Whenever you hear stories like this, it's easy for people to call out for the elimination of all patents (just need to take a cursory look at the comments above). However, while the patent system needs reform, we still need patents.
In many industries, companies would a lot of resources into R&D to come up with new inventions. If you let everyone random person/company come afterwards, reverse engineer the end-product, the company that invested all that R&D money will be at a complete loss. This situation is somewhat similar to the "legacy costs" of the big 3 auto manufacturers. They incurred all those labor costs (e.g. pensions, etc.) which is not an issue for the new companies, and as such are at a significant disadvantage in the market place. Similarly, if a company spends a lot of R&D money, but have to compete with other companies that DON'T have the R&D costs, but make the same product (due to no patents), the initial company will go belly up very quickly.
Of course, this doesn't mean that all patents are good. MOST patents that I've seen are very obvious and get granted only b/c the patent examiner doesn't have enough time to really fight it out. The point system in the USPTO is a farce - when it comes to filtering out crappy inventions. While I completely agree that we need reform, calling for the all out elimination of the patent system is not any less foolish than continuing with the system we have now.