The shouting's evidently far from over on this, but it's going to shake up a lot of things, and spell the deathknell for a lot of patents that should arguably never have been granted in the first place. Hopefully it will also extend to some of the more stupid "business methods" patents.
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Now, patenting a specific gene-based treatment that you have developed ... sure, I don't have a problem with that. But you shouldn't get to patent the underlying genes — or even medical use of the underlying genes — just your specific treatment and method. And if someone else subsequently comes up with a different method for treating the same problem based on the same gene, that's fine, they get to patent theirs too. Patenting genomes (or parts thereof) because they might have possible future medical utility is as absurd as patenting Silicon Valley because somebody who lives there might have a valuable idea some day. It's not about innovation or protecting investment, it's gene-squatting.
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A more balanced expectation would be to follow Federal Circuit and Supreme Court precedents to modestly scale back some of the vague, broad and obvious patent claims. His report does NOT represent the position of the USPTO as it claims to, but distorts it by stretching to an extreme that was never intended.
Lawyers study the use of words. This guy uses words very cleverly, presenting a doom and gloom scenario of no patents on software or business methods in order to show the world how bad it would be if we got rid of them. Like you, I think they should be tossed altogether, but this is not the announcement (or decision) we have been looking for, move along.