Antitrust Issues in Intellectual Property Cases
Proceedings of the ABA Antitrust Section Spring Meeting, Fundamentals Program, pp. 341-374, 2005
34 Pages Posted: 12 Jun 2009
Antitrust issues in intellectual property cases arise mainly in commercial disputes involving patents, although antitrust issues also come up in the copyright context. This paper’s primary focus is the patent/antitrust interface.
Are the antitrust and patent laws in tension? Antitrust promotes marketplace competition; patent law creates temporary monopolies that impede competition because the patented invention can not be copied and sold without permission of the patent owner. The intersection of these two critically important fields of law clearly involves some dissonance. The common ground is that the antitrust and patent laws seek to achieve same goal - consumer welfare - through different mechanisms. Antitrust enhances consumer welfare by promoting competition in the marketplace. Patent law enhances consumer welfare by enhancing competition in ideas through patent law’s disclosure requirements and by creating incentives for the introduction of new inventions.
This paper reviews the most commonly disputed legal issues at the patent/antitrust interface. For example, patent licensing activity between patent owners and third parties, as well as other contractual arrangements between multiple patent owners, may give rise to collusive concerns under Section One of the Sherman Act. Section One principles also impact mergers and acquisitions between patent-owning firms. Patent enforcement and refusals to license are unilateral forms of conduct that may give rise to antitrust concerns under Section Two of the Sherman Act. The paper concludes by discussing appellate jurisdiction and choice of law issues unique to the patent/antitrust interface.
Keywords: intellectual property law, patent law, antitrust law, Sherman Act, Sherman One, Sherman Two, competition, consumer welfare, commercial disputes, licensing, disclosure, incentives, appellate jurisdiction, choice of law
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