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Research Staying Informed on Patent Reform In research conducted for the National Academies of Science, two profes- sors hope to provide information that will aid in U.S. patent law reform. Stuart Graham, assistant professor of strategic management at the Georgia Institute of Tech- nology's College of Management in Atlanta, Georgia, and Dietmar Harhoff, professor of management at the University of Munich, Ger- many, closely compared U.S. and European patent systems. Their research has become especially important now that U.S. policy makers have passed the Patent Reform Act in 2005, which calls for the U.S. to adopt features of the European patent system. In their paper, "Can Post-Grant Reviews Improve Patent System Design?," the researchers explain their "twin study" that compared U.S. patents, both litigated and nonlitigated, to equivalent patents granted in Europe. In the U.S., Graham explains, patents are granted on a "first-to- invent" basis. Even if someone holds a patent on an invention, that patent can be challenged or revoked if another person can prove he or she invented it first. Such challenges often involve complex and expensive litigation— such lawsuits cost $4 mil- lion, on average. In Europe, however, patents are granted on a "first-to-file" basis. Under this system, the first to obtain a patent for an innovation owns that patent, even if it is later 52 manufacture, and stifle innovation," says Graham. "Under a less expen- sive system, many of these unused patents would be eliminated." Graham says that the next step in this research is to study how firms are using the international patent system to protect their innovations. "Policy makers should have accurate information when making policy decisions," Graham says. "Advo- cates on both sides of the issue need better information so that they can help the system." Redefining 'Elite' found that someone else invented it. To oppose a patent, petitioners ask for a post-grant review through the patent office, a process that costs much less than U.S. litigation— about €15,000 (or US$19,000) on average. Not surprisingly, researchers found that Europe's post-grant review process would drastically reduce the cost of patent challenges if adopted in the U.S. In addition, in their twin study of international sister patents, Graham and Harhoff found that six percent of patents that weren't challenged in the U.S. were chal- lenged in Europe. Many of those patents were eventually deemed inval- id and revoked. "Under the current Stuart Graham BizEd NOVEMBER/DECEMBER 2006 U.S. system, many pat- ents are being used sole- ly to demand royalties from companies, hold up The emergence of the Internet has had a profound impact on industries from marketing to shipping, but its influence is also being felt in unexpected places—including elite, research-oriented institutions of higher education. Technological advances have drastically simplified communication across long distances, making it easy for faculty who are conducting research to work with colleagues across the country or around the globe. Because collaboration is no lon- ger dependent on co-location, elite universities might be losing the edge when it comes to research, believes E. Han Kim, a profes- sor of finance at the University of Michigan's Ross School of Business in Ann Arbor. Working with col- laborators Adair Morse of the Ross School and Luigi Zingales of the University of Chicago, Kim studied the research productivity of eco- nomics and finance faculty at 25 top U.S. schools from 1970 to 2001. They found that, while individual universities may be losing ground in the research race, academic research as a whole has received a boost as a ED HONOWITZ/GETTY IMAGES