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The Actavis Inference: Theory And Practice, Aaron S. Edlin, C. Scott Hemphill, Herbert J. Hovenkamp, Carl Shapiro
The Actavis Inference: Theory And Practice, Aaron S. Edlin, C. Scott Hemphill, Herbert J. Hovenkamp, Carl Shapiro
All Faculty Scholarship
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 …
Promoting Innovation, Matthew Sag, Spencer Weber Waller
Promoting Innovation, Matthew Sag, Spencer Weber Waller
Faculty Articles
This Essay proceeds as follows. We briefly introduce the concept of creative destruction and its place in Schumpeter’s work in Part II. In Part III we explain why a truly Schumpeterian competition policy demands more than a laissez faire approach. We explain why the law must preserve opportunities and incentives for creative destruction at all stages of innovation and we review four key policy areas of antitrust law from this innovation-focused perspective: unilateral conduct cases (Part III.A), cases at the intersection of IP and antitrust (Part III.B), Sherman Act section 1 cases (Part III.C), and merger policy (Part III.D). In …
Antitrust And The Patent System: A Reexamination, Herbert J. Hovenkamp
Antitrust And The Patent System: A Reexamination, Herbert J. Hovenkamp
All Faculty Scholarship
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 patents 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, however, then …
Living With Monsanto, 2015 Mich. St. L. Rev. 559 (2015), Daryl Lim
Living With Monsanto, 2015 Mich. St. L. Rev. 559 (2015), Daryl Lim
Faculty Scholarly Works
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, Daryl Lim
Living With Monsanto, Daryl Lim
Faculty Scholarly Works
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 …
Brulotte'S Web, Herbert J. Hovenkamp
Brulotte'S Web, Herbert J. Hovenkamp
All Faculty Scholarship
Kimble v. Marvel Entertainment held that stare decisis required the Supreme Court to adhere to the half century old, much criticized rule in Brulotte v. Thys. Justice Douglas' Brulotte opinion concluded that license agreements requiring royalties measured by use of a patent after its expiration are unenforceable per se. The court need not inquire into market power nor anticompetitive effects, effects on innovation, and it may not accept any defense. Congress can change the rule if it wants to, but has resisted many invitations to do so.
Under Brulotte a hybrid license on patents and trade secrets requires a royalty …
The Rule Of Reason And The Scope Of The Patent, Herbert J. Hovenkamp
The Rule Of Reason And The Scope Of The Patent, Herbert J. Hovenkamp
All Faculty Scholarship
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 to characterize activities as lawful if they do not extend beyond the patent's scope. In the first half of the twentieth century the …