Sunday, July 28, 2013

Some new papers of mine on patent remedies

Professor Ted Sichelman will be publishing a paper in a forthcoming issue of the Texas Law Review titled "Purging Patent Law of ‘Private Law’ Remedies".  The review solicited a response from me in its online supplement, "Texas Law Review See Also."  I don't think that a current version of the Sichelman paper is available on ssrn (though I assume the print version will be out very soon), but my short response--titled "Make No Little Plans: Response to Ted Sichelman, Purging Patent Law of ‘Private Law’ Remedies"--is available on ssrn, here.  Here is the abstract of my response:
This essay responds to Professor's Ted Sichelman's forthcoming article, Purging Patent Law of "Private Law" Remedies, 91 Tex. L. Rev. __ (2013), which argues that courts should abandon the conventional view of patents as private rights for which private-law remedies are appropriate, and instead should award damages and injunctions only when, and to the extent that, doing so serves the public interest for which patents are granted in the first place. Although some of Sichelman’s specific recommendations are well within the mainstream of contemporary patent scholarship, in particular some of his recommendations relating to permanent injunctions and enhanced damages, he also argues that courts should award monetary relief for patent infringement so as to align ex ante incentives with ex post rewards; this could mean awarding either more or less than would be necessary to restore the patentee to the position it would have occupied but for the infringement (the traditional benchmark for compensatory damages). Although I remain skeptical that such a system could ever work in the real world, Sichelman defends his thesis with aplomb – and recognizes its practical infeasibility in the near term. In addition, his analysis suggests that at least in industries in which patents are unlikely to play a major role in inducing invention, disclosure, or commercialization, efforts to ensure that defendants restore patentees to the position they would have occupied, but for the infringement, may not be worth the candle; some risk of undercompensation may be more tolerable than is commonly assumed. I will suggest that this implication, if valid, possibly could have some practical payoff even in the short run.
I also posted an undated version of a symposium piece that will be coming out in the Santa Clara Computer & High Technology Law Journal, here.  (The updates are pretty modest, so if you've read the previous version there's probably no good great urgency to reading this version.)  Here is the abstract:
           This essay, which builds on my recent work on the law and economics of comparative patent remedies, presents three proposals relating to the enforcement of domestic patent rights. The first, which may be close to being adopted in the United States, is for the courts and the International Trade Commission (ITC) to adopt a general presumption, grounded in patent law and policy, that patent owners who have committed to license their standard essential patents (SEPs) on fair, reasonable, and nondiscriminatory terms are not entitled to permanent injunctions or exclusion orders, but rather only to a damages in the form of an ongoing royalty calculated on the basis of what a reasonable licensor and licensee would have agreed to prior to the adoption of the standard in question. Countries such as Germany that have addressed the issue of remedies for the infringement of SEPs within the context of competition law, while otherwise leaving in place an almost-automatic entitlement to permanent injunctive relief, have in my view taken the wrong tack. Second, I argue that Congress should amend Patent Act § 289, which permits design patent owners to recover the infringer’s profits, so as to require that such awards reflect only the profit derived from the use of the infringed design (and not the entire product of which the design is a part). Such apportionment is the norm in other countries (and in U.S. copyright and trademark law). By contrast, the archaic U.S. design patent rule threatens substantial overdeterrence and overcompensation, as reflected in the recent jury award in Apple v. Samsung. My third suggestion — really more of a thought experiment inspired by Judge Posner’s opinion in Apple v. Motorola than a serious proposal for reform — is to consider whether it would be possible to eliminate the unique U.S. practice of trial by jury in a wide swath of U.S. patent cases by statutorily recasting awards of reasonable royalties as a form of equitable restitution rather than as compensation.

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