Posts Tagged: "rule of reason"

The Supreme Court’s Actavis Decision, Or Why Pay-for-Delay Litigation Just Got More Active

In this case, the Supreme Court considered an arrangement by which brand firm Solvay paid generics Watson (now Actavis) and Paddock roughly $30 to $40 million to delay entering the market with generic versions of testosterone gel. The Eleventh Circuit upheld the activity, concluding that “absent sham litigation or fraud in obtaining the patent, a reverse payment settlement is immune from antitrust attack so long as its anticompetitive effects fall within the scope of the exclusionary potential of the patent.” The court explained that “[p]atent holders have a ‘lawful right to exclude others from the market’” and that a patent “conveys the right to cripple competition.”

The Supreme Court reversed the Eleventh Circuit, concluding that, while a valid patent allows a patentee to charge “higher-than-competitive” prices, “an invalidated patent carries with it no such right.” The Court recognized the policy encouraging settlements. But for five reasons, it found that that policy did not dictate immunity for pay-for-delay settlements.

Michael Carrier

June 18, 2013

Patent Misuse, Exploring the Basics

The term “patent misuse” refers to specific types of prohibited behavior engaged in by the owner of the patent rights. Patent misuse is an affirmative defense that recognizes that it is possible for a patent owner to abuse the exclusive right enjoyed as a result of the issuance of a patent. As an affirmative defense, patent misuse cannot be used as a sword, but can only be used by an alleged infringer if and when the patent owner seeks to enforce the exclusive right of the patent in a patent infringement suit. Once a patent infringement suit is initiated, the alleged infringer, in order to successfully rely upon the patent misuse defense, must “show that the patentee has impermissibly broadened the ‘physical or temporal scope’ of the patent grant with anticompetitive effect.” If the alleged infringer can demonstrate that the patent owner did engaged in prohibited behavior, the patent will be unenforceable despite the fact that it is valid. In this respect, patent misuse is similar to the doctrine of inequitable conduct, which also works to make an entire patent unenforceable.

Gene Quinn

November 18, 2011

Antitrust Law Basics: A Primer on Patent and Copyright Misuse

With copyright misuse having recently been successful in a rather high profile case I thought it would be worthwhile to revisit patent misuse and misuse concepts generally. To do that in a way that allows the casually interested reader to follow along probably requires first taking a step back away from the intellectual property centric theories to discuss some basic antitrust law concepts. This seems particularly appropriate since many of the misuse cases have a distinct antitrust flavor.

Gene Quinn

November 17, 2011

Antitrust Issues in College Athletics: Should Needle Apply

Earlier this month Dechert LLP, representing an undisclosed number of companies (“stakeholders”), sent a letter to IMG College (“IMG”) and its licensing division, the Collegiate Licensing Company (“CLC”), and demanded that IMG and CLC cease and desist any efforts to restrict the number of licensees permitted to supply merchandise bearing the brands of various NCAA colleges and universities. It looks likes trademark and antitrust issues are back on the menu in sports, which makes intellectual property nerds like me very happy. We all knew American Needle Inc. v. National Football League (“Needle”) would embolden private antitrust suits; it was just a question of when. But a pivotal question is should Needle be extended to permit private antitrust suits in collegiate athletics?

Beth Hutchens

June 28, 2011

NFL Players vs. Owners: A Hail Mary of a Lawsuit

About 10 years ago, the NFLP decided that they wanted Reebok (and only Reebok) to make hats with the teams’ logos on them. American Needle, Inc., a competitor of Reebok, had been making these types of hats for the NFL for a really long time, and as a result of the NFLP’s deal with Reebok, it lost its contract with NFLP to make said hats. American Needle, Inc. did not have much of a sense of humor about this and sued the NFL under Antitrust principles. Enter American Needle v. National Football League et al. Needle is a big case because if the NFL had gotten what it asked for, the player’s union wouldn’t have been able to decertify and the players wouldn’t have been able to bring an antitrust suit.

Beth Hutchens

March 13, 2011