Saturday, May 29, 2010

Insider Patenting: How Fannie Mae Chief Got the Patent for Cap and Trade in 2006

by John Bambenek

Just one day after the Democrats seized control of Congress, the Chief Executive of Fannie Mae, Franklin Raines, received the patent for a residential cap-and-trade-system (Patent 6904336).  What this means is that Raines, along with several colleagues who also "own" the patent, could stand to make huge amounts of money if the cap-and-trade regime was ever brought to the residential marketplace.  What does this have to do with Fannie Mae?  Absolutely nothing.

To understand the implications, a little discussion about patenting is needed.  Patents are basically "ownership" rights to an invention.  If you invent something, you can license it to others to produce and collect royalties.  Each year, thousands of patents are sent to the US Patent Office for consideration.  Many "patent houses" simply put in very general patents so they can turn around and sue businesses later for "stealing" their inventions.  Sometimes it's legit, many times it's bogus.

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