Nest Labs founder and CEO Tony Fadell has warned startups that patent law has become a tool of market incumbents to stifle competition, according to CNet. In addition to other dirty tricks such as lousy product write-ups on review sites, companies will use lawsuits to prevent startups from gaining traction in the market, either by suppressing products or by simply increasing business costs through legal fees. Fadell suggests that a startup must prepare for legal battles, not just marketing challenges, in offering new products. This perspective provides an ironic twist on the banal defense of patents as a means to promote innovation.
To make matters worse for inventors and other visionaries, a new, secret trade treaty under negotiation will likely increase legal barriers to startups. According to Network World, the Trans-Pacific Partnership Agreement between 12 nations including the U.S. will “increase the term of patents and copyright, reduce requirements for patentability and increase damages for infringements of patents and copyrights,” judging from a draft version released by WikiLeaks. The agreement may be an end run around the standard legislative process, as critics have compared portions of the agreement to the SOPA and PIPA bills that failed in Congress. Should the agreement be ratified, the challenges that patent law pose against startups will expand.
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