changes: the company looks benevolent, but still has free reign to litigate non-members (i.e., everyone) at will. Still, the "all-in" portfolio requirement has another problem: it is only appealing to companies whose entire portfolio is comprised of defensive patents, and leaves no room for other kinds of patents. It does not take too much speculation to see that there are companies working in both software and hardware (e.g., Intel or IBM) with hardware-related patents that even the staunchest software-patent critic might concede are valid original inventions.

For open source software projects, though, the primary concern is likely to be Kinsella's point about requiring patents to buy a seat at the table. Schultz and Urban concede that open source projects typically do not file for patents — for many reasons, including cultural opposition and mistrust of the patent system. But the high cost of acquiring a patent is not something the DPL can change.

There have been other approaches to fixing the patent problem from open source projects' perspective, including the Open Invention Network and Twitter's recent Innovator's Patent Agreement. On June 19, the EFF launched its own patent reform campaign with a seven-fold list of fixes. Compared to the other efforts, the DPL is not so much an attempt to fix the patent system as it is a way for interested patent holders to remove themselves from the defensive-patent game.

That option certainly won't appeal to everyone — and certainly won't to patent trolls or others who profit directly from gaming the system — but then again, the GPL permits developers to escape from the typical software licensing hijinks, and it has proven remarkably successful, as has the Creative Commons license suite for authors and artists. Not every such attempt to craft a standardized license is a success; Canonical's Project Harmony attempted to draft a standardized set of contributor agreements, but so far does not seem to have caught on in widespread fashion. The DPL project says it is open to public feedback, however, so if there is a consensus to be reached on anything resembling a "GPL for patents," this is probably how we will find it.