'The Myth of the Sole Inventor' (Stanford Public Law Working Paper No. 1856610) by Mark A. Lemley comments
The theory of patent law is based on the idea that a lone genius can solve problems that stump the experts, and that the lone genius will do so only if properly incented. We deny patents on inventions that are "obvious" to ordinarily innovative scientists in the field. Our goal is to encourage extraordinary inventions – those that we wouldn’t expect to get without the incentive of a patent.
The canonical story of the lone genius inventor is largely a myth. Edison didn’t invent the light bulb; he found a bamboo fiber that worked better as a filament in the light bulb developed by Sawyer and Man, who in turn built on lighting work done by others. Bell filed for his telephone patent on the very same day as an independent inventor, Elisha Gray; the case ultimately went to the U.S. Supreme Court, which filled an entire volume of U.S. Reports resolving the question of whether Bell could have a patent despite the fact that he hadn’t actually gotten the invention to work at the time he filed. The Wright Brothers were the first to fly at Kitty Hawk, but their plane didn’t work very well, and was quickly surpassed by aircraft built by Glenn Curtis and others – planes that the Wrights delayed by over a decade with patent lawsuits.
The point can be made more general: surveys of hundreds of significant new technologies show that almost all of them are invented simultaneously or nearly simultaneously by two or more teams working independently of each other. Invention appears in significant part to be a social, not an individual, phenomenon. Inventors build on the work of those who came before, and new ideas are often "in the air," or result from changes in market demand or the availability of new or cheaper starting materials. And in the few circumstances where that is not true – where inventions truly are "singletons" – it is often because of an accident or error in the experiment rather than a conscious effort to invent.
The result is a real problem for classic theories of patent law. If we are supposed to be encouraging only inventions that others in the field couldn’t have made, we should be paying a lot more attention than we currently do to simultaneous invention. We should issuing very few patents – surely not the 200,000 per year we do today. And we should be denying patents on the vast majority of the most important inventions, since most seem to involve near-simultaneous invention. Put simply, our dominant theory of patent law doesn’t seem to explain the way we actually implement that law.
Maybe the problem is not with our current patent law, but with our current patent theory. But the dominant alternative theories of patent law don’t do much better. Prospect theory – under which we give patents early to one company so it can control research and development – makes little sense in a world in which ideas are in the air, likely to be happened upon by numerous inventors at about the same time. And commercialization theory, which hypothesizes that we grant patents in order to encourage not invention but product development, seems to founder on a related historical fact: most first inventors turn out to be lousy commercializers who end up delaying implementation of the invention by exercising their rights.
If patent law in its current form can be saved, we need an alternative justification for granting patents even in circumstances of near-simultaneous invention. I consider two other possibilities. First, patent rights encourage patent races, and that might actually be a good thing. Second, patents might facilitate markets for technology. Both have some logic to them, but neither fully justifies patent law in its current form. As a result, I offer some suggestions for reforming patent law to take account of the prevalence of simultaneous invention.
'Unfair Pricing and Standard Essential Patents' (EUI Working Paper RSCAS 2020/60) by Marco Botta comments
Technical standards that are agreed within a Standard Development Organization (SDO) often cover several ‘essential’ patents for the implementation of a standard (ie, Standard Essential Patents, SEPs). In order to allow for the standard implementation, the SEP holder commits to license its patents to any potential licensee on the basis of Fair and Reasonable and Non-Discriminatory (FRAND) conditions. In view of the recent ruling of the UK Supreme Court in Unwired Planet and the judgement of the German Bundesgerichtshof in Sisvel v Haier, the paper assumes that the FRAND commitment implies a ‘range’ rather than a ‘single’ royalty rate. On the other hand, a royalty rate ‘beyond the outer boundary of the range’ should be considered ‘unfair’, and thus incompatible with the FRAND commitment. Besides representing a breach of the FRAND commitment, an ‘unfair’ royalty rate might also be considered an abuse of a dominant position by the SEP holder, in breach of Art 102(a) TFEU. This paper analyses whether, and under what circumstances, Art 102(a) TFEU can be relied upon by a competition authority in Europe to sanction a case where an ‘unfair’ royalty rate has been set by the SEP holder. To this regard, the paper provides a detailed analysis of the EU Court of Justice’s jurisprudence on Art 102(a) TFEU. In particular, the latter jurisprudence is relied as a ‘yardstick’ to assess ‘when’ competition policy should sanction a request of unfair royalty rate by the SEP holder, ‘how’ a competition agency should assess the case and, eventually, ‘what’ remedies the competition authority might adopt.