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Texas Intellectual Property Law Journal
Volume 10

Issue 1 - Fall 2001


Rethinking Patent Damages
 
Citation:
10 Tex. Intell. Prop. L.J. 1 (2001)
 
Author:
Roger D. Blair & Thomas F. Cotter
 
About:
Roger D. Blair is Huber Hurst Professor of Business and Legal Studies, Department of Economics, University of Florida. Thomas F. Cotter is a University of Florida Research Foundation Professor, University of Florida Fredric G. Levin College of Law. We wish to thank Mark Lemley for his helpful comments; Kendra Hinton and Craig Popalis for their research assistance; and the Warrington College of Business and the Fredric G. Levin College of Law for research support. Any errors that remain are ours.
 
Abstract:
Our goal in this Article is to provide a comprehensive economic framework for analyzing and estimating patent damages in the form of either lost profits or reasonable royalties. A hypothetical case may serve to illustrate some of the complexities that can arise and that have often misled courts into over or underestimating the patentee’s actual damages. An intriguing current problem in the field of computer science is the development of speaker-independent voice recognition technology. At present, this technology is, in general, only about 80% accurate, and scientists expect that it will not materially improve in the absence of a major breakthrough, perhaps in our understanding of how the mind processes sound. Suppose, however, that a few years down the road a scientist (call her Alice) makes such a discovery and embodies it in a computer programmed to understand and transcribe English speech; she then markets her invention to, among others, television networks that provide closed-caption programming for the hearing impaired. A competitor, Bruce, markets a rival system that infringes Alice’s device. Alice normally will be entitled to an injunction forbidding Bruce from making, using, or selling Alice’s patented invention, but what damages should a court award for the period from the beginning of the infringement to the entry of the injunction?


Antitrust Counterclaims in Patent Infringement Cases: A Guide to Walker Process and Sham-Litigation Claims
 
Citation:
10 Tex. Intell. Prop. L.J. 95 (2001)
 
Author:
David R. Steinman & Danielle S. Fitzpatrick
 
About:
David R. Steinman and Danielle S. Fitzpatrick are attorneys in the Antitrust Group and the Intellectual Property & Technology Litigation Group, respectively, at Gray Cary Ware & Freidenrich, L.L.P.
 
Abstract:
The antitrust laws have become the weapon of choice for defendants facing patent infringement claims. The two most common antitrust counterclaims brought by infringement defendants are known as Walker Process claims and Handgards or sham litigation claims. Through sheer repetition and a philosophical change in the judiciary, motions to dismiss these counterclaims have become more difficult to win as courts have somewhat overlooked the stringent requirements of these causes of action. More claims now proceed through discovery and in some cases to a jury. As a result, patent holders should generally expect to face these expensive and potentially destructive antitrust claims brought as defensive measures against their patent infringement cases.

Further, some courts appear willing to consider novel antitrust theories, such as fraud on a standard-setting body, that expand the limited antitrust doctrines available in the patent context to include conduct that would normally be analyzed under the doctrine of patent misuse. Moreover, the Federal Trade Commission (“FTC”) is considering enacting a rule that would subject companies to antitrust liability for failing to disclose patents and even pending patent applications to standard-setting bodies to which they belong. These novel antitrust counterclaims pose serious litigation risks. The mere threat of treble damages, coupled with the loss of patent rights, obviously raises the stakes for patent holders pursuing infringement claims.

Legitimate patent holders should take some solace in the fact that these claims generally remain difficult to prove. This Article attempts to outline the elements of Walker Process and Handgards or sham litigation claims and to explain the grounds on which these claims may be attacked in motions to dismiss and/or at the summary judgment stage. The Article then addresses the recent Xerox case and its implications for antitrust plaintiffs and their attempts to expand the limited circumstances under which the Federal Circuit permits antitrust to infringe on patent rights.


Developments in U.S. Copyright Law 2000–2001: From Revising the Old South to Redefining the Digital Millennium
 
Citation:
10 Tex. Intell. Prop. L.J. 111 (2001)
 
Author:
Alicia Morris Groos
 
About:
Alicia Morris Groos is an associate in the Intellectual Property and Technology Section of Fulbright & Jaworski LLP. She recognizes Gretchen Hoffmann of Fulbright & Jaworski for her written contribution to the sections of this Article titled “First Test of Criminal Provisions of the DMCA: United States v. Sklyarov,” “Rulemaking and Related Actions Concerning Webcasting,” and the conclusion. She recognizes Natalie Timmers for her written contribution to Section III “Ownership of Electronic Versions of Copyrighted Works.” She extends special thanks to her husband, Cuatro Groos, for his support, and also thanks Neil Netanel, Gretchen Hoffmann, and Marlys West for their thoughtful comments and editing. Any remaining errors in the Article belong solely to the author.
 
Abstract:
This Article highlights developments in U.S. copyright law from September 2000 to August 2001. Given the volume of activity that has taken place during the past year, the Article does not purport to be a comprehensive review of everything that has happened during this period and expressly does not cover international copyright developments. It does focus, however, on many interesting new cases, pending federal legislation, and activities of the Copyright Office, as well as follows up on certain cases discussed in last year’s version of this Article.

The past year has seen much activity in cases involving the Digital Millennium Copyright Act, most notably the “Napster” case and other cases whose core disputes concern the interplay of traditional copyright protections with the technologies of the new millennium, such as the Internet, CD-ROMs, and digital databases. Further cases of note have applied modern facts and circumstances to test the limitations of traditional copyright doctrines, including fair use and work-for-hire. Many of the cases discussed herein have had their share of attention from the popular media, as copyright issues frequently touch the lives of ordinary citizens through such means as the Internet. The terminology, characters, and concepts of several hotly litigated cases either have been or have become household words—from “Barbie” and “Scarlett O’ Hara” to “Napster” and “MP3.” The main players in some of the cases, such as that involving the Gone With The Wind parody The Wind Done Gone, have even made appearances before the American public on the morning talk show circuit, demonstrating that many of the cases generate interest far beyond the walls of the courtroom and confines of the legal community.


Issue 2 - Winter 2002


“Other Transactions” with Uncle Sam: A Solution to the High-Tech Government Contracting Crisis
 
Citation:
10 Tex. Intell. Prop. L.J. 195 (2002)
 
Author:
David S. Bloch & James G. McEwen
 
About:
Mr. Bloch is an attorney with Gray Cary Ware & Freidenrich LLP, Palo Alto, California; B.A. (FBK), Reed College; M.P.H., The George Washington University School of Medicine and Health Sciences; J.D. with honors, The George Washington University National Law Center; Fellow in International Trade Law, University Institute of European Studies, Turin, Italy. Mr. Bloch was formerly a research assistant at the Government Contracts Program in Washington, D.C. Mr. McEwen is an attorney with Staas & Halsey LLP, Washington, D.C.; B.S.A.S.E., The University of Texas at Austin; J.D. with honors, The George Washington University National Law Center. Mr. McEwen was formerly an intellectual property attorney with the Naval Surface Warfare Center, Carderock Division, and the Naval Air Systems Command, specializing in the procurement and management of intellectual property. The opinions expressed in this Article do not represent the official positions of the authors’ respective employers or former employers. The authors wish to thank Kathryn McEwen for her invaluable editorial and bluebooking aid.
 
Abstract:
The United States Government, in particular, has a strong incentive to encourage inventive activity and to actively seek private contractors from which to buy new technologies. Such technologies maintain American military and economic supremacy in an increasingly fragmented world. It is fairly clear that the United States does not, as a matter of governmental policy, endorse the idea that intellectual property is a threat. In light of the Government’s difficulty in attracting high technology partners, however, current policies may not go far enough.

This paper surveys the history of intellectual property in government contracts and discusses the important differences between private-sector and government approaches to intellectual property rights. We conclude that the Department of Defense’s current “Other Transactions” authority, which allows the Government to negotiate with private sector companies on an equal footing and without the interference of complex procurement regulations, should be extended to other phases of procurement with the Department of Defense, applied more broadly to the rest of the government, and promoted as a new contracting model for Twenty-First Century partnerships between government and industry.


The Future of Music
 
Citation:
10 Tex. Intell. Prop. L.J. 221 (2002)
 
Author:
Jenny Toomey
 
About:
Ms. Toomey is the Executive Director of the Future of Music Coalition.
 
Abstract:
Editor’s note: on November 1, 2001, the Journal hosted a discussion on emerging intellectual-property issues in the distribution of music. The evening began with a presentation by Jenny Toomey, from the Future of Music Coalition. Following the presentation was a panel discussion, moderated by Professor R. Anthony Reese of The University of Texas School of Law, that fielded questions on various topics with diverse viewpoints. The panel included Ms. Toomey, Brian Szymczak, from the Austin office of Baker Botts L.L.P., and Garland Stephens, from the New York office of Pennie & Edmonds LLP. The following is an edited transcript of Ms. Toomey’s presentation.


Recent Developments in Trademark Law: Disrobing Trade Dress, Confounding Dilution, and Condemning Cybersquatting
 
Citation:
10 Tex. Intell. Prop. L.J. 245 (2002)
 
Author:
William G. Barber
 
About:
William G. Barber is attorney with Fulbright & Jaworski L.L.P.
 
Abstract:
There was, as usual, considerable trademark activity in the courts during the past year. The Supreme Court has attempted to rein in the reach of trade dress protection for product designs, and the lower courts are now grappling with the Supreme Court’s new standards. Dilution and cybersquatting also continued to be hot areas. This paper addresses these and many other issues challenging the courts over the past year.


What’s the Deal Now? A Business Perspective Analysis of the U.S. Patent System and Recent Changes to the Patent Laws
 
Citation:
10 Tex. Intell. Prop. L.J. 293 (2002)
 
Author:
John B. Campbell Jr.
 
About:
Mr. Campbell received his J.D. from The University of Texas School of Law, 2002; Master of Business Administration with a concentration in International Business, 1998, Xavier University, Cincinnati, Ohio. The author wishes to thank the Dallas office of Sidley Austin Brown & Wood LLP for their continued sponsorship of the Texas Intellectual Property Law Journal Best Note competition; Professor R. Anthony Reese at The University of Texas School of Law, and the members of his Spring 2001 Intellectual Property Law Theory Seminar for their critiques and comments on this note; the members of the Texas Intellectual Property Law Journal; Megan Harbison for her patience and support during the writing of this note; and my parents for a lifetime of support, inspiration, and encouragement.
 
Abstract:
In 1999, Congress legislated a number of changes to the patent laws. Several of these changes will be considered. First, the most significant change is that patent applications will be published eighteen months after filing. Second, inventors can receive provisional royalties from an infringer for the period from publication to issuance of the patent, assuming the patent finally issues. Last, the patent term is guaranteed to be at least seventeen years from issue if the inventor diligently pursues the prosecution of the patent application.

The goal of this note is to explore whether these changes were made in response to the measurement and correction step or due to some other motive. Regardless of Congress’ motive, this note will explore whether the changes are consistent with the goals and, therefore, the core mission. Based on this determination, suggestions will be made for better achieving the goals. Finally, the business perspective will be suggested as the appropriate theoretical framework for the United States patent system to maintain its core mission in a rapidly changing, global economy.


Issue 3 - Spring 2002


Issue Preclusion as Applied to Claim Interpretation
 
Citation:
10 Tex. Intell. Prop. L.J. 323 (2002)
 
Author:
James P. Bradley & Kelly J. Kubasta
 
About:
James P. Bradley is a Partner with the firm of Sidley Austin Brown & Wood LLP. Kelly J. Kubasta is an Associate with the firm of Sidley Austin Brown & Wood LLP. Mr. Bradley and Mr. Kubasta would also like to thank Deborah L. Lively, who drafted an earlier version of this document while she was a Summer Associate with the firm of Sidley Austin Brown & Wood LLP in 2001.
 
Abstract:
The doctrine of issue preclusion has the potential to be very important to patent litigation due to the common scenario in which a single patent is asserted in separate suits against different allegedly infringing products. For instance, a court’s claim construction of that patent in a first suit has the potential to make or break a subsequent suit if the doctrine of issue preclusion is applicable. Accordingly, the following paper addresses the doctrine of issue preclusion as it generally applies to patent law, and in particular as it applies to the issue of claim interpretation.


Open Source Licensing: Virus or Virtue?
 
Citation:
10 Tex. Intell. Prop. L.J. 349 (2002)
 
Author:
Christian H. Nadan
 
About:
Director and Associate General Counsel, Sun Microsystems, Inc., and Adjunct Professor, University of California Berkeley Boalt Hall School of Law. This Article represents the views and analysis of the author alone, and not of Sun Microsystems, Inc. The author would like to thank Bill Lard, Mark Lemley, Sean Hogle and Michele Milnes Nadan for their generous assistance and thoughtful comments and suggestions.
 
Abstract:
Although open source licensing is more than fifteen years old, it has only recently gained popular fame as well as notoriety. It has been hailed as a panacea for the ills of the technology industry, and damned as a frontal attack on free enterprise. Regardless, its proponents and critics would both agree that open source licensing—free sharing of computer software with a community of independent programmers who collaborate on the software’s development—has become an important part of the current technology industry. In the hands of a legally savvy software developer, open source licensing can be a valuable tool. Indeed, commercial enterprises are working with, incorporating and even distributing open source software, as it moves further away from its noncommercial, academic roots.

This Article examines open source licensing, its legal implications, and most critically, the use of open source licensing in the commercial context. Without a thorough understanding of open source code and licensing, those using or distributing open source code may be in for a surprise—even losing their commercial rights to their own software products. In explaining and analyzing open source licensing, this Article can also guide the practitioner wishing to add open source licensing to his or her arsenal of skills to be deployed in representing and advising technology companies.

Part I of this Article explains open source licensing—what it is and how it developed, its philosophical underpinnings, and the standard open source license agreements. This Part also analyzes the legal implications of open source licensing, including the drastic consequences to commercial enterprises that fail to employ open source licensing correctly. Understanding these risks is essential to work effectively with open source licenses and open source software. Part II explores some of the legal uncertainties in open source licensing, and failures in the standard open source license model that may undermine even a correct open source licensing program. How commercial enterprises react to open source licensing is the topic of Part III. This final part first discusses Microsoft’s response to open source licensing, and concludes by proposing a set of principles and business models for using open source licensing effectively in the commercial context—to make it serve you instead of the other way around.


Recent Developments in Patent Law
 
Citation:
10 Tex. Intell. Prop. L.J. 379 (2002)
 
Author:
Christopher G. Darrow
 
About:
J.D., cum laude, Wayne State University Law School, 2000; B.S., Chemical Engineering, Michigan State University, 1997. Currently, Mr. Darrow is an Associate at the Dallas Office of Sidley Austin Brown & Wood. Mr. Darrow will be clerking for the Honorable Paul D. Borman in the United States District Court for the Eastern District of Michigan for one year starting in September, 2002.
 
Abstract:
This Article contains recent developments in patent law from the United States Supreme Court and the United States Court of Appeals for the Federal Circuit for the year two-thousand one (2001). For brevity and maximum usefulness to the practitioner, this Article limits its discussion to recent case law that presents a novel or interesting twist to the current body of patent case law.

The past year had many developments in patent law, including the following holdings from the Supreme Court and Federal Circuit: (1) Plants are patentable subject matter under 35 U.S.C. § 101; (2) any offer for sale must rise to the level of an offer under contract law to trigger the on-sale bar of 35 U.S.C. § 102(b); (3) a patent may not be held unenforceable for litigation misconduct; (4) the 35 U.S.C. § 112 second paragraph requirement that claims be definite is a question of law that does not depend on underlying questions of fact; (5) the Federal Circuit reviews a district court’s decision of waiver of the attorney-client privilege under the abuse of discretion standard of review; (6) a settlement agreement provision promising to never challenge the validity of a patent for any reason is enforceable under the doctrine of contractual estoppel; (7) actual notice of infringement under 35 U.S.C. § 287 must come from and identify the patent owner; and (8) an appeal of attorney fees alone, unquantified in amount and unaccompanied by other issues on appeal, is not a final decision and thus not appealable until the district court quantifies the amount of attorneys fees.


 
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