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It has long been recognized in Europe and elsewhere that standards-development organizations (SDOs) may adopt policies that require their participants to license patents essential to the SDO’s standards (standards-essential patents or SEPs) to manufacturers of standardized products (“implementers”) on a royalty-free (RF) basis. This requirement contrasts with SDO policies that permit SEP holders to charge implementers monetary patent royalties, sometimes on terms that are specified as “fair, reasonable and nondiscriminatory” (FRAND). As demonstrated by two decades of intensive litigation around the world, FRAND royalties have given rise to intractable disputes regarding the manner in which such royalties should be calculated and adjudicated. In contrast, standards distributed on an RF basis are comparatively free from litigation and the attendant transaction costs. Accordingly, numerous SDOs around the world have adopted RF licensing policies and many widely adopted standards, including Bluetooth, USB, IPv6, HTTP, HTML and XML, are distributed on an RF basis. This note briefly discusses the commercial considerations surrounding RF standards, the relationship between RF standards and open source software (OSS) and the SDO policy mechanisms – including “universal reciprocity” -- that enable RF licensing to succeed in the marketplace.

Existing foundation models are trained on copyrighted material. Deploying these models can pose both legal and ethical risks when data creators fail to receive appropriate attribution or compensation. In the United States and several other countries, copyrighted content may be used to build foundation models without incurring liability due to the fair use doctrine. However, there is a caveat: If the model produces output that is similar to copyrighted data, particularly in scenarios that affect the market of that data, fair use may no longer apply to the output of the model. In this work, we emphasize that fair use is not guaranteed, and additional work may be necessary to keep model development and deployment squarely in the realm of fair use. First, we survey the potential risks of developing and deploying foundation models based on copyrighted content. We review relevant U.S. case law, drawing parallels to existing and potential applications for generating text, source code, and visual art. Experiments confirm that popular foundation models can generate content considerably similar to copyrighted material. Second, we discuss technical mitigations that can help foundation models stay in line with fair use. We argue that more research is needed to align mitigation strategies with the current state of the law. Lastly, we suggest that the law and technical mitigations should co-evolve. For example, coupled with other policy mechanisms, the law could more explicitly consider safe harbors when strong technical tools are used to mitigate infringement harms. This co-evolution may help strike a balance between intellectual property and innovation, which speaks to the original goal of fair use. But we emphasize that the strategies we describe here are not a panacea and more work is needed to develop policies that address the potential harms of foundation models.

This report presents the takeaways of the inaugural Workshop on Generative AI and Law (GenLaw), held in July 2023. A cross-disciplinary group of practitioners and scholars from computer science and law convened to discuss the technical, doctrinal, and policy challenges presented by law for Generative AI, and by Generative AI for law, with an emphasis on U.S. law in particular. We begin the report with a high-level statement about why Generative AI is both immensely significant and immensely challenging for law. To meet these challenges, we conclude that there is an essential need for 1) a shared knowledge base that provides a common conceptual language for experts across disciplines; 2) clarification of the distinctive technical capabilities of generative-AI systems, as compared and contrasted to other computer and AI systems; 3) a logical taxonomy of the legal issues these systems raise; and, 4) a concrete research agenda to promote collaboration and knowledge-sharing on emerging issues at the intersection of Generative AI and law. In this report, we synthesize the key takeaways from the GenLaw workshop that begin to address these needs. All of the listed authors contributed to the workshop upon which this report is based, but they and their organizations do not necessarily endorse all of the specific claims in this report.

Is the output of generative AI entitled to First Amendment protection? We're inclined to say yes. Even though current AI programs are of course not people and do not themselves have constitutional rights, their speech may potentially be protected because of the rights of the programs' creators. But beyond that, and likely more significantly, AI programs' speech should be protected because of the rights of their users-both the users' rights to listen and their rights to speak. In this short Article, we sketch the outlines of this analysis., Comment: Published in the Journal of Free Speech Law (2023)

Generative AI, in particular text-based "foundation models" (large models trained on a huge variety of information including the internet), can generate speech that could be problematic under a wide range of liability regimes. Machine learning practitioners regularly "red team" models to identify and mitigate such problematic speech: from "hallucinations" falsely accusing people of serious misconduct to recipes for constructing an atomic bomb. A key question is whether these red-teamed behaviors actually present any liability risk for model creators and deployers under U.S. law, incentivizing investments in safety mechanisms. We examine three liability regimes, tying them to common examples of red-teamed model behaviors: defamation, speech integral to criminal conduct, and wrongful death. We find that any Section 230 immunity analysis or downstream liability analysis is intimately wrapped up in the technical details of algorithm design. And there are many roadblocks to truly finding models (and their associated parties) liable for generated speech. We argue that AI should not be categorically immune from liability in these scenarios and that as courts grapple with the already fine-grained complexities of platform algorithms, the technical details of generative AI loom above with thornier questions. Courts and policymakers should think carefully about what technical design incentives they create as they evaluate these issues., Comment: Published in the Journal of Free Speech Law (2023)

It has long been recognized in Europe and elsewhere that standards-development organizations (SDOs) may adopt policies that require their participants to license patents essential to the SDO’s standards (standards-essential patents or SEPs) to manufacturers of standardized products (“implementers”) on a royalty-free (RF) basis.1 This requirement contrasts with SDO policies that permit SEP holders to charge implementers monetary patent royalties, sometimes on terms that are specified as “fair, reasonable and nondiscriminatory” (FRAND). As demonstrated by two decades of intensive litigation around the world, FRAND royalties have given rise to intractable disputes regarding the manner in which such royalties should be calculated and adjudicated. In contrast, standards distributed on an RF basis are comparatively free from litigation and the attendant transaction costs.2 Accordingly, numerous SDOs around the world have adopted RF licensing policies and many widely adopted standards, including Bluetooth, USB, IPv6, HTTP, HTML and XML, are distributed on an RF basis. This note briefly discusses the commercial considerations surrounding RF standards, the relationship between RF standards and open source software (OSS) and the SDO policy mechanisms – including “universal reciprocity” -- that enable RF licensing to succeed in the marketplace.

This ground-breaking and timely contribution is the first and most comprehensive edited collection to address the implications for Intellectual Property (IP) law in the context of 3D Printing and Additive Manufacturing. Providing a coverage of IP law in three main jurisdictions including the UK, USA and Australia. 3D Printing and Beyond brings together a team of distinguished IP experts and is an indispensable starting point for researchers with an interest in IP, emerging technologies and 3D printing.

On 23 November 2017, the European Parliament, published a Working Document titled Three-Dimensional Printing, a Challenge in the fields of Intellectual Property Rights and Civil Liability. The publication went on to state that the European Commission ‘has made 3D printing one of the priority areas of technology’. The technology was also referred to in the European Commission’s recent reflection paper on ‘harnessing globalisation’ stating that 3D printing, amongst other emerging technologies, ‘will revolutionise how we produce, work, move and consume’ (emphasis added). In April 2018, the European Commission demonstrated its commitment to exploring the intellectual property implications of industrial three-dimensional printing by commissioning research in to this area, in a move to shape policy. In a further publication titled, The Next Production Revolution: Implications for Governments and Businesses, it was emphasised that ‘long-term thinking is essential’ for technologies such as 3D printing. The report went on to say that ‘in addition to addressing short-term challenges, leaders in business, education, unions and government must be ready to frame policies’ and reflect on ‘how policy priorities may need to evolve, in fields as diverse as the intellectual property system, competition and trade policies, and the distributional implications of future production’. As such, 3D printing, presents various challenges for the legal, ethical , medical and health and safety sectors. Amongst these various concerns, the report makes reference to the impact of 3D printing on intellectual property rights (IPRs). The imminent change and the need for responsive policy, particularly in the area of IPRs has been acknowledged and echoed in a number of countries, including the United Kingdom (UK), the United States of America (USA) and Australia – the jurisdictions which are the focus of this book. This introductory chapter is set out as follows. It commences with a brief introduction

In a 2006 short story, ‘Printcrime’, Cory Doctorow imagined a dystopian future of contraband 3D printers. In the work, police try to shut down a bootleg operation, which engaged in the 3D printing of intellectual property. In his 2009 novel Makers, Cory Doctorow explored the rise of the maker community, and its do-it-yourself ethic. In an interview about the novel, the author reflected: "There has never been a better time to be a maker because finding the people who know how to fix the thing that's broken has never been easier. Finding someone else who has done 80% of what you want to do, and sharing the things you have done with other people, has never been easier. A maker is someone who is of and in the 21st century." Rather prophetically, he discussed the prospect of intellectual property conflicts around 3D printing (particularly around copyright infringement and trademark infringement), and future controversies over 3D printing guns. In his 2015 short story, ‘The Man Who Sold the Moon’, Cory Doctorow imagined 3D printing in space. This body of creative work has been an important inspiration for the Maker Movement – but it has also shown a critical engagement with the law, ethics, and public policy associated with 3D printing and additive manufacturing. Inspired by such science fiction, there have since been a number of optimistic, utopian manifestos published on the topic of 3D printing and the rise of the Maker Movement. There has been high hopes that the emerging, disruptive technology will be part of a new industrial revolution. The founder and executive chairman of the World Economic Forum, Klaus Schwab, situates 3D printing within the framework of a fourth industrial revolution. He predicted: ‘As current size, cost and speed constraints are progressively overcome, 3D printing will become more pervasive to include integrated electronic components such as circuit boards and even human cells and organs.’ Schwab anticipated that there would be a ‘new g

In this paper, we show that there are important differences across patent examiners at the U.S. Patent and Trademark Office (USPTO), and that these relate to the most important decision made by the USPTO: whether or not to grant a patent. We find that more experienced examiners, and those who systematically cite less prior art, are more likely to grant patent applications. These results are not encouraging as a matter of public policy. But they do point to human resource policies as potentially important levers in patent system reform. (JEL Keywords: O34 - Intellectual Property Rights; O38 - Government Policy)

In this paper, we show that there are important differences across patent examiners at the U.S. Patent and Trademark Office (USPTO), and that these relate to the most important decision made by the USPTO: whether or not to grant a patent. We find that more experienced examiners, and those who systematically cite less prior art, are more likely to grant patent applications. These results are not encouraging as a matter of public policy. But they do point to human resource policies as potentially important levers in patent system reform. (JEL Keywords: O34 - Intellectual Property Rights; O38 - Government Policy)

We study several interconnected problems that arise under the current U.S. patent system when a patent covers one component or feature of a complex product. This situation is common in the information technology sector of the economy. Our analysis applies to cases involving reasonable royalties, but not lost profits. First, we show using bargaining theory that the threat to obtain a permanent injunction greatly enhances the patent holder’s negotiating power, leading to royalty rates that exceed a natural benchmark range based on the value of the patented technology and the strength of the patent. Such royalty overcharges are especially great for weak patents covering a minor feature of a product with a sizeable price/cost margin, including products sold by firms that themselves have made substantial R&D investments. These royalty overcharges do not disappear even if the allegedly infringing firm is fully aware of the patent when it initially designs its product. However, the hold-up problems caused by the threat of injunctions are reduced if courts regularly grant stays to permanent injunctions to give defendants time to redesign their products to avoid infringement when this is possible. Second, we show how hold-up problems are magnified in the presence of royalty stacking, i.e., when multiple patents read on a single product. Third, using third-generation cellular telephones and Wi-Fi as leading examples, we illustrate that royalty stacking can become a very serious problem, especially in the standard-setting context where hundreds or even thousands of patents can read on a single product standard. Fourth, we discuss the use of “reasonable royalties” to award damages in patent infringement cases. We report empirical results regarding the measurement of “reasonable royalties” by the courts and identify various practical problems that tend to lead courts to over-estimate “reasonable royalties” in the presence of royalty stacking. Finally, we make suggestions for

A central fact about the information technology sector is the multiplicity of patents that innovators must deal with. Indeed, hundreds of thousands of patents cover semiconductor, software, telecommunications, and Internet inventions. Because of the nature of information technology, innovation often requires the combination of a number of different patents. Currently, various features of the patent system facilitate holdup, particularly in the standard-setting context. These features include insufficient discounting in damages for patent infringement and the resultant inflated demands for royalties, the low standard of proof for willful infringement, which allows patentees to recover treble damages, and the threat of injunctive relief. Frequently, innovators make irreversible investments in their development of new technology, only to have those investments used against them as a bargaining chip by existing patent holders. This Article suggests five steps that standardsetting organizations may take to reduce the problem of patent holdup and five ways the law should change to deal with the problem.

We study several interconnected problems that arise under the current U.S. patent system when a patent covers one component or feature of a complex product. This situation is common in the information technology sector of the economy. Our analysis applies to cases involving reasonable royalties, but not lost profits. First, we show using bargaining theory that the threat to obtain a permanent injunction greatly enhances the patent holder’s negotiating power, leading to royalty rates that exceed a natural benchmark range based on the value of the patented technology and the strength of the patent. Such royalty overcharges are especially great for weak patents covering a minor feature of a product with a sizeable price/cost margin, including products sold by firms that themselves have made substantial R&D investments. These royalty overcharges do not disappear even if the allegedly infringing firm is fully aware of the patent when it initially designs its product. However, the hold-up problems caused by the threat of injunctions are reduced if courts regularly grant stays to permanent injunctions to give defendants time to redesign their products to avoid infringement when this is possible. Second, we show how hold-up problems are magnified in the presence of royalty stacking, i.e., when multiple patents read on a single product. Third, using third-generation cellular telephones and Wi-Fi as leading examples, we illustrate that royalty stacking can become a very serious problem, especially in the standard-setting context where hundreds or even thousands of patents can read on a single product standard. Fourth, we discuss the use of “reasonable royalties” to award damages in patent infringement cases. We report empirical results regarding the measurement of “reasonable royalties” by the courts and identify various practical problems that tend to lead courts to over-estimate “reasonable royalties” in the presence of royalty stacking. Finally, we make suggestions for

The traditional theory of IP is that the prospect of future reward provides an ex ante incentive to innovate. An increasingly common justification for longer and more powerful IP rights is ex post - that IP will be "managed" most efficiently if control is consolidated in a single owner. This argument is made, for example, in the prospect and rent dissipation literature in patent law, in justifications for expansive rights of publicity, and in defense of the Bono Copyright Term Extension Act. Taken to an extreme, this argument justifies perpetual protection with no real exceptions. Those who rely on this theory take the idea of IP as "property" too seriously, and reason that since individual pieces of property are perpetually managed, IP should be too. But IP isn't just like real property; indeed, it gives IP owners control over what others do with their real property. The ex post justification is strikingly anti-market. We would never say today that the market for paper clips would be "efficiently managed" if put into the hands of a single firm. We rely on competition to do that for us. But that is exactly what the ex post theory would do.In this paper, I explore the sub rosa development of this ex post theory of IP. I argue that the basis for continued control is the assumption that the value of IP rights will be dissipated if they are used too much. This argument is fundamentally at odds with the public goods nature of information. It stems from a particular sort of myopia about private ordering, in which actions by individual private firms are presumed to be ideal and the traditional role of the market in disciplining errant firms is ignored.

We have argued elsewhere that peer-to-peer (p2p) file sharing poses significant new challenges to the enforcement of copyright law. Copyright owners' initial response to these challenges - to try to shut down the technologies that facilitate file sharing - is bad for society. We suggested that it would be preferable to lower enforcement costs for copyright owners by making dispute resolution by copyright owners against direct infringers quick and cheap, so that copyright owners would be more inclined to pursue such direct infringers instead of suing innovators. While enforcement costs are likely always to be too great to allow pursuit of every infringer, lower costs would allow for enforcement against more infringers, increasing any given infringer's chance of being sued. In this article, we explain how such a dispute resolution system might work, and propose a draft amendment to the copyright act to implement the system.

Suing actual infringers is passe in copyright law. In the digital environment, the real stakes lie in suing those who facilitate infringement by others. There is of course a good reason copyright owners are filing such suits. They see themselves as under threat from a flood of cheap, easy copies and a dramatic increase in the number of people who can make those copies. The high volume of illegal uses, and the low return to suing any individual, make it more cost-effective to aim as far up the chain as possible. From the perspective of the movie industry, it's easier and more effective to shut down Napster than to sue the millions of people who traded files illegally on Napster. So far, the courts have been willing to go along, shutting down a number of innovative services in the digital music realm.In this article, we argue that unrestricted liability for anyone who is in any way involved with copyright infringement is a bad idea. Indirect liability is a continuum, in which acts most closely related to infringement and with the fewest affirmative benefits are the easiest to condemn. Going after makers of technology for the uses to which their technologies may be put threatens to stifle innovation. The fundamental difficulty is that while courts can make decisions about direct infringement on a case-by-case basis, lawsuits based on indirect liability necessarily sweep together both socially beneficial and socially harmful uses of a program or service, either permitting both uses or condemning both.Optimal digital copyright policy would do two things: stop deterring innovators, and permit cost-effective enforcement of copyright in the digital environment. In this paper, we suggest at least two possible alternatives that might provide ways out of the digital copyright morass. Both alternatives stem from the basic economics of copyright enforcement. It is not currently cost-effective for copyright owners to sue individual infringers, because there are tens of millions o

Economists often assume that a patent gives its owner a well-defined legal right to exclude others from practicing the invention described in the patent. In practice, however, the rights afforded to patent holders are highly uncertain. Under patent law, a patent is no guarantee of exclusion but more precisely a legal right to try to exclude. Since only 0.1% of all patents are litigated to trial, and since nearly half of fully litigated patents are declared invalid, this distinction is critical to understanding the economic impact of patents. The growing recognition among economists and legal scholars that patents are probabilistic property rights has significant implications for our understanding of patents in four important areas: (1) reform of the system by which patents are granted; (2) the legal treatment of patents in litigation; (3) the incentives of patent holders and alleged infringers to settle their disputes through licensing or cross-licensing agreements rather than litigate them to completion; and (4) the antitrust limits on agreements between rivals that settle actual or threatened patent litigation.

The traditional theory of IP is that the prospect of future reward provides an ex ante incentive to innovate. An increasingly common justification for longer and more powerful IP rights is ex post - that IP will be "managed" most efficiently if control is consolidated in a single owner. This argument is made, for example, in the prospect and rent dissipation literature in patent law, in justifications for expansive rights of publicity, and in defense of the Bono Copyright Term Extension Act. Taken to an extreme, this argument justifies perpetual protection with no real exceptions. Those who rely on this theory take the idea of IP as "property" too seriously, and reason that since individual pieces of property are perpetually managed, IP should be too. But IP isn't just like real property; indeed, it gives IP owners control over what others do with their real property. The ex post justification is strikingly anti-market. We would never say today that the market for paper clips would be "efficiently managed" if put into the hands of a single firm. We rely on competition to do that for us. But that is exactly what the ex post theory would do.In this paper, I explore the sub rosa development of this ex post theory of IP. I argue that the basis for continued control is the assumption that the value of IP rights will be dissipated if they are used too much. This argument is fundamentally at odds with the public goods nature of information. It stems from a particular sort of myopia about private ordering, in which actions by individual private firms are presumed to be ideal and the traditional role of the market in disciplining errant firms is ignored.

We have argued elsewhere that peer-to-peer (p2p) file sharing poses significant new challenges to the enforcement of copyright law. Copyright owners' initial response to these challenges - to try to shut down the technologies that facilitate file sharing - is bad for society. We suggested that it would be preferable to lower enforcement costs for copyright owners by making dispute resolution by copyright owners against direct infringers quick and cheap, so that copyright owners would be more inclined to pursue such direct infringers instead of suing innovators. While enforcement costs are likely always to be too great to allow pursuit of every infringer, lower costs would allow for enforcement against more infringers, increasing any given infringer's chance of being sued. In this article, we explain how such a dispute resolution system might work, and propose a draft amendment to the copyright act to implement the system.

Suing actual infringers is passe in copyright law. In the digital environment, the real stakes lie in suing those who facilitate infringement by others. There is of course a good reason copyright owners are filing such suits. They see themselves as under threat from a flood of cheap, easy copies and a dramatic increase in the number of people who can make those copies. The high volume of illegal uses, and the low return to suing any individual, make it more cost-effective to aim as far up the chain as possible. From the perspective of the movie industry, it's easier and more effective to shut down Napster than to sue the millions of people who traded files illegally on Napster. So far, the courts have been willing to go along, shutting down a number of innovative services in the digital music realm.In this article, we argue that unrestricted liability for anyone who is in any way involved with copyright infringement is a bad idea. Indirect liability is a continuum, in which acts most closely related to infringement and with the fewest affirmative benefits are the easiest to condemn. Going after makers of technology for the uses to which their technologies may be put threatens to stifle innovation. The fundamental difficulty is that while courts can make decisions about direct infringement on a case-by-case basis, lawsuits based on indirect liability necessarily sweep together both socially beneficial and socially harmful uses of a program or service, either permitting both uses or condemning both.Optimal digital copyright policy would do two things: stop deterring innovators, and permit cost-effective enforcement of copyright in the digital environment. In this paper, we suggest at least two possible alternatives that might provide ways out of the digital copyright morass. Both alternatives stem from the basic economics of copyright enforcement. It is not currently cost-effective for copyright owners to sue individual infringers, because there are tens of millions o

Economists often assume that a patent gives its owner a well-defined legal right to exclude others from practicing the invention described in the patent. In practice, however, the rights afforded to patent holders are highly uncertain. Under patent law, a patent is no guarantee of exclusion but more precisely a legal right to try to exclude. Since only 0.1% of all patents are litigated to trial, and since nearly half of fully litigated patents are declared invalid, this distinction is critical to understanding the economic impact of patents. The growing recognition among economists and legal scholars that patents are probabilistic property rights has significant implications for our understanding of patents in four important areas: (1) reform of the system by which patents are granted; (2) the legal treatment of patents in litigation; (3) the incentives of patent holders and alleged infringers to settle their disputes through licensing or cross-licensing agreements rather than litigate them to completion; and (4) the antitrust limits on agreements between rivals that settle actual or threatened patent litigation.

The United States is the only country in the world that awards patents to the first person to invent something, rather than the first to file a patent application. In order to determine who is first to invent, the United States has created an elaborate set of "interference" proceedings and legal standards to define invention and decide how it may be proven. Supporters of this system claim that it is necessary to protect small inventors, who may not have the resources to file patent applications quickly, and may therefore lose a patent race to large companies who invented after they did. Advocates of global patent harmonization have suggested, however, that the first inventor is usually also the first to file, and that the first-to-invent standard is unnecessary and wasteful.In this Article, we study U.S. Patent and Trademark Office ("PTO") interference proceedings and court cases in which the parties dispute who is first to invent. We find that the first person to file is usually, but by no means always, also the first to invent. In over 40% of the cases, the first to invent is last to file. We also find that the long-standing rule that discriminated against foreign inventors by requiring proof of inventive activity in the U.S. had surprisingly little effect on outcomes; that a large number of priority disputes involve near-simultaneous invention; and that the vast majority of such disputes could be resolved without reliance on much of the evidence the law permits. Finally, we study the role of small inventors to see whether they are disproportionately the beneficiaries of the first to invent system. While the evidence is mixed, it does not appear that small inventors particularly benefit from the first to invent system.Part I describes the legal background for the international debate over how to determine patent priority. Part II describes our studies and discusses our results in detail. Finally, Part III draws conclusions for policy-makers from the data. There is

One of the oddest things to an outsider about the United States patent system is that due to continuation practice it is impossible for the U.S. Patent and Trademark Office (PTO) ever to finally reject a patent application. Continuation applications have led to abuse of the patent prosecution process. They serve very little useful purpose, and what benefits they confer may be outweighed by their potential for mischief. In an effort to study the pervasiveness of continuation practice, we compiled an original dataset comprising 2,224,379 patents, every patent issued from 1976 through 2000. We found that while continuations are filed in 23% of all patent applications, patents based on continuation applications represent 52% of all litigated patents. Although continuations are used in a minority of all patents, it is the most important minority because it is the minority most likely to end up in litigation. We examine the efforts undertaken to control the problems associated with continuation patents (changing the patent term, publishing applications, prosecution laches) and find them insufficient. The world would probably be a better place if they were abolished. Recognizing, however, that the abuse of continuation practice is not as pervasive as some might think, we propose a number of means by which Congress and the courts could strengthen existing rules designed to limit their abuse while preserving the practice. At a minimum, the empirical data we present can provide litigants and judges with a baseline for assessing the reasonableness of delay caused by the filing of multiple continuations by the patentee in determining the applicability of equitable remedies such as prosecution laches.

Patent law turns the attorney-client privilege on its head. Patent law punishes willful infringers by subjecting them to treble damages. An odd set of legal rules stemming from patent law's effort to determine what constitutes willful infringement effectively requires companies confronted with a patent first to obtain a written opinion of counsel and then to disclose that opinion in court. To do that, the accused infringer will have to waive its attorney-client privilege in virtually every case. Even worse, the law puts the question whether an accused infringer will have to waive privilege in the hands of the patent owner, who can send a carefully crafted letter putting a potential defendant on notice of the patent. A patent owner thus triggers the obligation to obtain a written opinion of counsel without actually threatening to sue anyone. In turn, accused infringers who are aware of these rules respond to such letters by obtaining a sort of pseudo-legal advice that both they and their attorneys recognize to be a construct. Both plaintiffs and defendants are playing a costly game.The rules of this game have perverse consequences for patent law. Some of these consequences affect litigation - lawyers and clients who know that the lawyer's advice will be disclosed to the other side will behave differently, withholding information and candid advice from each other. But other consequences extend beyond litigation. They infect pre-litigation advice, essentially making it impossible for a competent lawyer to advise a client that a competitor's patent should be avoided. The rules of the willful infringement game set traps for the unwary, who may not realize the consequences of failing to obtain the necessary written opinion of counsel. They interfere with a client's ability to choose counsel. And they discourage engineers and companies from reading a competitor's patents at all, thereby undermining the disclosure function that is at the foundation of the patent system.One

Patent law turns the attorney-client privilege on its head. Patent law punishes willful infringers by subjecting them to treble damages. An odd set of legal rules stemming from patent law's effort to determine what constitutes willful infringement effectively requires companies confronted with a patent first to obtain a written opinion of counsel and then to disclose that opinion in court. To do that, the accused infringer will have to waive its attorney-client privilege in virtually every case. Even worse, the law puts the question whether an accused infringer will have to waive privilege in the hands of the patent owner, who can send a carefully crafted letter putting a potential defendant on notice of the patent. A patent owner thus triggers the obligation to obtain a written opinion of counsel without actually threatening to sue anyone. In turn, accused infringers who are aware of these rules respond to such letters by obtaining a sort of pseudo-legal advice that both they and their attorneys recognize to be a construct. Both plaintiffs and defendants are playing a costly game.The rules of this game have perverse consequences for patent law. Some of these consequences affect litigation - lawyers and clients who know that the lawyer's advice will be disclosed to the other side will behave differently, withholding information and candid advice from each other. But other consequences extend beyond litigation. They infect pre-litigation advice, essentially making it impossible for a competent lawyer to advise a client that a competitor's patent should be avoided. The rules of the willful infringement game set traps for the unwary, who may not realize the consequences of failing to obtain the necessary written opinion of counsel. They interfere with a client's ability to choose counsel. And they discourage engineers and companies from reading a competitor's patents at all, thereby undermining the disclosure function that is at the foundation of the patent system.One

The United States is the only country in the world that awards patents to the first person to invent something, rather than the first to file a patent application. In order to determine who is first to invent, the United States has created an elaborate set of "interference" proceedings and legal standards to define invention and decide how it may be proven. Supporters of this system claim that it is necessary to protect small inventors, who may not have the resources to file patent applications quickly, and may therefore lose a patent race to large companies who invented after they did. Advocates of global patent harmonization have suggested, however, that the first inventor is usually also the first to file, and that the first-to-invent standard is unnecessary and wasteful.In this Article, we study U.S. Patent and Trademark Office ("PTO") interference proceedings and court cases in which the parties dispute who is first to invent. We find that the first person to file is usually, but by no means always, also the first to invent. In over 40% of the cases, the first to invent is last to file. We also find that the long-standing rule that discriminated against foreign inventors by requiring proof of inventive activity in the U.S. had surprisingly little effect on outcomes; that a large number of priority disputes involve near-simultaneous invention; and that the vast majority of such disputes could be resolved without reliance on much of the evidence the law permits. Finally, we study the role of small inventors to see whether they are disproportionately the beneficiaries of the first to invent system. While the evidence is mixed, it does not appear that small inventors particularly benefit from the first to invent system.Part I describes the legal background for the international debate over how to determine patent priority. Part II describes our studies and discusses our results in detail. Finally, Part III draws conclusions for policy-makers from the data. There is

One of the oddest things to an outsider about the United States patent system is that due to continuation practice it is impossible for the U.S. Patent and Trademark Office (PTO) ever to finally reject a patent application. Continuation applications have led to abuse of the patent prosecution process. They serve very little useful purpose, and what benefits they confer may be outweighed by their potential for mischief. In an effort to study the pervasiveness of continuation practice, we compiled an original dataset comprising 2,224,379 patents, every patent issued from 1976 through 2000. We found that while continuations are filed in 23% of all patent applications, patents based on continuation applications represent 52% of all litigated patents. Although continuations are used in a minority of all patents, it is the most important minority because it is the minority most likely to end up in litigation. We examine the efforts undertaken to control the problems associated with continuation patents (changing the patent term, publishing applications, prosecution laches) and find them insufficient. The world would probably be a better place if they were abolished. Recognizing, however, that the abuse of continuation practice is not as pervasive as some might think, we propose a number of means by which Congress and the courts could strengthen existing rules designed to limit their abuse while preserving the practice. At a minimum, the empirical data we present can provide litigants and judges with a baseline for assessing the reasonableness of delay caused by the filing of multiple continuations by the patentee in determining the applicability of equitable remedies such as prosecution laches.

The role of institutions in mediating the use of intellectual property rights has long been neglected in debates over the economics of intellectual property. In a path-breaking work, Rob Merges studied what he calls "collective rights organizations," industry groups that collect intellectual property rights from owners and license them as a package. Merges finds that these organizations ease some of the tensions created by strong intellectual property rights by allowing industries to bargain from a property rule into a liability rule. Collective rights organizations thus play a valuable role in facilitating transactions in intellectual property rights.There is another sort of organization that mediates between intellectual property owners and users, however. Standard-setting organizations (SSOs) regularly encounter situations in which one or more companies claim to own proprietary rights that cover a proposed industry standard. The industry cannot adopt the standard without the permission of the intellectual property owner (or owners).How SSOs respond to those who assert intellectual property rights is critically important. Whether or not private companies retain intellectual property rights in group standards will determine whether a standard is "open" or "closed." It will determine who can sell compliant products, and it may well influence whether the standard adopted in the market is one chosen by a group or one offered by a single company. SSO rules governing intellectual property rights will also affect how standards change as technology improves.Given the importance of SSO rules governing intellectual property rights, there has been surprisingly little treatment of SSO intellectual property rules in the legal literature. My aim in this article is to fill that void. To do so, I have studied the intellectual property policies of dozens of SSOs, primarily but not exclusively in the computer networking and telecommunications industries. This is no accident; interf

The role of institutions in mediating the use of intellectual property rights has long been neglected in debates over the economics of intellectual property. In a path-breaking work, Rob Merges studied what he calls "collective rights organizations," industry groups that collect intellectual property rights from owners and license them as a package. Merges finds that these organizations ease some of the tensions created by strong intellectual property rights by allowing industries to bargain from a property rule into a liability rule. Collective rights organizations thus play a valuable role in facilitating transactions in intellectual property rights.There is another sort of organization that mediates between intellectual property owners and users, however. Standard-setting organizations (SSOs) regularly encounter situations in which one or more companies claim to own proprietary rights that cover a proposed industry standard. The industry cannot adopt the standard without the permission of the intellectual property owner (or owners).How SSOs respond to those who assert intellectual property rights is critically important. Whether or not private companies retain intellectual property rights in group standards will determine whether a standard is "open" or "closed." It will determine who can sell compliant products, and it may well influence whether the standard adopted in the market is one chosen by a group or one offered by a single company. SSO rules governing intellectual property rights will also affect how standards change as technology improves.Given the importance of SSO rules governing intellectual property rights, there has been surprisingly little treatment of SSO intellectual property rules in the legal literature. My aim in this article is to fill that void. To do so, I have studied the intellectual property policies of dozens of SSOs, primarily but not exclusively in the computer networking and telecommunications industries. This is no accident; interf

BackgroundEjection fraction (EF) reserve has been found to be a useful adjunct for identifying high risk coronary artery disease in cardiac positron emission tomography (PET). We aimed to evaluate EF reserve obtained from technetium-99m sestamibi (Tc-99m) high-efficiency (HE) SPECT.MethodsFifty patients (mean age 69 years) undergoing regadenoson same-day rest (8-11 mCi)/stress (32-42 mCi) Tc-99m gated HE SPECT were enrolled. Stress imaging was started 1 minute after sequential intravenous regadenoson .4 mg and Tc-99m injections, and was composed of five 2 minutes supine gated acquisitions followed by two 4 minutes supine and upright images. Ischemic total perfusion deficit (ITPD) ≥5 % was considered as significant ischemia.ResultsSignificantly lower mean EF reserve was obtained in the 5th and 9th minute after regadenoson bolus in patients with significant ischemia vs patients without (5th minute: -4.2 ± 4.6% vs 1.3 ± 6.6%, P = .006; 9th minute: -2.7 ± 4.8% vs 2.0 ± 6.6%, P = .03).ConclusionsNegative EF reserve obtained between 5th and 9th minutes of regadenoson stress demonstrated best concordance with significant ischemia and may be a promising tool for detection of transient ischemic functional changes with Tc-99m HE-SPECT.

In the Festo decision, the Federal Circuit significantly changed the scope of the doctrine of equivalents in patent law. The doctrine of prosecution history estoppel precludes a patent owner from claiming during litigation to own ground given up during patent prosecution. Under the old rule, called the "flexible bar," estoppel was based on a multi-factor test and would apply only if the patentee had no choice but to amend its claims in the way it did. Festo replaced the flexible bar with an "absolute bar," under which virtually any amendment to a patent precludes resort to the doctrine of equivalents for that claim element.The Supreme Court is now considering whether the flexible or absolute bar is the right rule. We believe there is middle ground in this debate that has been ignored with both parties. Whether prosecution history estoppel applies to any given amendment should depend on the reasonably foreseeable effect of that amendment. Normally, patentees will understand that they are surrendering coverage by amending their patent claims, and so a rule precluding them from reclaiming that ground makes sense. But in some cases the absolute bar will produce unexpected and unintended results. We argue that the application of estoppel should turn on whether the effect of a change would be foreseeable to a reasonable patentee at the time of the amendment. This "foreseeable" bar better balances the competing policies of strong protection for pioneering inventors and notice to improvers who wish to design around a patent.

In this Article, we compare a data set of 1000 U.S. patents issued between 1996 and 1998 to a similarly random sample of 1000 patents issued twenty years earlier, between 1976 and 1978. By studying the differences between the groups, we can get a clear picture of how the patent system has changed over time. The results are dramatic. By almost any measure - subject matter, time spent in prosecution, number of prior art references cited, number of claims, number of continuation applications filed, number of inventors - the patents issued in the late 1990s are more complex than those issued in the 1970s. While some of these effects are attributable to the patenting of new technologies like biotechnology and software, unknown in the early 1970s, the increase in complexity is robust even across areas of technology. Further, the patent system in the 1990s is more heterogeneous than it was in the 1970s. There are far greater differences by area of technology and by nationality in how patents are being prosecuted in the 1990s than there were in the 1970s. We explore a number of possible explanations for these results, and discuss the policy implications of the lack of uniformity that now characterizes our patent system.

It is common to assert that the Patent and Trademark Office does a bad job of examining patents, and that it should spend more time and money weeding out bad patents. In this article, Professor Lemley challenges that conventional wisdom. Using available data regarding the cost and incidence of patent prosecution, litigation, licensing and other uses of patents, he demonstrates that strengthening the examination process is not cost effective. The core insight is that very few patents are actually litigated or licensed; most simply sit on a shelf unused, or are used only for noncontroversial purposes like financing. Because of this, society would be better off spending its resources in a more searching judicial inquiry into validity in those few cases in which it matters than paying for a more protracted examination of all patents ex ante. In economic terms, the patent office is "rationally ignorant" of the objective validity of the patents it issues.

In the Festo decision, the Federal Circuit significantly changed the scope of the doctrine of equivalents in patent law. The doctrine of prosecution history estoppel precludes a patent owner from claiming during litigation to own ground given up during patent prosecution. Under the old rule, called the "flexible bar," estoppel was based on a multi-factor test and would apply only if the patentee had no choice but to amend its claims in the way it did. Festo replaced the flexible bar with an "absolute bar," under which virtually any amendment to a patent precludes resort to the doctrine of equivalents for that claim element.The Supreme Court is now considering whether the flexible or absolute bar is the right rule. We believe there is middle ground in this debate that has been ignored with both parties. Whether prosecution history estoppel applies to any given amendment should depend on the reasonably foreseeable effect of that amendment. Normally, patentees will understand that they are surrendering coverage by amending their patent claims, and so a rule precluding them from reclaiming that ground makes sense. But in some cases the absolute bar will produce unexpected and unintended results. We argue that the application of estoppel should turn on whether the effect of a change would be foreseeable to a reasonable patentee at the time of the amendment. This "foreseeable" bar better balances the competing policies of strong protection for pioneering inventors and notice to improvers who wish to design around a patent.

In this Article, we compare a data set of 1000 U.S. patents issued between 1996 and 1998 to a similarly random sample of 1000 patents issued twenty years earlier, between 1976 and 1978. By studying the differences between the groups, we can get a clear picture of how the patent system has changed over time. The results are dramatic. By almost any measure - subject matter, time spent in prosecution, number of prior art references cited, number of claims, number of continuation applications filed, number of inventors - the patents issued in the late 1990s are more complex than those issued in the 1970s. While some of these effects are attributable to the patenting of new technologies like biotechnology and software, unknown in the early 1970s, the increase in complexity is robust even across areas of technology. Further, the patent system in the 1990s is more heterogeneous than it was in the 1970s. There are far greater differences by area of technology and by nationality in how patents are being prosecuted in the 1990s than there were in the 1970s. We explore a number of possible explanations for these results, and discuss the policy implications of the lack of uniformity that now characterizes our patent system.

It is common to assert that the Patent and Trademark Office does a bad job of examining patents, and that it should spend more time and money weeding out bad patents. In this article, Professor Lemley challenges that conventional wisdom. Using available data regarding the cost and incidence of patent prosecution, litigation, licensing and other uses of patents, he demonstrates that strengthening the examination process is not cost effective. The core insight is that very few patents are actually litigated or licensed; most simply sit on a shelf unused, or are used only for noncontroversial purposes like financing. Because of this, society would be better off spending its resources in a more searching judicial inquiry into validity in those few cases in which it matters than paying for a more protracted examination of all patents ex ante. In economic terms, the patent office is "rationally ignorant" of the objective validity of the patents it issues.

In this paper, we address the question of "open access" and its relationship to the architecture of the Internet. It is our view that the extraordinary growth and innovation of the Internet depends crucially upon this architecture. Changes in this architecture should be viewed with skepticism, as they may in turn threaten this innovation and growth. Many cable companies have recently adopted or threatened a policy of bundling high-speed cable modem service with ISP service. This bundling threatens to compromise an important architectural principle of the Internet: the Internet's "End-to-End" design. In our view, this change could have profound implications for the future of growth and innovation on the net. The FCC's analysis of the cable modem industry to date has not considered these principles of the Internet's design. It therefore does not adequately evaluate the potential threat that bundling presents to open access to the Internet. Neither does the FCC's approach properly account for its role in creating the conditions that made the Internet possible. Under the banner of "no regulation," the FCC threatens to permit this network to calcify as earlier telecommunications networks did. Further, and ironically, the FCC's supposed "hands off" approach will ultimately lead to more rather than less regulation. We do not yet know enough about the relationship between these architectural principles and the innovation of the Internet. But we should know enough to be skeptical of changes in its design. The strong presumption should be in favor of preserving the architectural features that have produced this extraordinary innovation. The FCC's presumption should be against approving mergers or policies that threaten these design principles, without a clear showing that the threat would not undermine the Internet's innovation.

We recently studied the outcomes of every final written patent validity decision at both the district court and Federal Circuit levels between 1989 and 1996. The study produced a variety of interesting statistics on patent validity questions. Using the dataset from that study, and matching it with the panels serving on each case, we describe in this paper how individual Federal Circuit judges voted in patent validity cases during that period.The results may surprise many patent litigators. While there are some interesting differences in voting patterns, our overall conclusion is that the votes of Federal Circuit judges during this period defied easy description. Judges do not fit easily into "pro-patent" or "anti-patent" categories, or into "affirmers" and "reversers." We think this is a good thing for the court system. Still, there are some interesting facts to be found in the data.

We have studied a large, random sample of U.S. patents issued between 1996 and 1998. We collected a variety of information about these patents, including area of technology, national origin, the number of inventors, nature and size of the owning entity, the number and type of prior art references, and the time spent in prosecution. We seek to establish relationships between a number of variables in issued patents-such as number of inventors, numbers and types of references to the "prior art," numbers and types of "claims," and length of time between application and issuance-and a number of defined areas of technology. We identify the countries in which particular inventions originated--almost one-half of all issued U.S. patents cover inventions originating in other countries--and test for relationships between the above variables and countries of origin. We also evaluate relationships between countries of origin and areas of technology. The conclusions are somewhat surprising, and point to a patent system that is far from unitary in the way it treats different inventors and different inventions.

It is common to assert that the Patent and Trademark Office does a bad job of examining patents, and that it should spend more time and money weeding out bad patents. In this article, Professor Lemley challenges that conventional wisdom. Using available data regarding the cost and incidence of patent prosecution, litigation, licensing and other uses of patents, he demonstrates that strengthening the examination process is not cost effective. The core insight is that very few patents are actually litigated or licensed; most simply sit on a shelf unused, or are used only for noncontroversial purposes like financing. Because of this, society would be better off spending its resources in a more searching judicial inquiry into validity in those few cases in which it matters than paying for a more protracted examination of all patents ex ante. In economic terms, the patent office is "rationally ignorant" of the objective validity of the patents it issues.

We recently studied the outcomes of every final written patent validity decision at both the district court and Federal Circuit levels between 1989 and 1996. The study produced a variety of interesting statistics on patent validity questions. Using the dataset from that study, and matching it with the panels serving on each case, we describe in this paper how individual Federal Circuit judges voted in patent validity cases during that period.The results may surprise many patent litigators. While there are some interesting differences in voting patterns, our overall conclusion is that the votes of Federal Circuit judges during this period defied easy description. Judges do not fit easily into "pro-patent" or "anti-patent" categories, or into "affirmers" and "reversers." We think this is a good thing for the court system. Still, there are some interesting facts to be found in the data.

In this paper, we address the question of "open access" and its relationship to the architecture of the Internet. It is our view that the extraordinary growth and innovation of the Internet depends crucially upon this architecture. Changes in this architecture should be viewed with skepticism, as they may in turn threaten this innovation and growth. Many cable companies have recently adopted or threatened a policy of bundling high-speed cable modem service with ISP service. This bundling threatens to compromise an important architectural principle of the Internet: the Internet's "End-to-End" design. In our view, this change could have profound implications for the future of growth and innovation on the net. The FCC's analysis of the cable modem industry to date has not considered these principles of the Internet's design. It therefore does not adequately evaluate the potential threat that bundling presents to open access to the Internet. Neither does the FCC's approach properly account for its role in creating the conditions that made the Internet possible. Under the banner of "no regulation," the FCC threatens to permit this network to calcify as earlier telecommunications networks did. Further, and ironically, the FCC's supposed "hands off" approach will ultimately lead to more rather than less regulation. We do not yet know enough about the relationship between these architectural principles and the innovation of the Internet. But we should know enough to be skeptical of changes in its design. The strong presumption should be in favor of preserving the architectural features that have produced this extraordinary innovation. The FCC's presumption should be against approving mergers or policies that threaten these design principles, without a clear showing that the threat would not undermine the Internet's innovation.

We have studied a large, random sample of U.S. patents issued between 1996 and 1998. We collected a variety of information about these patents, including area of technology, national origin, the number of inventors, nature and size of the owning entity, the number and type of prior art references, and the time spent in prosecution. We seek to establish relationships between a number of variables in issued patents-such as number of inventors, numbers and types of references to the "prior art," numbers and types of "claims," and length of time between application and issuance-and a number of defined areas of technology. We identify the countries in which particular inventions originated--almost one-half of all issued U.S. patents cover inventions originating in other countries--and test for relationships between the above variables and countries of origin. We also evaluate relationships between countries of origin and areas of technology. The conclusions are somewhat surprising, and point to a patent system that is far from unitary in the way it treats different inventors and different inventions.