Intellectual Property Law Commons^™

The Actavis Inference: Theory And Practice, Aaron S. Edlin, C. Scott Hemphill, Herbert J. Hovenkamp, Carl Shapiro

Aaron Edlin

In FTC v. Actavis, Inc., the Supreme Court considered "reverse payment" settlements of patent infringement litigation. In such a settlement, a patentee pays the alleged infringer to settle, and the alleged infringer agrees not to enter the market for a period of time. The Court held that a reverse payment settlement violates antitrust law if the patentee is paying to avoid competition. The core insight of Actavis is the Actavis Inference: a large and otherwise unexplained payment, combined with delayed entry, supports a reasonable inference of harm to consumers from lessened competition.This paper is an effort to assist courts and …

Activating Actavis, Aaron Edlin, C. Scott Hemphill, Herbert J. Hovenkamp, Carl Shapiro

Aaron Edlin

In Federal Trade Commission v. Actavis, Inc., the Supreme Court provided fundamental guidance about how courts should handle antitrust challenges to reverse payment patent settlements. The Court came down strongly in favor of an antitrust solution to the problem, concluding that “an antitrust action is likely to prove more feasible administratively than the Eleventh Circuit believed.” At the same time, Justice Breyer’s majority opinion acknowledged that the Court did not answer every relevant question. The opinion closed by “leav[ing] to the lower courts the structuring of the present rule-of-reason antitrust litigation.”This article is an effort to help courts and counsel …

Actavis And Error Costs: A Reply To Critics, Aaron S. Edlin, C. Scott Hemphill, Herbert J. Hovenkamp, Carl Shapiro

Aaron Edlin

The Supreme Court’s opinion in Federal Trade Commission v. Actavis, Inc. provided fundamental guidance about how courts should handle antitrust challenges to reverse payment patent settlements. In our previous article, Activating Actavis, we identified and operationalized the essential features of the Court’s analysis. Our analysis has been challenged by four economists, who argue that our approach might condemn procompetitive settlements.As we explain in this reply, such settlements are feasible, however, only under special circumstances. Moreover, even where feasible, the parties would not actually choose such a settlement in equilibrium. These considerations, and others discussed in the reply, serve to confirm …

Sports And The Law: Text, Cases, And Problems, 5th, Stephen Ross, Paul Weiler, Gary Roberts, Roger Abrams

Stephen F Ross

This casebook introduces students to the fundamentals of labor, antitrust, and intellectual property law as applied in the professional and amateur sporting industries. It covers the unique office of the league commissioner and special concerns with the “best interests of sports”; the contract, antitrust, and labor law dimensions of the player-labor market; the peculiar institution of the player agent in a unionized industry; the economic and legal implications of agreements among league owners and responses to rival leagues; the system of commercialized college athletics governed by the NCAA and how law impacts individual sports like golf, tennis and boxing; as …

Empirical Evidence Of Drug Pricing Games - A Citizen's Pathway Gone Astray, Robin C. Feldman, Evan Frondorf, Andrew Cordova

Robin C Feldman

Patent Misuse And Antitrust: Rebirth Or False Dawn?, Daryl Lim

Daryl Lim

This Article examines how two recent cases, F.T.C. v. Actavis and Kimble v. Marvel Enterprises Inc. could affect both the equitable defense of patent misuse and the patent-antitrust interface more generally. It begins by tracing the history of patent misuse and its reformulation into an “antitrust-lite” doctrine by the Federal Circuit. This Article presents new empirical data confirming this reformulation, and unveils the surprising influence of the Seventh Circuit and the Chicago School on that reformulation. The Article then explores Actavis and Kimble. It explains why Actavis will catalyze more antitrust challenges when patent rights are exercised, and why it …

Antitrust And Information Technologies, Herbert Hovenkamp

Herbert Hovenkamp

Technological change strongly affects the use of information to facilitate anticompetitive practices. The effects result mainly from digitization and the many products and processes that it enables. These technologies also account for a significant portion of the difficulties that antitrust law encounters when its addresses intellectual property rights. Changes in the technologies of information also affect the structures of certain products, in the process either increasing or decreasing the potential for competitive harm. For example, digital technology affects the way firms exercise market power, but it also imposes serious measurement difficulties. In purely digital markets intellectual property rights are crucial …

Antitrust And The Patent System: A Reexamination, Herbert Hovenkamp

Herbert Hovenkamp

Since the federal antitrust laws were first passed they have cycled through extreme positions on the relationship between competition law and the patent system. Previous studies of antitrust and the patent system have generally assumed that patents are valid, discrete, and generally of high quality in the sense that they further innovation. As a result, increasing the returns to patenting increases the incentive to do socially valuable innovation. Further, if the returns to the patentee exceed the social losses caused by increased exclusion, the tradeoff is positive and antitrust should not interfere. If a patent does nothing to further innovation, …

Federalism, First Amendment & Patents: The Fraud Fallacy, Robin C. Feldman

Robin C Feldman

Living With Monsanto, Daryl Lim

Daryl Lim

Bowman v. Monsanto Co. signaled the end of an era of seed saving. Farmers must buy new seed for replanting or risk patent infringement. The familiar rhetoric of oppressed farmers belies the fact that Monsanto’s success rests in part on farmers prizing its innovations. Current trends indicate that this reliance on Monsanto will continue. The Supreme Court correctly found for Monsanto. However, future cases must iron out the kinks in the Bowman decision. Despite the Court’s best intentions, inadvertence cannot shield farmers from patent infringement. The Court must also make it clear that patentees cannot use licensing restrictions to claw …

Living With Monsanto, 2015 Mich. St. L. Rev. 559 (2015), Daryl Lim

Daryl Lim

Monopolization, Innovation, And Consumer Welfare, John Lopatka, William Page

William H. Page

While most commentators and the enforcement agencies voice support for the consumer welfare standard, substantial disagreement exists over when economic theory justifies a presumption of consumer injury. Virtually all would subscribe to the theoretical prediction that an effective cartel will likely inflict consumer injury by reducing output and thus increasing prices. But the academic and judicial consensus disappears when the theory at issue predicts that a practice -- a merger or a predatory pricing campaign, for example -- will harm consumers in the future through some complex sequence of events.

In our view, the desire to protect innovation is legitimate, …

The Rule Of Reason And The Scope Of The Patent, Herbert Hovenkamp

Herbert Hovenkamp

For a century and a half the Supreme Court has described perceived patent abuses as conduct that reaches "beyond the scope of the patent." That phrase, which evokes an image of boundary lines in real property, has been applied to both government and private activity and has many different meanings. It has been used offensively to conclude that certain patent uses are unlawful because they extend beyond the scope of the patent. It is also used defensively, however, to characterize activities as lawful if they do not extend beyond the patent's scope. In the first half of the twentieth century …

Patents, Antitrust, And The Rule Of Reason, Herbert Hovenkamp

Herbert Hovenkamp

Antitrust law has historically immunized many patent agreements if they fell within the "scope of the patent." Three dissenting Justices in the Actavis case advocated this test: a pharmaceutical pay-for-delay settlement falls within the scope of the patent if it delays a competitor's entry no longer than the remaining life of the patent. In that case the patentee will not be obtaining any more than it would from a valid patent -- namely, the right to exclude infringers for the full patent term.

The "scope of the patent" test is not useful for defining the boundaries of antitrust immunity in …

International Cooperation And The Patent-Antitrust Intersection, Stephen Yelderman

Stephen Yelderman

Commentators have long recognized the need to coordinate questions at the patent-antitrust intersection with other policy levers available under patent law. In the international context, however, control over patent policy has been fractured and entrusted to diverse decisionmakers. Many details of patent law are tightly coordinated by international agreement, while others related to antitrust are left to national discretion. This Article evaluates the consequences of this fracture, and notes ways in which the prevailing treaty regimes (the Paris Convention and the TRIPS Agreement) distort incentives for national policymaking. National discretion at the patent-antitrust intersection can be expected to result in …

Antitrust Analysis After Actavis: Applying The Rule Of Reason To Reverse Payments, Benjamin Miller

Benjamin Miller

Abstract In F.T.C. v. Actavis, Inc. the Supreme Court resolved a circuit split regarding the proper evaluation of reverse payment settlements under federal antitrust law, holding that they must be evaluated under a rule of reason analysis. However, the Court simultaneously created significant uncertainty by declaring that the lower courts were responsible for structuring the analysis. While a few cases are currently in the pre-trial phase, the only decisions relating to reverse payments since Actavis have been rulings on pre-trial motions—there have been no decisions on the merits. Given the intricate intersection between antitrust and intellectual property principles in these …

Refusals To Deal With Competitors By Owners Of Patents And Copyrights: Reflections On The Image Technical And Xerox Decisions, Joseph P. Bauer

Joseph P. Bauer

Under the patent and copyright laws, the owner of a patent for an invention or of a copyright for a work has the right to sell, license or transfer it, to exploit it individually and exclusively, or even to decide to withhold it from the public. By contrast, under the antitrust laws, a unilateral refusal to deal may constitute an element of a violation of Section 2 of the Sherman Act, and the courts may then impose a duty on the violator to deal with others, including possibly with its actual or would-be competitors. The central question addressed by this …

Beyond Napster: Using Antitrust Law To Advance And Enhance Online Music Distribution, Matthew Fagin, Frank Pasquale, Kim Weatherall

Frank A. Pasquale

What should be the broad principles guiding the copyright and competition policy governing online music? In short, what are the key concerns or values that we want preserved in relation to the distribution of music online? We will outline the background to the present investigations and existing law in Part I and argue in Part II that these concerns can be encapsulated in two broad areas: (1) the preservation of some scope for private and personal use and (2) the encouragement and growth of a diverse sector for the distribution of copyrighted works online. We also argue that, at least …

Rankings, Reductionism, And Responsibility, Frank Pasquale

Frank A. Pasquale

After discussing how search engines operate, and sketching a normative basis for regulation of the rankings they generate, this piece proposes some minor, non-intrusive legal remedies for those who claim that they are harmed by search engine results. Such harms include unwanted (but high-ranking) results relating to them, or exclusion from high-ranking results they claim they are due to appear on. In the first case (deemed inclusion harm), I propose a right not to suppress the results, but merely to add an asterisk to the hyperlink directing web users to them, which would lead to the complainant's own comment on …

Beyond Microsoft: Intellectual Property, Peer Production And The Law’S Concern With Market Dominance., Daryl Lim

Daryl Lim

No abstract provided.

Reviving An Epithet: A New Way Forward For The Essential Facilities Doctrine, Sandeep Vaheesan

Sandeep Vaheesan

For sound economic reasons, the antitrust laws, in general, do not require firms to share their assets with rivals. When a particular asset has natural monopoly characteristics and is used as an input in other markets, however, the essential facilities doctrine requires that the asset be shared with firms in related markets. In recent decades, the Supreme Court and leading scholars have criticized the doctrine, claiming it is economically inefficient and taxes the institutional capacity of the judiciary.

Historically, the courts most often applied the doctrine to tangible natural monopolies like electric transmission grids and bottleneck railroad lines. In recent …

Understanding The Solution For Microsoft, Ivo T. Gico

Ivo Teixeira Gico Jr.

Nesse artigo, o autor examinou a solução do caso da Microsoft, tentando responder as seguintes perguntas: Seria a Microsoft responsável pelo monopólio do mercado de sistemas operacionais e pela vinculação ilegal no mercado de navegadores? Qual seria a solução menos drástica e intrusiva que poderia solucionar todas as acusações? Teria o Judiciário encontrado uma solução equilibrada para criar a competção sem destruir a Microsoft? Que abordagem seria melhor?

In this paper, the author examines the issue of relief in the Microsoft case, trying to answer the following questions: Is Microsoft liable for monopolization on the operating system market and illegal …