[PDF] Property Rules Vs Liability Rules For Patent Infringement eBook

Author : Carl Shapiro
Publisher :
Page : 0 pages
File Size : 44,16 MB
Release : 2016
Category :
ISBN :

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When a patent has been infringed, the court can impose a forward-looking remedy based on a property rule or based on a liability rule. Under the property rule, the court issues an injunction ordering the infringing party to stop infringing. Under the liability rule, the court allows the infringing party to continue to infringe the patent in question so long as it pays specified ongoing royalties to the patent holder. Since the Supreme Court's landmark 2006 decision in the eBay case, the United States has employed a hybrid system: the lower courts have discretion, on a case-by-case basis, to issue an injunction or to establish ongoing royalties. This article develops a simple model, including the possibility of patent holdup, in which the court has an imperfect ability to measure the harm to the patent holder caused by ongoing infringement. In the model, the patent holder and the infringing firm can negotiate efficiently over a patent license following the court's imposition of a remedy, subject to some antitrust limits. Remedy regimes are evaluated based on how close they come, in expected value, to compensating the patent holder for any ongoing infringement. The model identifies a fundamental tradeoff: ongoing royalties perform better, the greater are the switching costs the infringing firm would bear to redesign its product to avoid infringing, but an injunction performs better, the greater is the court's uncertainty about the harm that ongoing infringement will cause to the patent holder. Based on this analysis, recommendations regarding prospective patent remedies are offered to the courts.

Author : Daniel Krauspenhaar
Publisher : Springer
Page : 251 pages
File Size : 40,24 MB
Release : 2014-10-06
Category : Law
ISBN : 3642409008

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The primary purpose of a patent law system should be to enhance economic efficiency, in particular by providing incentives for making inventions. The conventional wisdom is that patents should therefore be strictly exclusive rights. Moreover, in practice patent owners are almost never forced to give up their right to exclude others and receive only a certain amount of remuneration with, for instance, compulsory licensing. Other economically interesting patent-law objectives, however, include the transfer and dissemination of knowledge. Mechanisms exist by which the patent owner decides if he or she would prefer exclusive or non-exclusive rights, for instance the opportunity to declare the willingness to license and create patent pools. But it is questionable whether these mechanisms are sufficient and efficient enough in view of the existence of patent trolls and other problems. This work challenges the conventional wisdom to a certain extent and makes proposals for improvements.

Author : BJ Ard
Publisher :
Page : 0 pages
File Size : 14,95 MB
Release : 2019
Category :
ISBN :

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Patent and copyright rely heavily on property rules rather than liability rules: in the event of infringement, courts impose injunctive relief or punitive damages rather than compensatory damages. While this scheme is intended to protect creators' ex ante incentives to engage in intellectual production, the regime raises many problems for the creation and distribution of new works. In particular, it imposes unjustified costs on unwitting infringers and exacerbates the difficulty of coordinating among multiple parties to pursue projects that implicate several IP rights. Both problems could be ameliorated by strategic deployment of liability rules. The law of tangible property demonstrates how this strategy might work. While we often assume that the law protects tangible property with property rules, closer scrutiny shows that courts and lawmakers use liability rules to deal with unintentional trespasses and to circumvent holdout strategies that implicate real property.This analysis yields three payoffs. First, it develops the novel and counterintuitive argument that IP uses property rules in many circumstances where property law uses liability rules. This arrangement is backwards because the greater notice failures, inexhaustibility, and need for cumulative production inherent to our IP regimes relative to tangible property counsel in favor of liability rules. Second, it grounds the debate over the use of property rules versus liability rules in IP in tangible property doctrine, where courts and lawmakers have taken the pragmatic approach of structuring entitlements to facilitate economic progress. Finally, it identifies three ways the choice of remedies could serve as a concrete policy lever to address issues in IP: (1) We can correct notice failures by creating a “reasonable search defense” -- eliminating property rule protection in cases of accidental infringement -- to encourage users to search and owners to publicize their claims; (2) we can defuse holdout strategies by rejecting property rule protection for IP owners who refuse to bargain in good faith; and (3) the state can actively cut through patent thickets and similar anti-commons by utilizing -- or threatening to use -- its march-in rights and authority to enact compulsory licenses.

Author : Terence P. Ross
Publisher : Law Journal Press
Page : 970 pages
File Size : 44,87 MB
Release : 2000
Category : Law
ISBN : 9781588520944

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This book addresses two crucial concerns of intellectual property owners--how to recover monetary compensation when an infringement has occurred and how to prevent further infringement.

Author : Rosa Castro Bernieri
Publisher : European Studies in Law and Economics
Page : 0 pages
File Size : 50,42 MB
Release : 2010
Category : Aansprakelijkheid / gtt
ISBN : 9789400001053

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This book examines alternative ways of protecting patent rights using the law and economics framework of property and liability rules. Traditional compulsory licenses are compared with the most recent discussions on the choice between granting or denying injunctive relief for patents (ex post liability rules). The debate about strategic behavior triggered by the patent system, especially in the aftermath of the US Supreme Court decision in eBay v. MercExchange is discussed, along with policy perspectives on both sides of the Atlantic. The problem of calculating the level of compensation, which is one of the most important critiques against the use of liability rules in patent law, is also examined in depth. The book concludes by suggesting that a coherent patent system could opt for property rules in general cases, while leaving enough space for exceptions and limited liability rules. Curtailing exceptions and limitations to patent rights, including the use of patent liability rules, could otherwise risk stifling innovation and even contradicting the goals of patent law.

Author : Christopher M. Newman
Publisher :
Page : 0 pages
File Size : 23,10 MB
Release : 2014
Category :
ISBN :

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When should we grant injunctions against infringers of intellectual property? Before the Supreme Court's decision in eBay v. MercExchange, the presumptive answer used to be always, on the grounds that property consists of a right to exclude, and infringement - like trespass - is a direct negation of that right. As property scholars Richard Epstein and Henry Smith have argued, this traditional dominance of property rules serves important purposes, reducing information costs and preventing the systematic undercompensation of rightsholders endemic to a liability rule regime. Nevertheless, there are other common law doctrines - notably accession and nuisance - that sometimes countenance use of liability rules to rescue from holdout certain investors who create value without securing in advance all the property rights needed to realize it. Withholding injunctive relief for nuisance - as Epstein urges we do when there is a large disparity of value between the spillover-creating activity and the damaged one - is tantamount to allowing the acquisition of non-possessory use privileges via accession. This article seeks to explain why these limited departures from strict property rules make sense in the realm of tangible property, and argues that those reasons are particularly salient in the realm of IP. The key insight is that sometimes information as to what property rights will be needed by a productive enterprise can only be generated by making the sorts of investments that give rise to holdout. Moreover, the arguments for applying strict property rules to IP overlook the fact that doing so creates the very sort of liability rule regime with regard to tangible property that Epstein and Smith warn against. While this analysis justifies the denial of injunctive relief in some cases of holdout however, there is an important caveat. Accession doctrine only justifies the use of liability rules where there is great disparity in value, and IP rights lack the sort of fungibility that facilitates such a comparison. Where a patent has been licensed only exclusively or not at all, injunctions may remain the only way to protect entrepreneurial value.

Author : He Yudong
Publisher :
Page : 0 pages
File Size : 28,39 MB
Release : 2015
Category :
ISBN :

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Based on the dichotomy of the property rule and the liability rule for property rights protection in perspective of Law and Economics, this article proposes that the normative standard of remedies for patent infringement should be in between the two extremes, which might be called “relative property rule”. The original level of specific patent remedy rules, such as lost profits, illicit profits, royalty, etc., in short of legislative or judicial adjustments is much likely to deviate from the normative standard. The U.S. courts grant injunctions according to principles of equity and adjust the damages award actively in order to make the patent remedial level in line with the relative property rule. In comparison, the patent remedial level of China does not conform to the relative property rule in some aspects. The main body of this article is a comparison of remedy rules between the U.S. and China, and will demonstrate that the lost profits damages in China are obviously lower than that of the U.S., but contrary to popular impression, injunctive remedy in China is in a higher level.

Author : Rosa Castro
Publisher :
Page : 358 pages
File Size : 32,8 MB
Release : 2016
Category :
ISBN :

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This book examines alternative ways of protecting patent rights using the law and economics framework of property and liability rules. Traditional compulsory licenses are compared with the most recent discussions on the choice between granting or denying injunctive relief for patents (ex post liability rules). The debate about strategic behaviour triggered by the patent system, especially in the aftermath of the U.S. Supreme Court decision in eBay v. MercExchange is discussed along with policy perspectives on both sides of the Atlantic. The problem of calculating the level of compensation, which is one of the most important critiques against the use of liability rules in patent law, is also examined in depth. The book concludes by suggesting that a coherent patent system could opt for property rules in general cases while leaving enough space for exceptions and limited liability rules. Curtailing exceptions and limitations to patent rights, including the use of patent liability rules, could otherwise risk stifling innovation and even contradicting the goals of patent law.

Author : Jae Hun Park
Publisher : Edward Elgar Publishing
Page : 253 pages
File Size : 39,73 MB
Release : 2010-01-01
Category : Law
ISBN : 1849805482

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Dr Jae Park is to be congratulated for turning our attention to this difficult and underexplored area. His work focuses on standards and patents but goes well beyond an initial first analysis. He examines the finer points of both sets of rules in order to find out exactly where the problem lies and he then looks at the existing mechanisms that could provide a solution. Many of these have their roots in the area of competition law, but his thorough analysis shows that competition law in its current form and with its current limitations is not the perfect tool to address the problems that arise when patented technology becomes the object of standardisation. This leads Dr Park to develop his own solution for the problem at hand: a solution which he finds in the dynamic liability rules regime. This book really breaks new ground and provides a first and thorough analysis of this rarely addressed but increasingly important area. From the foreword by Paul L.C. Torremans, University of Nottingham, UK This insightful book reviews the inherent conflict between patent rights and industry standards and through analysis of both US and European case law proposes measures to improve current systems and foster greater innovation. Jae Hun Park searches for the appropriate balance between the rights of patent owners and the need for industry standards within the scope of patent law. He considers the current solutions provided by legal systems and using cost benefit analysis evaluates, from a legal and economic perspective, whether patent systems can be improved. Jae Hun Park proposes reform to the patent system that would introduce a dynamic liability rule regime , rather than property rules . The dynamic liability rule regime adopts property rules at the stage when there are still competing standards, and liability rules at the stage when there are no competing standards. This would, he argues, resolve the conflict between patents and standards and mitigate the patent hold-up problem. This is a must-read book for scholars interested in technology patents, innovation and competition law and policy, as well as those individuals working in standard setting organisations. It will also be of great interest to patent offices, patent attorneys and competition lawyers.

Author : Jonathan S. Masur
Publisher :
Page : 21 pages
File Size : 39,68 MB
Release : 2011
Category : Liability (Law)
ISBN :

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Patent law's infringement doctrines, commonly understood to be simply rules of liability, are in fact search rules as well. Patent liability rules determine not only who will be responsible for what conduct, but also when patent holders and potential infringers will benefit from locating (or remaining ignorant of) one another. They thus affect the conditions under which parties will have incentives to engage in search. The dynamics of patent search are actually quite complicated. Under normal circumstances, patent law's liability rules generate approximately optimal investments in search as both patent holders and possible infringers have incentives to locate one another. But when a direct infringer is insolvent or unreachable, the fact that contributory infringers can be held liable only when they have knowledge of the patent shifts search responsibilities toward patent holders. Search incentives are also affected by patent law's rules regarding past conduct and by the possibility of holdup problems based on alleged infringers' product-specific investments. This Article demonstrates that patent law's liability rules may be generating inefficient levels of search and corresponding social welfare losses and proposes a simple doctrinal corrective.