The U.S. patent system has been labeled broken for many years, but folks are still rushing to file. The U.S. Patent and Trademark office received 212,377 patent applications in 1995 compared with more than 440,000 in 2006. So broken or not, people are still trying to play in the system. However, Washington has tried for the last five years to reform the nation's patent laws to make sure patents granted fairly protect the research that went into them without being overly broad and stifling innovation across the board. For a quick take on some of the proposed reforms, check out this article in Corporate Dealmaker.

Inevitably, there's disagreement over what, if any, reforms are actually needed. Venture firms and tech incumbents in particular are finding much to disagree about, according to this article. One controversial proposal is adoption of a process of "post-grant opposition." which means companies and people could challenge patents after they've been granted without going to court. Big companies tend to like the idea, but the National Venture Capital Association argues that such a process would put too much uncertainty into the system and be a disadvantage to smaller firms.

For all their frustration with the existing system — and despite the publicity given to a few so-called trolls — the larger incumbents are clearly the ones benefiting under today's patent laws. According to Paul Ryan, chairman of patent licensing firm (or troll depending on your point of view) Acacia Research Corp., 60% of patented technology comes from small companies, inventors, universities and research labs, but they receive less than 1% of patent licensing revenue; bigger firms, he says, hold 40% of the patents but get more than 99% of the licensing revenue. The fear among some smaller patent holders is that "reform" could turn out to be a plan to help larger firms get 100% of the licensing revenue. — Stacey Higginbotham

Join Corporate Dealmaker's LinkedIn forum