Mark Cuban Criticizes Commerce Department's Patent Value Levy Plan, Calls It "One of the Dumbest Ideas in Business"

Mark Cuban has criticized a proposed Commerce Department plan to charge patent holders a percentage of their patent value, calling it "one of the dumbest ideas in the history of business." The plan, under discussion to raise revenue, would act like a recurring tax on intellectual property and saddle owners with unpredictable costs. Critics argue that valuing millions of active US patents would be difficult and that the US would become an outlier among major patent systems.

Billionaire investor Mark Cuban has publicly lambasted a proposed Commerce Department plan to charge patent holders a percentage of their patent value, labeling it "one of the dumbest ideas in the history of business." The plan, under discussion to raise revenue, would act like a recurring tax on intellectual property and saddle owners with unpredictable costs. Cuban's criticism adds a high-profile voice to a growing resistance across tech, life sciences, and manufacturing sectors [1].

The proposed plan, part of Commerce Secretary Howard Lutnick's revenue-raising push, aims to charge patent holders between 1% to 5% of a patent's overall value. This would either replace or supplement today's fee schedule, a shift that critics argue would act like a recurring tax on intellectual property and saddle owners with unpredictable costs [1]. The plan is part of a broader discussion on how the U.S. can address its national debt through innovative revenue-raising measures.

Analysts and industry groups have raised concerns over the plan's feasibility. Valuing millions of active U.S. patents would be challenging, and the U.S. would become an outlier among major patent systems that traditionally charge flat fees [1]. Brad Watts, senior vice president at the U.S. Chamber of Commerce’s Global Innovation Policy Center, called it a "paradigm shift" that would upend a 235-year-old practice [1].

Critics, including legal and industry groups, have signaled pushback. Patent scholars at Patently-O warned that a 1%–5% value tax would "dramatically increase costs" and make the U.S. an international anomaly [1]. The Chamber of Commerce expressed concerns that the plan could undermine the nation's innovation ecosystem [1].

Cuban's criticism is not the first time he has sparred publicly with Lutnick. In May, Cuban mocked the secretary on social media, showcasing a growing clash over how Washington funds government priorities without chilling private-sector invention [1].

The proposed plan faces significant hurdles. The complexity of patent valuation, the potential for increased patent abandonment, and the risk of undermining the U.S.'s innovation ecosystem are among the key concerns. The plan could also lead to a shift in patenting strategies, with companies potentially moving towards defensive publication policies to avoid the costs associated with patenting [2].

In conclusion, Mark Cuban's criticism of the proposed patent value tax plan highlights the potential challenges and risks associated with the plan. The plan's feasibility and impact on the U.S. patent system and innovation ecosystem remain uncertain, and it will be crucial for policymakers to consider these factors as they move forward.

References:
[1] https://www.benzinga.com/news/legal/25/07/46781487/mark-cuban-says-this-trump-administration-move-is-one-of-the-dumbest
[2] https://ipwatchdog.com/2025/07/28/purported-plan-charge-patent-owners-percentage-patent-value-fraught-peril/id=190705/