Law Commons^™

The Innovation Commons, Herbert J. Hovenkamp

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This book of CASES AND MATERIALS ON INNOVATION AND COMPETITION POLICY is intended for educational use. The book is free for all to use subject to an open source license agreement. It differs from IP/antitrust casebooks in that it considers numerous sources of competition policy in addition to antitrust, including those that emanate from the intellectual property laws themselves, and also related issues such as the relationship between market structure and innovation, the competitive consequences of regulatory rules governing technology competition such as net neutrality and interconnection, misuse, the first sale doctrine, and the Digital Millennium Copyright Act (DMCA). Chapters …

Distributive Justice And Consumer Welfare In Antitrust, Herbert J. Hovenkamp

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The dominant view of antitrust policy in the United States is that it is intended to promote some version of economic welfare. More specifically, antitrust promotes allocative efficiency by ensuring that markets are as competitive as they can practicably be, and that firms do not face unreasonable roadblocks to attaining productive efficiency, which refers to both cost minimization and innovation.

The distribution concern that has dominated debates over United States antitrust policy over the last several decades is whether antitrust should adopt a “consumer welfare” principle rather than a more general neoclassical “total welfare” principle. In The Antitrust Paradox Robert …

Competition For Innovation, Herbert J. Hovenkamp

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Both antitrust and IP law are limited and imperfect instruments for regulating innovation. The problems include high information costs and lack of sufficient knowledge, special interest capture, and the jury trial system, to name a few. More fundamentally, antitrust law and intellectual property law have looked at markets in very different ways. Further, over the last three decades antitrust law has undergone a reformation process that has made it extremely self conscious about its goals. While the need for such reform is at least as apparent in patent and copyright law, very little true reform has actually occurred.

Antitrust has …

Constitutionally Tailoring Punishment, Richard A. Bierschbach, Stephanos Bibas

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Since the turn of the century, the Supreme Court has begun to regulate non-capital sentencing under the Sixth Amendment in the Apprendi line of cases (requiring jury findings of fact to justify sentence enhancements) as well as under the Eighth Amendment in the Miller and Graham line of cases (forbidding mandatory life imprisonment for juvenile defendants). Though both lines of authority sound in individual rights, in fact they are fundamentally about the structures of criminal justice. These two seemingly disparate lines of doctrine respond to structural imbalances in non-capital sentencing by promoting morally appropriate punishment judgments that are based on …

Anticompetitive Patent Settlements And The Supreme Court's Actavis Decision, Herbert J. Hovenkamp

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In FTC v. Actavis the Supreme Court held that settlement of a patent infringement suit in which the patentee of a branded pharmaceutical drug pays a generic infringer to stay out of the market may be illegal under the antitrust laws. Justice Breyer's majority opinion was surprisingly broad, in two critical senses. First, he spoke with a generality that reached far beyond the pharmaceutical generic drug disputes that have provoked numerous pay-for-delay settlements.

Second was the aggressive approach that the Court chose. The obvious alternatives were the rule that prevailed in most Circuits, that any settlement is immune from antitrust …

Patent Value And Citations: Creative Destruction Or Strategic Disruption?, David S. Abrams, Ufuk Akcigit, Jillian Popadak

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Prior work suggests that more valuable patents are cited more and this view has become standard in the empirical innovation literature. Using an NPE-derived dataset with patent-specific revenues we find that the relationship of citations to value in fact forms an inverted-U, with fewer citations at the high end of value than in the middle. Since the value of patents is concentrated in those at the high end, this is a challenge to both the empirical literature and the intuition behind it. We attempt to explain this relationship with a simple model of innovation, allowing for both productive and strategic …

Innovation, Ip Rights, And Anticompetitive Exclusion, Herbert J. Hovenkamp

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This book of CASES AND MATERIALS ON INNOVATION AND COMPETITION POLICY is intended for educational use. The book is free for all to use subject to an open source license agreement. It considers numerous sources of competition policy in addition to antitrust, including those that emanate from the intellectual property laws themselves, and also related issues such as the relationship between market structure and innovation, the competitive consequences of regulatory rules governing technology competition such as net neutrality and interconnection, misuse, the first sale doctrine, and the Digital Millennium Copyright Act (DMCA). Chapters will be updated frequently. The author uses …

Resource Movement And The Legal System, Herbert J. Hovenkamp

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In "The Problem of Social Cost" Ronald Coase considered several common law disputes among neighbors whose economic activities conflicted with one another. For example, Sturges v. Bridgman was a nineteenth century nuisance case involving a pediatrician whose practice was hindered by his neighbor, a confectioner whose operation required a noisy mechanical mortar & pestle. Coase showed that if high transaction costs did not interfere, private bargaining would provide a solution which he characterized as efficient -- namely, that the right to continue would be given to the person who valued it most. For example, if the pediatrician valued the right …

Migrant Workers’ Access To Justice At Home: Indonesia, Bassina Farbenblum, Eleanor Taylor-Nicholson, Sarah Paoletti

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Each year, around half a million Indonesians travel abroad to work, half of those to the Middle East. They are typically women from small cities or villages with primary education and limited work experience, hired to perform domestic work. Many suffer abuse and exploitation but have virtually no access to recourse within their host country’s legal system.

The vulnerability of migrant workers abroad makes it crucial for them to be able to seek redress in their own countries. Access to justice at home also allows for redress when home governments and private recruitment businesses breach their legal responsibilities to migrant …

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

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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 …

Coase, Herbert J. Hovenkamp

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This brief essay considers the career, contributions, and influence of Ronald Coase, who passed away in September, 2013. Comments are welcome.

Can Pensions Be Restructured In (Detroit’S) Municipal Bankruptcy?, David A. Skeel Jr.

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This paper, which was written as a White Paper for the Federalist Society, describes and assesses the question whether public employee pensions can be restructured in bankruptcy, with a particular focus on Detroit. Part I gives a brief overview both of the treatment of pensions under state law, and of the Michigan law governing the Detroit pensions. Part II explains the legal argument for restructuring an underfunded pension in bankruptcy. Part III considers the major federal constitutional objections to restructuring, Part IV discusses arguments based on the Michigan Constitution, and Part V assesses several Chapter 9 arguments against restructuring. None …

Institutional Advantage In Competition And Innovation Policy, Herbert J. Hovenkamp

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In the United States responsibility for innovation policy and competition policy are assigned to different agencies with different authority. The principal institutional enforcers of patent policy are the United States Patent and Trademark Office (USPTO), the International Trade Commission (ITC), and the federal district courts as overseen by the United States Court of Appeals for the Federal Circuit, and ultimately the Supreme Court. While competition policy is not an explicit part of patent policy, competition issues arise frequently, even when they are not seen as such.

Since early in the twentieth century antitrust courts have had to confront practices that …

Secondary-Line Differential Pricing And The Robinson-Patman Act, E. Thomas Sullivan, Herbert J. Hovenkamp, Howard A. Shelanski, Christopher R. Leslie

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Because it is taught infrequently, the full text of Chapter 8 of our antitrust casebook, on the Robinson-Patman Act, is now posted online and free for anyone to use. This chapter covers all issues related to secondary-line enforcement, the "cost justification," "meeting competition," and other defenses, as well as buyers' liability. Primary-line enforcement is still covered with the materials on predatory pricing in Chapter 6.

The Taxation Of Cloud Computing And Digital Content, David Shakow

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“Cloud computing” raises important and difficult questions in state tax law, and for Federal taxes, particularly in the foreign tax area. As cloud computing solutions are adopted by businesses, items we view as tangible are transformed into digital products. In this article, I will describe the problems cloud computing poses for tax systems. I will show how current law is applied to cloud computing and will identify the difficulties current approaches face as they are applied to this developing technology.

My primary interest is how Federal tax law applies to cloud computing, particularly as the new technology affects international transactions. …

Can Consumers Make Affordable Care Affordable? The Value Of Choice Architecture, Eric J. Johnson, Ran Hassin, Tom Baker, Allison T. Bajger, Galen Treuer

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Starting this October, tens of millions will be choosing health coverage on a state or federal health insurance exchange as part of the Patient Protection and Affordable Care Act. We examine how well people make these choices, how well they think they do, and what can be done to improve these choices. We conducted 6 experiments asking people to choose the most cost-effective policy using websites modeled on current exchanges. Our results suggest there is significant room for improvement. Without interventions, respondents perform at near chance levels and show a significant bias, overweighting out-of-pocket expenses and deductibles. Financial incentives do …

Putting The Trial Penalty On Trial, David S. Abrams

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The "trial penalty" is a concept widely accepted by all the major actors in the criminal justice system: defendants, prosecutors, defense attorneys, court employees, and judges. The notion is that defendants receive longer sentences at trial than they would have through plea bargain, often substantially longer. The concept is intuitive: longer sentences are necessary in order to induce settlements and without a high settlement rate it would be impossible for courts as currently structured to sustain their immense caseload. While intuitively appealing, this view of the trial penalty is completely at odds with economic prediction. Since both prosecutors and defendants …

Bankruptcy And Economic Recovery, Thomas H. Jackson, David A. Skeel Jr.

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To measure economic growth or recovery, one traditionally looks to metrics such as the unemployment rate and the growth in GDP. And in terms of figuring out institutional policies that will stimulate economic growth, the focus most often is on policies that encourage investment, entrepreneurial enterprises, and reward risk-taking with appropriate returns. Bankruptcy academics that we are, we tend to add our own area of expertise to this stable— with the firm belief that thinking critically about bankruptcy policy is an important element of any set of institutions designed to speed economic recovery. In this paper, written for a book …

Shots For Tots?, Eric A. Feldman

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By endorsing the use of a vaccine that makes the experience of puffing on a cigarette deeply distasteful, Lieber and Millum have taken the first few tentative steps into a future filled with medical interventions that manipulate individual preferences. It is tempting to embrace the careful arguments of “Preventing Sin” and celebrate the possibility that the profound individual and social costs of smoking will finally be tamed. Yet there is something unsettling about the possibility that parental discretion may be on the cusp of a radical expansion, one that involves a new and unexplored approach to behavior modification.

Property Lost In Translation, Abraham Bell, Gideon Parchomovsky

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The world is full of localized, non-standard property regimes that co-exist alongside state property laws. This Article provides the first comprehensive look at the phenomenon of localized property systems, and the difficulties that necessarily attend the translation of localized property rights.

Rather than survey the numerous localized property systems in the world, this Article explores the common features of the interaction between localized and state property systems. All localized property systems entail translation costs with the wider state property systems around them. Translation costs result from incompatibilities, as well as information and enforcement costs. Focusing on translation costs, the Article …

The Wires Go To War: The U.S. Experiment With Government Ownership Of The Telephone System During World War I, Michael A. Janson, Christopher S. Yoo

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One of the most distinctive characteristics of the U.S. telephone system is that it has always been privately owned, in stark contrast to the pattern of government ownership followed by virtually every other nation. What is not widely known is how close the United States came to falling in line with the rest of the world. For the one-year period following July 31, 1918, the exigencies of World War I led the federal government to take over the U.S. telephone system. A close examination of this episode sheds new light into a number of current policy issues. The history confirms …

Striking The Right Balance: Investor And Consumer Protection In The New Financial Marketplace: Introduction, Lisa Fairfax, Arthur E. Wilmarth Jr

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On March 2, 2012, The George Washington University Law School's Center for Law, Economics & Finance and The George Washington Law Review jointly hosted a symposium entitled "Striking the Right Balance: Investor and Consumer Protection in the New Financial Marketplace."' The symposium focused on two principal topics. First, participants analyzed the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank") on investors and consumers in three areas of federal regulation-securities markets, derivatives markets, and consumer financial products. Second, the symposium evaluated the Sarbanes-Oxley Act of 2002 ("Sarbanes-Oxley") on its tenth anniversary and considered whether Sarbanes-Oxley's legacy might …

Neuroscience And The Future Of Personhood And Responsibility, Stephen J. Morse

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This is a chapter in a book, Constitution 3.0: Freedom and Technological Change, edited by Jeffrey Rosen and Benjamin Wittes and published by Brookings. It considers whether likely advances in neuroscience will fundamentally alter our conceptions of human agency, of what it means to be a person, and of responsibility for action. I argue that neuroscience poses no such radical threat now and in the immediate future and it is unlikely ever to pose such a threat unless it or other sciences decisively resolve the mind-body problem. I suggest that until that happens, neuroscience might contribute to the reform of …

Poisoning The Next Apple? The America Invents Act And Individual Inventors, David S. Abrams, R. Polk Wagner

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The Leahy-Smith America Invents Act, the most significant patent law reform effort in two generations, has a dark side: It seems likely to decrease the patenting behavior of small inventors, a category which occupies special significance in American innovation history. In this paper we empirically predict the effects of the major change in the law: a shift in the patent priority rules from the United States’ traditional “first-to-invent” system to the predominant “first-to-file” system. While there has been some theoretical work on this topic, we use the Canadian experience with a similar change as a natural experiment to shed …

Extraterritorial Criminal Jurisdiction Under The Antitrust Laws, Herbert J. Hovenkamp

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The Ninth Circuit may soon consider whether challenges to antitrust activity that occurs abroad must invariably be addressed under the rule of reason, which will make criminal prosecution difficult or impossible.

When antitrust cases involve foreign conduct, the courts customarily appraise its substantive antitrust significance only after deciding whether the Sherman Act reaches the activity. Nevertheless, "jurisdictional" and "substantive" inquiries are not wholly independent. Both reflect two sound propositions: that Congress did not intend American antitrust law to rule the entire commercial world and that Congress knew that domestic economic circumstances often differ from those abroad where mechanical application of …

The Classical American State And The Regulation Of Morals, Herbert J. Hovenkamp

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The United States has a strong tradition of state regulation that stretches back to the Commonwealth ideal of Revolutionary times and grew steadily throughout the nineteenth century. But regulation also had more than its share of critics. A core principle of Jacksonian democracy was that too much regulation was for the benefit of special interests, mainly wealthier and propertied classes. The ratification of the Fourteenth Amendment after the Civil War provided the lever that laissez faire legal writers used to make a more coherent Constitutional case against increasing regulation. How much they actually succeeded has always been subject to dispute. …

Marketing And Outreach In Law Libraries: A White Paper, All-Sis Task Force On Library Marketing And Outreach, Amanda Runyon, Carol A. Watson, L. Cindy Dabney, Liz Mccurry Johnson, Emily Lawson, Shira Megerman, Jamie Sommer, T. J. Striepe, Michele Thomas

Librarian Scholarship at Penn Law

In recent years, libraries have turned to marketing and outreach to better educate library users about services and resources while gaining an understanding of their needs. Marketing and outreach are relatively new concepts in academic law libraries, and librarians tasked with these functions have found resources and examples of this type of work to be lacking. Though focused on academic law libraries, the article identifies the challenges facing all law libraries, explains why libraries need marketing and outreach plans, and provides examples of marketing and outreach successes.

Alexander's Genius, Mitchell N. Berman

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No abstract provided.

Rehabilitating Retributivism, Mitchell N. Berman

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This review essay of Victor Tadros’s new book, ‘‘The Ends of Harm: The Moral Foundations of Criminal Law,’’ responds to Tadros’s energetic and sophisticated attacks on retributivist justifications for criminal punishment. I argue, in a nutshell, that those attacks fail. In defending retributivism, however, I also sketch original views on two questions that retributivism must address but that many or most retributivists have skated past. First, what do wrongdoers deserve – to suffer? to be punished? something else? Second, what does it mean for them to deserve it? That is, what is the normative force or significance of valid desert …

They Were Meant For Each Other: Proffessor Edward Cooper And The Rules Enabling Act, Anthony J. Scirica, Mark R. Kravitz, David F. Levi, Lee H. Rosenthal

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No abstract provided.