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 discussion of the trade-off between error costs in individual cases and decisions costs in the long run in the context of the debate of standards and rules (i.e. decision theory). This analysis evolves along the same lines as – but in less detail than – our background note on Legal Rules and Presumptions, so I’ll not repeat it here.
A second section describes how judicial assessments of patent validity increasingly follow the antitrust approach – i.e. courts have developed bright-line rules that purport to provide shortcuts to detailed factual analysis in IP law – with the objective of minimising decision costs. The author argues that such an approach is ill-suited for IP law, which lacks the doctrinal underpinnings that antitrust analysis relies on. Since we are all familiar with the doctrinal underpinnings of antitrust analysis, and the discussion is quite IP specific, I do not think I should summarise it in detail here.
The third section advances a proposal for filling the doctrinal gaps in IP law created by the adoption of simplified rules – broadly speaking, it suggests that IP authorities should engage in additional fact-finding. Naturally, this starts from the assumption that decision costs incurred by individual parties and IP authorities are significantly lower than the error costs of mistakenly granting IP rights.
This paper is interesting because it contains a good discussion of the similarities between IP and competition law – and provides an example of how competition law can influence the development of IP law. The paper also contains a rather good, if succinct analysis of decision-theory – i.e. a rule-design theory that is often relied on when discussing the ideal scope of competition law rules. The discussion is quite mainstream but provides a good overview of how the same principles apply to both antitrust and IP law. Ul
timately, the originality of this paper lies in how it uses the traditional analysis of trade-offs between strict rules and detailed economic analysis in the antitrust context in an attempt to explain and criticise recent developments regarding the assessment of patent validity in the US.