Monday, March 10, 2014

Some Recent Scholarship on Patent Remedies

1.  Ted Sichelman's paper Purging Patent Law of 'Private Law' Remedies has now been published in 92 Texas Law Review 517 (2014), available here.  Here is the abstract:
In this Article, Professor Sichelman rejects the fundamental “private law” premise of patent law remedies that courts should always attempt to make the patentee “whole” in the event of infringement because the overarching aim of patent law is to promote innovation, not to remedy private wrongs.  Specifically, make-whole damages may thwart optimal innovation incentives when they concern small components of complex products involving high-switching costs, generate large consumer deadweight losses, result in substantial duplicated costs during the pre-invention R&D process, or create transaction costs far in excess of the value of the invention.  In other situations, a patentee should be made more than whole.  For example, inducing socially valuable innovations that do not command large profits in the private market—such as drugs for rare diseases and technologies for the disabled—may require more than make-whole compensation.
More generally, Professor Sichelman argues that the statutory remedies provisions of the Patent Act rest on a flawed foundation.  Instead of correcting for private wrongs inflicted on private parties, patent law remedies should be tailored simply to promote the types and levels of innovation that most benefit society, taking into account administrative and error costs.  As such, Professor Sichelman proposes that the patent system and its associated remedies should be viewed as part of a public regulatory regime designed to further societal goals rather than a private law system that protects individual interests.
The online companion to the Texas Law Review, called "Texas Law Review See Also," provides commentary on the paper by Dan Burk and by me.  An earlier draft of my commentary, which I blogged about here, is available here.

2.  The final version of my essay Reining in Patent Remedies:  Three (Increasingly Immodest) Proposals also is now out, in 30 Santa Clara Computer & High Technology Law Journal 1 (2013) (available here).  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 Section 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.
3.  A couple of student papers on patent remedies that I supervised have now been published as well.  One is Jaimeson Fedell's A Step in the Right Direction:  Patent Damages and the Elimination of the Entire Market Value Rule, 98 Minnesota Law Review 1143 (2014), available here.  The other is George David Kidd's Accuracy or Efficiency:  Has Grain Processing Made a Difference?, 15 Minnesota Journal of Law, Science & Technology 653 (2014).

4. Samuel Bray's paper The Myth of the Mild Declaratory Judgment has been published in volume 63 of the Duke Law Journal, available here.  I blogged about an earlier draft of this paper in November, here.  At that time, I described the paper as making some persuasive points about the relationship between declaratory judgments and injunctions, while also noting that I found a few of the things the author said about declaratory judgments involving patents questionable.  The final version of the paper responds to some of these latter points, and overall (as I said before) the paper is definitely worth a read.

5.  I'd also like to call attention to a blog I discovered only last week, Patent Damages.  The blog is maintained by Chris Marchese and Justin Barnes of Fish & Richardson, and the blog appears to concentrate on U.S. patent damages cases.  I've added it to my list "Other Blogs of Interest" in the left-hand column of this page, and will be consulting it regularly.

6.  As reported on IPKat, over at the Journal of Intellectual Property Law and Practice (JIPLP) Blog Darren Smyth has a write-up on the Patents Court (Eng. & Wales) decision on springboard injunctions in Smith & Nephew Plc v. Convatec Technologies Inc., [2013] EWHC 3955.  I blogged about this decision in January, here, noting among other things that the springboard injunction does not appear to be a viable option under U.S. law.

7.  Last but not least, I came across a few other interesting announcements recently.  One is for a book published in 2011, Robert Resis's Preliminary Relief in Patent Infringement DisputesThe publisher is the Intellectual Property Law Section of the American Bar Association and the relevant information can be found here.  Another is for a book titled Criminal Enforcement of Intellectual Property: A Handbook of Contemporary Research (Christophe Geigner ed., Edward Elgar 2012); information available here.  In addition, I discovered a service called Docket Navigator that publishes U.S. patent litigation statistics; website here.  I noticed that this service reports 6,020 new U.S. district court patent cases in 2012, which is higher than the figure (5,189) reported by PriceWatershouseCooper in its report for 2013, available here.  There must be some differences in methodology; Docket Navigator states that "Transferred, consolidated, coordinated, or bifurcated actions may contribute to the number of cases counted."     

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