Nothing new under the sun

The Malone family loves water balloon fights.

Josh and Alison Malone have eight kids, so the fights can be epic. The only downside: preparing the balloons for battle. Back in 2006, Josh followed the universal method of placing a single deflated balloon on a faucet, filling it with water, and tying it off with a knot. Balloon count: one. He repeated the steps. Balloon count: two. The tedious process drove him nuts. By the time he had a tubful of balloons, his kids had long bailed. “I just knew there had to be a solution,” Malone said. “My job was to find it.”

That year, Malone quit his corporate job as a process engineer to launch a business as an entrepreneur and independent inventor. He named his company Tinnus Enterprises, an acronym for “There is nothing new under the sun.” Malone says that’s the paradox of his work: Inventors don’t make things ex nihilo. “God knows all the answers. He made all the pieces.” The inventor simply finds things and puts them together, Malone says.

But that creative assembly is the stuff upon which nations are built. From its beginning, the United States encouraged people from all walks of life to be creative and pursue their inventions. It built a patent system that offered an inventor the exclusive right to make and sell a product (for a limited amount of time) in exchange for disclosing the invention to the public. That resulted in technologies that range from the lightbulb and the Wright brothers’ “Flying Machine” to a contraption that slices bread and many other products people might consider the best things since.

For seven years, Malone tinkered with about a dozen ideas, and even invented a few other things, like the Slice Cordless Design Cutter, a scrapbooking tool, and Shapelets, bands that stretch into different shapes. But he spent much of his time trying to find a better way to fill and tie water balloons. He knew a fast, easy solution would transform kids’ birthday parties, celebrations, and summer events—and eliminate a frustrating and time-consuming process. His big obstacle: how to seal off the neck of the balloon once filled with water.

He tried twisting and segmenting the neck like a ­sausage. Nope. He tried plugging the neck with something that wouldn’t hurt when it hit another person, like mini marshmallows. Not quite right either.

By 2014, he had eaten through his savings. The kids had no college funds and needed orthodontic work. And Alison had come down with a debilitating illness that left her partially paralyzed. (She later recovered.) They both knew the time had come for Josh to pack up his toys and go back to a corporate job. But he asked Alison to give him a few more weeks. He had one final idea to tie up the loose ends of his balloon project—literally. She agreed.

IN THE ORIGINAL U.S. CONSTITUTION, the word right appears only once, in the intellectual property clause. Article 1, Section 8, grants Congress the power “to promote the progress of science and useful arts by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.” Three years after the Constitution took effect, Congress used its power to pass the Patent Act of 1790 and offered inventors a patent for novel products.

America’s approach contrasted with the law in England, where favoritism ruled. In England, if aristocrats or wealthy men did good work for the Crown, they got a monopoly (called a patent) as a royal favor. America, on the other hand, took a merit-based approach. Ordinary people—farmers, housewives, teachers—could come up with something new and own the right to it for a limited time.

Malone says that approach helped the vulnerable, fledgling country become a world superpower. Inventors like Thomas Edison and Alexander Graham Bell created things that contributed to the country’s economic wealth, freedom, and prosperity. But Malone says the modern-­day patent system has shifted the power from the rights of individual inventors to corporations. Not only has that taken away the value of owning a patent, it’s resulted in less innovation and a languishing economy. Now, China grants more new patents each year than the United States.

But Malone didn’t know that yet.

In those final few weeks before going back to corporate life, Malone had his long-awaited “aha” moment. He used slender tubes to fill the balloons with water. When the balloons were full and the tubes slid out, a small O-ring cinched the neck of each balloon shut.

“It worked almost perfectly the first time,” Malone said. When he was done tweaking it, he had an invention that could fill 100 water balloons in one minute. The product reminded him of a bunch of grapes, so he used green- and purple-colored balloons and named his invention Bunch O Balloons. Malone knew he needed to ­protect his invention, so he filed the necessary paperwork with the U.S. Patent and Trademark Office (USPTO).

Then, he waited.

ALTHOUGH AMERICA’S EARLY SYSTEM encouraged innovation, patents weren’t handed out like candy. In fact, they were hard to get. And over time, obtaining a patent became more and more expensive. Filing a patent application with the USPTO involves preparing a detailed document that precisely identifies the invention—more difficult than it may sound. “You’re using words to describe kind of the generic solution to a problem that you’ve identified,” said attorney Daniel Coughlin, who helps inventors secure patents. The inventor must also include artwork that shows how to build or operate the device. The process often requires the inventor to pay an artist to do the drawings, an attorney to make sure the legal arguments are sound, and filing fees, plus the time and money that goes into the invention. Coughlin says on the low end, those costs can easily add up to $20,000.

The USPTO has about 8,000 patent examiners who determine whether the applicant’s invention satisfies the requirements for a patent: It must be an eligible subject matter; the item must be new; it must be non-obvious; and it must have a proper written description. According to Joseph Matal, who formerly served as the acting director of the USPTO, each examiner spends about two dozen hours examining the patent application. “The examiners are very good. They find stuff, but they sometimes don’t find everything,” said Matal, who is now a partner at the law firm Haynes and Boone in Washington, D.C.

With his own patent still pending, Malone launched a Kickstarter campaign. The family prayed God would help them raise $10,000. Within hours, they had exceeded that goal. Within a month, they’d raised nearly $1 million. BuzzFeed wrote about Bunch O Balloons. The Today show invited Josh to have a water balloon fight with Carson Daly in Times Square. Shark Tank called. Malone partnered with the toy manufacturing company Zuru to get his product to market. Things were going swimmingly.

Then, over Thanksgiving weekend in 2014, one of Alison’s friends texted to say she’d seen their product on television, but with a different name. Alison thought her friend must be mistaken. “We looked into it,” Alison recalled. “And it was exactly ours, but blue.” From what the Malones could discern, “As Seen on TV” marketer TeleBrands Corp. bought Bunch O Balloons through Kickstarter, reverse-engineered it, and began selling a knockoff called Balloon Bonanza. The Malones were stunned, but not crushed. Josh sent a cease-and-desist ­letter and told TeleBrands he had a patent pending. But the company didn’t stop selling Balloon Bonanza. (TeleBrands did not respond to a request for comment.)

On June 9, 2015, the USPTO issued Malone a patent for Bunch O Balloons. He thought that meant exactly what the law said it meant: He had the exclusive legal right to make and sell his product for 20 years. The day he got his patent, Malone sued TeleBrands for infringement. He also filed for an injunction, a judicial order that restrains a party from violating another’s right.

TeleBrands fought back. It argued Malone’s written description that the balloons would be “substantially filled” with water was too vague. Malone won the injunction. But three weeks later, TeleBrands modified the initial ­version of its knockoff product and began to sell that.

This time, it argued Malone had failed to meet a ­different criterion for a proper patent: non-obvious. His solution simply involved a tube, a connector, and an O-ring, so it was obvious. Malone pointed out that water balloons first became popular in 1950, and in the 63 years since, nobody had come up with a better solution, so his invention wasn’t obvious.

Three times in three years, TeleBrands sold a modified version of the toy. Each time, Malone filed a new court case. Each case spawned related cases and appeals, all ping-ponging around simultaneously.

Malone wanted his day in court. But he hit a roadblock there, too. In the summer of 2015, TeleBrands challenged the validity of Malone’s patent through the USPTO’s internal administrative process. The federal District Court judge in Texas stayed the initial court case. What followed took Malone on an exhausting journey through America’s current patent system—one that has undergone significant changes since the country’s founding. And one Malone wants to change back.

WHEN THOMAS EDISON APPLIED for a patent on his electric lamp, only seven weeks passed until he got it. By 2011, the process took an average of three years. “One of the things people need to understand is that the patent office has been such a roaring success that about 400,000 patents issue every year,” said Richard Torczon, an attorney in the patent litigation practice at Wilson Sonsini. “Some of those patents are wildly successful. As you might imagine, a lot of them aren’t.”

To deal with the backlog, Congress passed the America Invents Act in 2011. When then-President Barack Obama signed the act into law, he said it would help the patent office deal with the surge of applications: “Right now, there are about 700,000 applications that haven’t even been opened yet.”

A patent dispute in the court system could drag on for a decade. The law attempted to fix that by taking cases away from federal courts and moving them to a Patent Trial and Appeal Board (PTAB), made up of administrative law judges tasked with reviewing patents. The board has the authority to invalidate a patent if it determines it doesn’t meet the requirements after all. “The problem with this is all of the sudden, you have this very powerful tool that is causing review to happen in a federal agency instead of a court,” said Torczon, who formerly served as an administrative patent judge on the PTAB.

Critics argue the PTAB is unconstitutional, and it influences them to render decisions that are overly ­favorable to the agency.

Malone describes the process as brutal. During the hearing, he says he squirmed in his seat, and even stood up at one point to speak, but they didn’t let him testify. In December 2016, the PTAB invalidated Malone’s patent on the grounds of indefiniteness—the description of the balloons being “substantially filled” with water was too vague. Malone was devastated. “I had that awful feeling you get in the pit of your stomach,” he said. “I felt like a victim.” He also felt confused. He no longer had a patent, and yet he still had a court injunction against TeleBrands that prevented the company from infringing on his patent. “It’s really screwy,” said Malone. “The act was supposed to create a faster and cheaper way to resolve disputes, and all it did was delay and multiply.”

On Aug. 11, 2017, Malone stood on the brick sidewalk in front of the USPTO in Alexandria, Va., a gorgeous building with east and west wings joined together by a soaring glass atrium in the middle. He held a lighter in one hand and his patent in the other. Fiddling with the lighter’s spark wheel, Malone looked down at the document he thought secured his legal right to Bunch O Balloons. The original patent is called a ribbon copy because when the USPTO issues it, the document comes with a red ribbon and gold seal on the front. Now that the same agency had declared his patent invalid, Malone considered it worthless. He flicked the lighter and held it to the corner of the paper. Flames immediately began licking it up. He dropped the burning paper into a fire pan and watched his dream go up in smoke.

Supporters of the America Invents Act and the administrative tribunal point out that patent cases often involve complex questions. It’s helpful to use the expertise of the administrative patent judges, which usually exceeds the expertise of garden-variety federal judges or jurors. Matal, the former acting director of the USPTO, helped draft portions of the act and says the administrative judges have advanced knowledge in technology and are well-studied in the specialized area of patent law. Once the cases are assigned, Matal says, the agency tries to match the administrative patent judges’ technical backgrounds with the technology in the patent. For example, if a patent involves a semiconductor, the agency would appoint judges who understand the technology. “Knowing the basics of how a semiconductor works and the terminology, it’s a lot easier to see what’s really being claimed,” he said. “So it’s a huge advantage for accurately making a final determination of obviousness.”

But those who oppose the act argue the Seventh Amendment to the U.S. Constitution grants citizens the right to a jury trial. And that the downsides of the executive branch administrative tribunal outweigh the benefits. Attorney Andy Schlafly frequently files amicus briefs in support of inventors in cases before appellate courts, the Supreme Court, and the USPTO. He insists federal courts are the better option to resolve patent disputes. “The rules of evidence in federal courts have been improved over hundreds of years,” he said. “And they’re pretty good at allowing litigants to bring in experts.” The experts testify and educate jury members or the judge, who listen and learn. Schlafly notes courts do that in other areas where the law is technical, like medical malpractice. If a federal agency took those cases away from the court system and started to appoint administrative judges who had previously worked for a pharmaceutical company, “most people would say no, that that would not be an improvement,” Schlafly said.

Such conflicts of interest within the agency worry Malone. He contends corporations with deep pockets influence the appointment of administrative patent judges. As an example, he cites instances where a PTAB judge who previously worked for a large tech company heard challenges his former employer brought against inventors and made consistent determinations to invalidate the patent. But Matal says behind-the-scenes ­political pressure has benefited patent owners, too.

He cites instances of the PTAB relying on a policy that allowed discretionary denials of patent challenges even when there was a reasonable likelihood the patent didn’t have merit. Still, a 2022 survey conducted by the U.S. Government Accountability Office (GAO) reported that 75 percent of board judges said their independence was influenced by agency leaders. The GAO has made ­recommendations for more transparency, and Matal says improper influence over PTAB cases continues to be a hot topic, even though the Supreme Court recently upheld the constitutionality of the PTAB’s quasi-judicial structure.

If a patent is invalidated, that decision can be appealed to the U.S. Court of Appeals for the Federal Circuit, which is exactly what Malone did. The appeals court overruled the PTAB and found that the language “substantially filled” wasn’t too vague. But the appeals court sent the matter back to the PTAB anyway for further clarification on the question of whether Malone’s solution was obvious or non-obvious, a question the PTAB never answered.

The legal fight continued for a while, but by 2019, TeleBrands was ready to settle. “They realized I wasn’t going to go away,” Malone said. All in all, the fight cost Malone and toy company Zuru $20 million and lasted nearly five years. In the end, a judge ordered Telebrands to pay $31 million in the case involving one Bunch O Balloons knockoff, plus a substantial sum to settle similar cases that arose from the original litigation. And Telebrands agreed to stop selling them all. But most inventors with a patent wouldn’t stand a chance. Malone has seen inventors go bankrupt trying to defend their patents. He’s seen their families torn apart.

MALONE NOW DEDICATES HIS DAYS to patent reform. So much so, he relocated his family from Texas to a neighborhood in northern Virginia. Malone keeps a close watch on PTAB petitions as they’re filed. Then he reaches out to the inventors to let them know they’re about to get a notice in the mail from a challenger who wants to invalidate the patent. When they hear the news, “it’s like they got run over by a bus,” Malone said. “They have no idea where it came from, or what happened, or how to respond.”

On his own dime, Malone flies the inventors to his home and puts them up for free in his basement walkout with two patent-themed guest rooms and a common ­living area. The Wright brothers guest room has a copy of the brothers’ patent with an airplane mobile hanging from the ceiling. The Thomas Edison guest room has antique-style incandescent lightbulb decor. Along with encouragement and support, Malone introduces the inventors to members of Congress and helps them tell their stories.

Malone says the USPTO needs to put more emphasis on making sure patents are issued correctly in the first place so they’re not later invalidated. He says patent examiners, not administrative patent judges, have the scientific expertise to best determine patentability. He hopes to restore America’s patent system to one that rewards individual inventors over big corporations. Most recently, he’s gotten behind a bill proposed by congressman Thomas Massie, R-Ky., that would abolish the PTAB and repeal post-grant reviews.

Malone often reminds himself that God’s providence is at work in all things, and that nothing would exist apart from God and His great gifts—including one man’s skill to see a problem and the ability to invent a solution: “Everything I have is on loan from God.”