Michael Mattioli ‘Patent Pool Outsiders’ (2018) 33 Berkeley Technology Law Journal 233

Patent pools reduce transaction costs that would otherwise persist whenever a product must rely on multiple patents. They address this problem by granting manufacturers and service providers permission to use the necessary patents through a single agreement. Licensees agree, in return, to pay standard royalty rates, which the pools divide among the patent holders. In this way, patent pools operate as cooperative licensing clearinghouses. By minimizing the number of licensing transactions that must take place for a product to be brought to the market, patent pools can significantly reduce transaction costs. These advantages are such that a growing number of economists and legal scholars are concerned that patent holders who refuse to join patent pools will undermine and sometimes entirely undo the benefits that patent pools deliver. If an important patent holder refused to join a patent pool and demanded greater royalties than it would otherwise receive as a member of that pool—i.e., supra-competitive prices—licensees would have to pay higher…

Jose Contreras and Peter Georg Pycht ‘Patent Assertion Entities and Legal Exceptionalism in the EU and the US’ (2017) Max Planck Institute for Innovation and Competition Research Paper no 17-11

This paper – which can be found here – identifies similarities and differences between Europe and the US regarding the role that patent assertion entities play in patent policy and patent litigation; and seeks to determine whether the law applicable to PAEs is substantively different from the law governing patent litigation more generally. As explained in previous posts, Patent Assertion Entities (PAEs) are firms that are in the business of patent monetization: they acquire patents from a variety of sources and then seek to collect revenue from companies manufacturing and selling products covered by those patents. More pejoratively, PAEs are known as patent “trolls”. Many commentators and policy makers have described PAE litigation as a phenomenon distinct from ordinary patent litigation. A number of studies suggest that a significant portion of recent U.S. patent litigation is attributable to PAEs, and that PAE activity is significant in Europe as well. One recent study found that PAEs accounted for approximately 19% of…

Herbert Hovenkamp ‘Reasonable Patent Exhaustion’ (2018) University of Pennsylvania Law School Faculty Scholarship. 1790

Exhaustion is a typical figure of IP and competition law (and, in the EU, of free movement law as well). The principle is relatively straightforward: after a certain point, restrictions on use or sale of a product cannot be enforced by someone who would otherwise have the right to enforce such restrictions. Exhaustion is often also called the first sale doctrine, as the right to object to the use or sale of a product usually ends after the product is sold for the first time. For example, when someone grants a patent license to another person, the exhaustion rule says that the patentee may not by impose conditions on the patented product’s subsequent use or sale, nor enforce these conditions through a patent infringement suit. This paper – which can be found here –  provides an analysis of a recent US Supreme Court’s decision: Impression Products, Inc. v. Lexmark International, Inc., 581 U.S. 1523 (2017). The case concerned a patent…

Christopher Buccafusco, Mark A. Lemley and Jonathan S. Masur ‘Intelligent Design’ (2017) Coase-Sandor Working Paper Series in Law and Economics 831

While this is a paper – which you can find here – is mainly on IP law, I circulate it because it highlights two matters relevant for competition practitioners: (i) how the regulation of topics other than competition can significantly affect competition – and competition law; (ii) how debates about the scope of individual competition law doctrines (e.g. abuse of IP rights, etc.) are often disguised debates about how to reform these regulatory frameworks. In other words, and as I noticed in previous posts, competition law operates in wider social and legal contexts that must be acknowledged. The argument of this paper is that when designers can obtain exclusive intellectual property (IP) rights in the functional aspects of their creations, they can wield these rights to increase both the costs their competitors incur and the prices that consumers must pay for their  goods. IP rights’ holders do this by using their rights in ways that do not promote the goals…

Saurabh Vishnubhakat ‘The Antitrusting of Patentability’ (2018) Seton Hall Law Review: Vol. 48 : Iss. 1 , Article 2

This paper, which can be found here,  focuses mainly on developments regarding IP patents in the US – in particular the adoption of per se rules by courts regarding the validity of patents. As such, my review will be quite succinct. The paper’s main argument is that the use of antitrust-style judicial shortcuts is not appropriate in patent law. The paper is structured as follows: It begins by comparing IP and antitrust law: ‘Both systems grapple with the jurisprudential tension, inherent in managing error costs, between legal standards and legal rules. Only antitrust law, however, has evolved a systematic approach to managing decision costs.’ The author argues that patent law has begun to borrow from competition law’s adoption of both form-based rules and detailed effects’ assessments by using the doctrine of patent-eligible subject matter as a shorthand for the more fact-intensive and costly doctrinal inquiries into whether an invention is truly patentable. To demonstrate this point, the paper engages in a…

Steven Andeman ‘Overplaying the Innovation Card: Stronger Intellectual Property Rights and Competition Law’ Kritika: Essays on intellectual property (ed.) Peter Drahos, Gustavo Ghidini, Hanns Ullrich (Elgar, 2015) 17-58

This paper is already over two years old, but it provides a good overview of the main challenges that arise at the intersection of competition and IP law. The article’s thesis is that patents and copyrights seek to promote innovation by striking a balance between protecting initial inventor rights, on the one hand, and fostering follow-on or cumulative innovation, on the other. It conceptualises recent efforts to use competition law to limit the scope of IP law as attempts to limit excessive protections granted to original inventors by IP rights to the detriment of follow-on innovation. Examples of such interventions in Europe include compulsory copyright licensing remedies, the sanctioning of certain attempts to manipulate the IP regime in order to extend the scope and duration of existing IP rights, the prohibition of pay-for delay agreements, and the use of competition law to limit reliance by Standard Essential Patent (SEP) holders on patent injunctions. The paper is structured as follows: Section…

Sainsbury’s Supermarkets Ltd v Visa Europe Services LLC & Anor [2017] EWHC 3047 (Comm)

This case – which can be found here – concerns multilateral interchange fees (‘MIF’) yet again. This is one of a number of cases where courts had to decide whether such fees were lawful (for examples, see the cases reviewed in my posts of 30 September 2016, 10 February and 24 March 2017). This one, Sainsbury’s v Visa, is a decision about the lawfulness of Visa’s scheme. The case was brought under the shadow of decisions by the European Commission and a number of courts holding that MasterCard’s MIF scheme was unlawful. In order to understand this case, it is important to first understand how the various credit card systems operate. There are two main credit card models: On the one hand we have three-party schemes, like the ones operated by American Express and Dinner’s Club. In a three-party scheme, the operator (such as American Express) both issues cards and settles transactions with merchants. In other words, when an American…

Walter Hugh Merricks CBE v Mastercard Incorporated and Others [2017] CAT 16

This judgment – which can be found here – concerns the first ever class certification request in an opt-out collective damages claim in the UK. I think this is a very important decision. Class or collective actions allow the aggregation of a large number of small claims for competition damages, and are likely to prove a crucial mechanism for customers seeking to obtain redress for loss caused by a competition infringement. Europe is not familiar with the type of class actions that are typical in North America, and the English courts – and particularly the CAT – are one of the first European courts (if not the first) to have to grapple with the challenges that such claims pose. One very important challenge is class certification, while another is the certification of the class representative. The first opt-out collective claim ever brought in the UK– i.e. Dorothy Gibson v Pride Mobility Products Limited [2017] CAT 9 – ended with the…

Renato Nazzini ‘Arbitrability of Competition Claims in Tort and the Principle of Effectiveness of EU Law’ (2017) European Business Law Review 28(6) 795

This paper – which can be found here – contains a discussion of the recent CDC decision by the Court of Justice of the European Union. It begins with  an overviews of debates about the arbitrability of competition law. Whether competition law matters are arbitrable is a question that is connected to a longstanding debate on the ‘public policy’ nature of competition law (which flows from the wording of the New York convention, but we do not need to go there now). It is widely accepted that while many matters may be subject to arbitration, difficulties arise where a dispute concerns a matter of public importance – such as criminal law or insolvency. For a long time, competition law matters were not allowed to be subject to arbitration on both sides of the Atlantic. In the 1980’s, the US Supreme Court reversed course and explicitly held that competition matters were arbitrable. In Europe, the arbitrability of competition law was implicitly…

Cento Veljanowski “Credit Cards, Counterfactuals, and Antitrust Damages” Journal of European Competition Law & Practice (2018) 9(3) 146–160

This paper – which can be found here – provides an overview of the UK MasterCard litigation. Mr. Veljanowski is likely very well placed to discuss this:  he was one of the two economic experts involved in a case recently decided by the CAT on the matter. He also seems to publish a paper about every court decision concerning the MasterCard litigation (see my post of 24 March 2017, regarding the Arcadia v MasterCard case). The paper begins with a quick overview of the MasterCard litigation. As a result of the European Commission’s MasterCard decision, there are currently about 25 separate standalone and follow-on retailer actions making their way through the English courts concerning MasterCard and Visa’s card systems’ interchange fees. The first decision in these cases was adopted by the CAT last year (Sainsbury v MasterCard). The second one was the Arcadia v MasterCard case I posted about on 10 February. There are also more recent decisions by the…