Predatory and Exclusionary Innovation: Which Legal Standard for Software Integration in the Context of Competition v. Intellectual Property Rights Clash?
IIC, Vol. 37, p. 304, 2006
26 Pages Posted: 20 Sep 2005 Last revised: 14 May 2014
This paper aims to address two questions: first, how to identify the legal standard that courts use to assess a specific behavior (software integration) commonly adopted by firms possessing IPRs. Second, whether this standard enables us, on the one hand, to draw a line between predatory and competitive innovation, and, on the other, to strike a balance between: the market leaders' freedom to innovate and the public interest towards the persistence of competitive markets.
The research consists of an examination of the main hardware and software integration cases in the US and the EU, from which a standard echoing the predatory innovation doctrine principles and increasingly aware of network effects and high-tech market features emerges. The conclusion is thus that, as long as IPRs work as incentives to innovate, a system of rivalry is to be maintained. However, when exploitation of IPRs by rightholders becomes a means to limit competition in the market (in that it enables to prevent both competitors and rightholders' further innovation); then IPRs lose the function of innovation incentives and remedies are to be undertaken in order to maintain competition effective in the market.
Keywords: competition law, intellectual property law, software integration, innovation, Microsoft
JEL Classification: K19, K21, K39
Suggested Citation: Suggested Citation