If you’re an inventor, engineer, or programmer—if you’re an entrepreneur, owner, or prime mover in a business—if you use technology to make better products for your customers—
Here’s a toast to you!
More than a toast, my gift to you today is one of inspiration—the true story of Edwin Land, Polaroid, and the Kodak patent war. It’s all written for us in the substantial book by Ronald K. Fierstein titled Triumph of Genius (2015). My gift, more modest in price than a book or a camera, is this article, essentially, a book review with valuable tips for inventors and business owners.
The story of Edwin Land is that of the invention and success of instant photography before there was digital. No one who saw the magic of Polaroid in, say, 1970, will ever forget seeing a photographic print emerge from a camera box and develop right in front of their very eyes. It’s still magic today, though, in one of many ironies, Polaroid has exited the business in favor of Fujifilm (see accompanying illustration) and the aptly named Impossible Project, which are competing to sell millions of new and refurbished instant cameras.
What did Edwin Land and his patented inventions accomplish? Polaroid Corporation had peak employment of 21,000 workers in 1978. Its peak revenues reached $3 billion in 1991. Today, after repeated bankruptcies, it is a shadow of its former self, as digital photography and smartphone cameras have relegated instant film to the status of a curiosity. The Impossible Project and Fujifilm are left to carry the torch, or, should I say, the light of instant photography.
The one-time giant Kodak has had its rise and fall, too. Founded by George Eastman in 1888, Kodak led the photographic film industry for the entire 20th century, hitting $16 billion in annual sales in 1996 before it was decimated first by foreign competition and then by the same digital technology that felled Polaroid.
Author Ronald Fierstein knows whereof he writes. He was one of the Three Musketeers, as he dubbed them at page 539 of Triumph, who supported patent trial lawyer Herb Schwartz in the trenches of Fish & Neave in litigating Polaroid v. Kodak.
The story of Edwin Land and Polaroid is almost literally incredible. Mr. Land was indeed a genius. For him to imagine and then to invent a film that developed itself was nothing short of astonishing. He patented that instant film technology, too, in the same way that George Eastman before him patented basic inventions in photography.
There are warnings here, too. There’s the danger of the upstart Polaroid going to the established Kodak for assistance and supplies. There’s the danger of being the established company and trying to crush the upstart only to be held fully accountable by the courts.
Accountable: On September 13, 1985, U.S. District Judge Rya Zobel held Kodak liable for infringing Polaroid’s patents. See Polaroid v. Kodak (D. Mass.).
I was there, in the U.S. Court of Appeals for the Federal Circuit, on January 6, 1986, when Francis Carr of Kenyon & Kenyon and Herb Schwartz of Fish & Neave presented their oral arguments in the appeal in Polaroid v. Kodak.
I was there in my capacity as law clerk to the Hon. Edward S. Smith, Circuit Judge, who with the Hon. Pauline Newman, flanked Chief Judge Howard T. Markey on the bench.
I read closely the appellate briefs submitted after the 74-day trial. I studied the several Polaroid patents held to be valid and infringed by Kodak. I saw the Federal Circuit uphold the district court’s injunction, which instantly (no pun intended) rendered useless the millions of Kodak instant cameras that had already been sold as well as the large inventories on the shelves of retail stores.
I read the newspapers and their suggestions of what Kodak should do with millions of now-useless Kodak instant cameras. One suggestion that still lingers in my memory was that Kodak should build a giant totem pole of plastic cameras in front of its headquarters in Rochester, New York.
The Federal Circuit’s subsequently issued opinion on the merits affirmed the appealed portions of the district court’s judgment in all respects.
I later watched the news unfold as the district court ordered Kodak to pay Polaroid over $900 million in damages. Yes, more than $900 million was actually paid by Kodak to Polaroid to avoid yet another appeal. See Triumph, page 504. (Even now, Merck is gunning for an even bigger payday.) Kodak incurred additional actual costs of the larger part of another billion dollars in removing instant cameras and film from shelves, shutting down factory operations, and settling class actions filed by unhappy customers. Id. at 501.
The irony of course is that instant photography and the two businesses that fought the war all ended up on the scrap heap. Id. at 515. (Who’d have guessed even two years ago that phoenixes would be rising from those ashes.)
Here are three lessons from Polaroid:
- Invent something,
- Patent it, and
- Make and sell it for profit.
One lesson from Kodak: Trample on your upstart competitor’s patents at your own peril!
Another lesson, from instant photography: Keep your eye out for the new, new thing.
May you have much success in your acts of inventing, patenting, and making and selling for profit.