Special Report June 22, 2009, 10:56AM EST

A Scholar-Activist Challenges U.S. Patent Law

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SPECIAL REPORT

Voices of Innovation

John F Duffy is a professor at the George Washington University Law School. He is looking to change the U.S. patent system through litigation

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a former law clerk for Justice Scalia

Duffy may yet get his way. Last spring, in a case known as Bilski, the Federal Circuit hand-picked Duffy to argue for broadly patenting business methods. The court rejected his argument in an October ruling that significantly pared back what can be patented. Now that the case is headed to the Supreme Court, Duffy says he expects to make another amicus—or friend of the court— filing.

A one-time speedy long-distance runner—he was on Harvard's cross-country team and has run a near-Olympic-qualifying 2:24 marathon—Duffy has been hobbled recently by bad knees. But he still races around to present his ideas at conferences, from Atlanta to Buenos Aries.

At one of those talks in 2003, in Amelia Island, Fla., he told his audience he thought the question of when an invention was too obvious to get a patent was ripe for revisiting by the Supreme Court. Duffy, who had been a law clerk for Justice Antonin Scalia from 1992 to 1993, thought patent examiners and lower courts had gotten too lax about this requirement and were granting droves of patents for things that weren't true breakthroughs.

In 2005, Duffy got an e-mail from attorney James W. Dabney, who had attended the presentation. An appeals court had just found Dabney's client, Canadian auto parts maker KSR International, liable for infringing a patent on a gas pedal that could be adjusted to accommodate drivers of different heights. After reviewing the patent and poring over the case files, Duffy signed on with Dabney to take the case to the Supreme Court. Dabney is a partner at Fried, Frank, Shriver, Harris & Jacobson, a New York law firm with which Duffy is now affiliated.

Challenging damage computations, too

In a unanimous decision in 2007, the court sided with KSR, tossing out the gas-pedal patent because it was obvious. More significantly, the ruling raised the bar on what it takes to get a patent. "Obviousness is really the heart of patenting, and the holding from that decision is now cited in almost every patent litigation, and in every patent application rejection written by an examiner," says Dennis Crouch, a professor at the University of Missouri School of Law.

Duffy has signed an amicus brief in another case that could upset the status quo. In this case, Microsoft is trying to persuade the Federal Circuit to overturn a $500 million infringement award to Alcatel-Lucent (ALU). Siding with Microsoft—and filed on behalf of a group of clients including Intel, Yahoo, Palm (PALM), and SAP (SAP)—the brief calls for a change in the way patent damages are computed.

Tech companies in particular are upset that juries sometimes calculate awards based on the entire value of a product—Microsoft's Outlook e-mail program, in this lawsuit—and not the value of what is often a tiny infringing component, such as the feature that allows users to create an appointment in Outlook's calendar function. The appellate judges heard arguments in the case on June 2.

once a card-counting blackjack player

Duffy's career path wasn't a straight shot. A physics major at Harvard, he spent his first year out of college in New Jersey, researching optical computing at the famed Bell Labs (now owned by Alcatel-Lucent) before heading to law school at the University of Chicago in 1986. "If you're curious about the laws of nature, you can also be curious about the laws of mankind," Duffy says, explaining his decision. "It's a much bigger puzzle in some ways."

Even outside the courtroom, the boyishly clean-cut and wonkish academic can be disruptive. He drew the ire of casino managers as a card-counting blackjack player in college. Last year, his publication of a paper concluding that dozens of administrative judges in the Patent Office had been unconstitutionally appointed sent Congress scrambling to fix the flaw, forcing the judges to be reappointed retroactively under revised procedures.

Having spent a good deal of time examining the historical evolution of U.S. patent law, Duffy has this to say: "If you dig deep enough, you sometimes find there is an academic at the bottom of the change—sometimes to their credit, sometimes not so."

Orey covers corporations for BusinessWeek.