Now, that you understand a little bit of what a patent is, lets ask what does a patent do? What does it protect? Well, utility patents and this is specifically what we're talking about through the rest of this module, protect function. Not expression, expression is the way you say something or do something or the way it appears. Function is how it works. So utility patent does not protect the appearance of your iPhone. It protects the way that it connects to WiFi. It protects the way the battery charges. It protects the way that you swipe your finger across the screen and the computer or processor in the phone reacts. So the particular functions of the phone, not the appearance of the phone. The design patent that protects expression, not function. But most patents are utility patents. So of the patents on an iPhone, there are more than 2,000 patents in an iPhone. There are only a couple of design patterns. There are many, many, many, many utility patents within the phone that protect many things the phone does and the way that it does it. Examples of functions can include both products like a chip or an artifact, or a switch and a process. The way of moving your finger across the screen and try to slide that into characters, and the processor or the way of setting up a business. So both products, physical things and processes ways of doing things can both be protected. Now in terms of products, many functions within a product are protected. Usually, utility patents are not issued on the product itself. They're issued on sub-elements or sub-aspects of that product. So Intel does not patent its processor chips. Intel gets patents on things within the chips. So the Intel microprocessor has a patent on the way that the chip multiplies two large numbers together using complex mathematics to do it faster. Because of that patent on the way they multiply, they're a little bit faster than an AMD chip at doing that task which means they're better at some graphics and some analysis and statistics. Because they're better at that part of the chip design. The chip itself is too big to patent, it's too many things. You push patents down to a smaller level and patent more detailed functions. Another example of patents is the patenting of a synthetic diamond, but you can't actually patent the diamond. The only thing you can patent is the process of making a diamond, so you can get a patent on your process for making a synthetic diamond. You cannot patent a diamond, because a diamond exists in nature. A diamond is a physical artifact that you didn't create. You created this diamond specifically, but you can only patent a process of creating a diamond not the diamond itself. Because diamonds preexisted your invention. You're simply making something in a new way. So that's a process patent. And the problem with process patents is somebody else can find a new process, a new way of doing something. And can come back and patent that new process and say, we've got a different way of making synthetic diamonds. That's okay. As long as you're not violating my process, you have a different patent. An example of a process patent that was at first denied, but later approved by the supreme court was a patent on a process for organizing and structuring financial services information systems back off it's activities. The data processing system for Hub and Spoke financial services configuration was a patent issue by the US government on IT for business process. So you can see how far away a patent can go from a product, there's no product here. This is IT to support a way of structuring a financial services firm and it was issued a patent. So patents can be on processes including businesses processes. Now, one of the issues fundamental to patent law is you cannot patent an idea. But you can only patent a function. Now the problem is that a narrowly defined function gets really close to an idea or concept. So we can't patent an idea or concept, but an implementation of an idea can be patented as a product or device or process using that innovative. So Intel multiplying two numbers together fast is using a mathematical concept or idea that's not patentable, but the way Intel does it is patentable. This is complicated and it's tricky and it ended up with millions of dollars in legal fees being paid to take this battle up from court, to court, to court to try to fight over this issue. Because it's hard to tell. It's hard to know when the parties on both sides were fighting. If you can't figure it out, that's okay. A lot of judges couldn't figure it out either. And eventually, the supreme court ruled. So we know the answer, but it was an expensive process to discover the answer on and not everyone even agrees that that is the correct answer. Sometimes this can be tricky when you talk about discovery versus creation, because we know we can't patent things which are discovered. If it exists in nature, you can't patent it like a diamond. But Merck got a patent on vitamin B12, which exists in nature. And you would say, wait, a minute. You told me you can't patent something you discovered, but Merck did. Well, how'd they do that? Well, originally, the patent office said, no, you can't patent this. We reject it. The government said, no. The supreme court said, yes, you can. Yes, you can get a patent on B12. Government was wrong to reject this and the reason is that what Merck had done with vitamin B12 is take something that existed in cow liver in a diffuse or diluted state and concentrate it, and make it in a composition that had never before existed in nature. And because of that, vitamin B12 was able to be a patented medicine. Now if you know what vitamin B12 is or maybe you take it, you probably know there are many makers of B12. You might say, wow, you told me Merck had a patent on it. That's a monopoly, how come there's so many B12s on the market? Merck got this patent over 20 years ago, only got a 20-year life. Now, it's public domain. Everybody can make vitamin B12. But for 20 years, Merck owned that vitamin. That was it. Merck was the one who made that. You can take the Merck vitamin which is a tiny little pill or you can go eat two pounds of cow liver, your choice. A kilogram of cow liver or a tiny little pill. Kilogram of liver, tiny little pill, kilogram. I think I'll take the tiny little pill. I mean, even if I like liver which I happen to like it. But that's a lot of liver. I'll take the little pill. So what can be protected? Functions. Process or products can be protected. Ideas or concepts, no. No ideas, no concepts. Discovery, no. Creation, yes. So you can protect what you create. You can protect it if it's a process or product function, but not when it's an idea or concept. Thank you. [MUSIC]
