Patent Misuse and Antitrust: An Empirical Study
The John Marshall Law School
July 10, 2011
Daryl Lim, PATENT MISUSE AND ANTITRUST: AN EMPIRICAL STUDY, Edward Elgar, 2011
This empirical study seeks to present a systematic, comprehensive account of the recent history of patent misuse case law, its actual state and its relationship with antitrust law. The study is based on the use of case content analysis complemented by interviews. The findings present an analysis of how federal judges who employed patent misuse did so, and how patent misuse is current perceived by contemporary judges, academics, government officials, and lawyers.
Conventional legal doctrine derives from a small set of cases selected by case reporters and academics. This study will determine whether that conventional wisdom in fact has empirical support. It highlights key aspects of patent misuse, including the way it has been interwoven with antitrust principles. The study is based on the use of case content analysis complemented by interviews. The findings present an empirical analysis of how federal judges who employed patent misuse did so, and how patent misuse is current perceived by contemporary judges, academics, government officials, and lawyers. It also provides an indication of whether more in-depth research is required to unravel the nature and extent of the interaction between patent misuse and antitrust. This study does not set out to analyze case law. Cases are relevant only to the extent that they stated a policy position, or featured as a variable in the study, or example as a precedent, whose citation which could be quantified.
The study begins by setting the stage. It presents relevant facets of data on patent misuse to provide an appreciation of the issues that follow. It explains how cases are distributed, for example by circuit, posture and industry. It also presents the outcomes of cases which have considered patent misuse without reference to antitrust, or both patent misuse and antitrust, in preparation for the discussion on the relationships between them that follows. Finally, it presents the rich and diverse categories of misuse which have appeared over the years.
The second part of the study focuses on the intersection of patent misuse and antitrust law. It begins by examining what factors go into determining when patentees exceed the scope of their rights. Specifically, it attempts to deconstruct the analytical process judges employ, and articulate the policies driving patent misuse that have been obscured by rhetoric in the opinions. The second part then proceeds to offer reasons for the contraction of patent misuse over the years. In particular, it examines the effect the Patent Misuse Reform Act of 1988 and federal appellate jurisprudence on re-delineating the scope of patent misuse. The final part concludes with observations on relevant areas suitable for the application of a reinvigorated patent misuse doctrine. In this regard, the relevant literature, as well as courts and commentators, point to licensing misconduct involving standard setting organizations and settlements between owners of patented drugs and generic drug companies as examples where patent misuse may meaningfully contribute. In addition, patent misuse has also been identified as providing an important foundation for derivative doctrines, such as copyright misuse, to take root and flourish.
The study juxtaposes language from judicial opinions with statistics and insights from interviewees where appropriate. The significant question for this paper is not which view of patent misuse is best. Rather the focus is on determining the scope of patent misuse according to court opinions and perceptions in practice.
Date posted: July 10, 2011 ; Last revised: December 29, 2013