1 / 19

The Patent-Antitrust Interface

The Patent-Antitrust Interface. Ted Banks Schoeman, Updike, Kaufman & Scharf. . . . or . . . How We Can Reconcile the Warring Partners. Muddled History. Competing trends in the common law Open competition is best for the economy and no restraints on alienation

roscoe
Download Presentation

The Patent-Antitrust Interface

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. The Patent-Antitrust Interface Ted Banks Schoeman, Updike, Kaufman & Scharf

  2. . . . or . . .How We Can Reconcile the Warring Partners

  3. Muddled History • Competing trends in the common law • Open competition is best for the economy and no restraints on alienation • Property rights are important and the law will provide protection

  4. Making Patent & Antitrust Consistent • Incentive for invention with some competitive protection

  5. Patent & Antitrust Together • Encourage freedom to compete with some protections for little guys.

  6. Antitrust Violations • Conspiracies: more than one party gets together to eliminate competition • Price fixing • Market/customer allocation • Group boycott • Monopolies: one party gets too big

  7. Monopolies & Predation • Cut price below cost: competitors can’t match • After competitors exit, raise prices to recoup • Standard Oil?

  8. Other Antitrust Fun • Various practices reflecting elements of monopoly or conspiracy • Tying • Exclusive Dealing • The FTC Act: unfair or deceptive • It smells wrong, but I’m not sure exactly why it is bad

  9. What is “reasonable?” • Certain practices almost always bad = per se unreasonable (e.g., horizontal price fixing) • The “Rule of Reason”: some practices may be bad, depending on things like • Market shares • Impact on output, price • Alleged benefits of practice

  10. Key Challenge Can you explain to a lay person why you did what you did?

  11. Government vs. Private Enforcement • Most cases private; few trials • Great political fodder: fix the economy with antitrust • Parallel state enforcement • Evolution of DOJ/FTC enforcement philosophy • Bush: more deference to business decisions • Obama: closure scrutiny of practices, particularly where injuries alleged

  12. Who is Hurt? • Injury to a competitor: not necessarily bad • Injury to competition: probably bad • Injury to customer, consumer: probably bad

  13. The Patent Monopoly • Courts accept that a valid patent can be used to exclude others without antitrust liability.

  14. Horizontal Collusion • What happens when competitors get together? • As in price fixing, can be anticompetitive • If necessary to agree with competitors, adopt only those terms that are reasonably necessary

  15. Mandatory Grantbacks • Sounds like collusion, but judged under rule of reason. • Consider: • Exclusivity and rights of licensee • ability to grant sublicenses • scope of inventions covered by grantback • impact on promoting innovation • duration and royalties paid • market power of parties • extent of competition between the parties.

  16. Vertical Restraints • How, where, for how much, goods are re-sold • Law has fluctuated: rule of reason, per se, rule of reason • Price always most sensitive item: Do you really need to control it?

  17. Losing Antitrust Immunity for Your Patent Monopoly • Was the patent obtained by knowing & willful fraud? • Elements of common law fraud proved • No patent without the fraud • Is the suit a sham to interfere with business relationships of a competitor? • Are you trying to do more than the patent actually covers?

  18. Refusing to Deal • Generally, OK • Is there a duty to deal? • Prior course of dealing? • Network effects? • Is there a concerted refusal to deal (license)?

  19. What else is happening? • Princo • Standards • Reverse Payments

More Related