Antitrust and Intellectual Property

Hanno F. Kaiser · Benjamin N. Cardozo School of Law · Fall 2007

Herbert Hovenkamp's Antitrust Enterprise (2005), the DOJ/FTC IP Licensing Guidelines (1995), and the IP2 report (2007) should be studied with respect to each of the topics below. The articles and decisions are supplementary readings. This syllabus is a work in progress. If you have links to decisions, etc. please send me an email.

Download the Course Materials PDF Collection.

Class 1: Growth, Productivity, and Innovation: The (macro-) economic context of the AT-IP interface

• Herbert Hovenkamp, Antitrust Enterprise, Ch. 11
• Richard Stallman, The Danger of Software Patents (Audio) (2002)
• Cory Doctorow, How Hollywood, Congress, And DRM Are Beating Up The American Economy (2007)
• Mark A. Lemley, A New Balance Between IP and Antitrust (2007)
• Background: Measuring Economic Growth
• Background: Angus Maddison's website on historic GDP and population data.

Class 2: The Structure of the U.S. Antitrust Laws

• Herbert Hovenkamp, Antitrust Enterprise, Ch. 1, 2, 5 (Specifically: The rule of reason, p. 106–7)
• Horizontal agreements: Palmer v. BMG of Georgia, 498 U.S. 46 (1990)
• Monopolization: Verizon v. Trinko, 540 U.S. 398 (2004)
• Mergers: FTC v. Staples, Inc., 970 F. Supp. 1066 (D.C. 1997)
• Vertical agreements: Leegin Creative Leather Products, Inc. v. PSKS, 127 S. Ct. 2705 (2007)

We will discuss relevant economic concepts as they come up, in particular:

• Externalities, positive and negative
• Free riding
• Holdup
• Network effects
• Zero marginal cost production and "competition for the market"
• Commons-based peer production

Class 3: Market definition and market power

• Innovation markets; Standard Oil v. United States, 283 U.S. 163 (1931)
• The IP/market power inference; Illinois Tool Works v. Independent Ink, 547 U.S. 29 (2006)
• Aftermarket power; Eastman Kodak v. Image Technical Services, 504 U.S. 451 (1992) ("Kodak I")
• Carl Shapiro, Aftermarkets and Consumer Welfare: Making Sense of Kodak, 63 Antitrust L.J. 483 (1995)
• Jonathan Baker, Promoting Innovation Competition through the Aspen/Kodak Rule, 7 Geo. Mason L. Rev. 495 (1999)
• IP Licensing Guidelines: The goods, technology, and innovation market concept

Class 4: Refusals to license

• IP2, Ch. 1
• Data General v. Grumman, 36 F.3d 1147 (1st Cir. 1994). Read 1152–55; 1181–90.
• Image Technical Services v. Kodak, 125 F.3d 1195 (9th Cir. 1997)
• CSU v. Xerox, 203 F.3d 1322 (Fed. Cir. 2000)
• Intergraph v. Intel, 195 F.3d 1346 (Fed. Cir. 1995)
• Daniel J. Gifford, Antitrust's Troubled Relations with Intellectual Property, 87 Minn. L. Rev. 1695 (2003)

Class 5: Tying, bundling, and the elusive misuse doctrine

• IP2, Ch. 5
• United States v. Microsoft, 253 F.3d 34 (D.C. Cir. 2001)
• Illinois Tool Works v. Independent Ink, 547 U.S. 29 (2006). We will focus on the discussion of misuse.

Class 6: Incompatibility, FUD, DMCA, DRM

• Fulbright Chair Speaker Series: Fred von Lohmann (2006)
• The Chamberlain Group v. Skylink Technologies, 381 F.3d 1178 (Fed. Cir. 2004)
• Storage Technology Corp. v. Custom Hardware Engineering & Consulting, Ltd., 2006 WL 1766434 (D. Mass.)
• Tucker v. Apple, 2006 WL 4586090 (This is one badly written opinion. Its best feature is that it's short. The issues, however, are interesting.)
• Transamerica Computer Company v. IBM, 481 F. Supp. 965 (N.D. Cal. 1979)
• United States v. Microsoft, 253 F.3d 34 (D.C. Cir. 2001)

Class 7: Interlude: Fundamental Policy Questions: Exclusivity or Competition?

• John Perry Barlow, The Economy of Ideas (1993)
• Fulbright Chair Speaker Series: John Perry Barlow and John Gilmore (2006)
• Richard Stallman, Misinterpreting Copyright — A Series of Errors (2002)
• Jonathan Baker, Beyond Schumpeter vs. Arrow: How Antitrust Fosters Innovation (2007)
• Michele Boldrin & David K. Levine, Against Intellectual Monopoly (2007)
• Kai Raustiala & Christopher Sprigman, The Piracy Paradox: Innovation and Intellectual Property in Fashion Design (2007)
• N. Stephan Kinsella, Against Intellectual Property (2001)

Class 8: Licensing practices

• IP2, Ch. 4 and Ch. 6
• Geographical and field of use limitations
• Resale price maintenance after Leegin Creative Leather Products, Inc. v. PSKS, 127 S. Ct. 2705 (2007). Also read: United States v. General Electric, Co., 47 U.S. 192 (1926). This is one of the hot topics at the moment.
• Grantbacks
• Non-assertion clauses
• Reach through licenses

Class 9: Cross licenses and patent pools

• IP2, Ch. 3
• Fulbright Chair Speaker Series: Fred von Lohmann (2006)
• Richard Gilbert, Antitrust for Patent Pools: A Century of Policy Evolution (2004)
• Carl Shapiro, Navigating the Patent Thicket (2001)
• MPEG-2 Business Review Letter (1997)
• Patents in the MPEG-2 Pool as of 2007
• 3C DVD Business Review Letter (1998)
• 6C DVD Business Review Letter (1999)
• DVD FAQ (Maintained by the DVD Licensing Body)
• 3G Business Review Letter (2002)
• In re Summit Tech., Inc. et al. — Analysis of Proposed Consent Order to Aid Public Comment (1998)

Class 10: Standard setting

• IP2, Ch. 2
• Mark A. Lemley, Ten Things to Do About Patent Holdups of Standards (and One Not to) (2006)
• American Society of Mechanical Engineers Inc. v. Hydrolevel Corp, 456 U.S. 556 (1982)
• Allied Tube v. Indian Head, 486 U.S. 492 (1988)
• Radiant Burners v. People's Gas Light & Coke Co., 364 U.S. 656 (1961)
• In the Matter of Dell Computer Corp., 121 FTC 616 (1995)
• In re Rambus, 2006 WL 2330117
• VITA Business Review Letter (2007)
• IEEE Business Review Letter (2007)
• Gerald F. Masoudi, Antitrust Enforcement and Standard Setting: The VITA and IEEE Letters and the IP2 Report (2007)
• 15 U.S.C. 4301–4305 (Standards Development Organization Advancement Act of 2004)

Class 11: Settlements of antitrust disputes

• Schering Plough v. FTC, 402 F.3d 1056 (11th Cir. 2005)
• In re Tamoxifen Citrate Antitrust Litigation, 2006 WL 2401244 (2d Cir. 2006)
• In re Terazosin Hydrochloride Antitrust Litigation, 352 F. Supp. 2d 1279 (S.D. Fla. 2005)
• In re Cardizem CD Antitrust Litigation, 332 F.3d 896 (6th Cir. 2003)

Class 12: Mergers and Misuse

• See Course Materials PDF collection.

Class 13: Recap

• See Course Materials PDF collection.

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