Living with Patents: Insights from Patent Misuse

Almost a century ago the United States Supreme Court created the patent misuse doctrine in response to complaints from those feeling the adverse effects of patents. Since then more nuanced legal limitations on obtaining, using and enforcing patents have been developed under antitrust and other laws. Those limitations better implement the current system’s primary goal of maximizing efficient market operation. The continued existence of patent misuse wastes time and resources on what has become not merely an obsolete but an affirmatively harmful doctrine. It should be promptly and completely eliminated. Although misuse no longer plays any useful role, the related experience provides valuable insights regarding how best to live with patents. First, it makes manifest the inescapable truth about any patent regime: It unavoidably produces social costs and those bearing the costs will complain. Second, it clarifies how to most appropriately respond to that inevitable discontent. Blaming and punishing patent owners for the regime’s inherent effects will not produce the desired result. Obtaining an appropriate outcome requires distinguishing between the different sources of patent discontent and addressing them on their individual merits. If the discontent arises because patent law’s internal procedures, rights and remedies fail to properly implement the goal set for the regime, then we should recalibrate the offending processes and rules. If it stems from inadequate antitrust or other general law supervision of the marketplace in which patents are deployed, then we should tighten that regulation. If it reflects the adverse effects of a properly implemented regime producing its targeted objective in an appropriately functioning market, then we should reassess the desirability of the goals themselves (including, in particular, the current emphasis on maximizing efficient market operation). But that normative discussion should be guided by the understanding that however fervently we may wish it, in patent law (as with the rest of life) we cannot have it all.