IPR and Competition Law Regime: Towards a Common Goal

Ashwini Siwal, Assistant Professor, Faculty of Law, University of Delhi.

  1. AYN RAND, Capitalism: The Unknown Ideal (New York, New American Library, 1966) at p.128 []
  2. See for a historical background CARLA HESSE “The Rise of Intellectual Property: 700 B.C. to A.D. 2000: An Idea in Balance” Daedalus (Spring, 2002): 26-45. For a preliminary general overview of the historical evolution of see F. PRAGER, A History of Intellectual Property from 1545 to 1787, J. Pat. Off. Soc., 1944,711;B. SHERMAN & L. BENTLEY, The Making of Modern Intellectual Property Law, Cambidge,1944. []
  3. Refer to p.2, Intellectual Property Law, ed. DR. AMEE-MARIE MOONEY COTTER, Law Society of Ireland, Cavendish Publishing ltd. (2003). []
  4. LESTER C. THEROW, NEEDED A NEW SYSTEM OF INTELLECTUAL PROPERTY RIGHTS, Harvard Business,  Sept-Oct., 1997 p.95-103. []
  5. See SHAHID ALIKHAN & RAGHUNATH MASHELKAR, Intellectual Property and Competitive Strategies in the 21st Century, 2004 Kluwer Law International, Aditya Books (2006) at p.31; KITCH EDMUND W., The Nature and Function of Patent System, Journal of law & Economics, 20 (1977), 265. Further see Integrating IPR’s and Development Policy,REPORT OF THE COMMISSION ON IPR’S, London, September 2002. also see M. McFARLAND, Intellectual Property, Information, and the Common Good, (1999) BCIntell.prop.& Tech. F 060503.See also MONROE E. PRICE, The Newness of New Technology, Cardozo Law Rev.,Vol.22,July 2001, No.5-6 at p.1885.See also Z Grilliches, Patent Statistics as Economic Indicators, 28 J. Econ. Literature28 (1990) at 1661-1707. []
  6. See, The Collected Works of Abraham Lincoln(1953);356-63.as quoted in HARVEY E. BALE, Pharmaceutical Access and Innovation: Challenges and Issues, 42 DEVELOPMENTAL REV. 84, 84(1999). []
  7. A similar argument was given by JOHN STUART MILLS in Principles of Political Economy, Book V, Ch. X, s.4 []
  8. see DR. EDWIN H. LAND, The Role Of Patents In The Growth Of New Companies, at the Annual Dinner of the Boston Patent Law Association on April2, 1959. []
  9. Protecting the right to receive benefits GOTTHOLD LESSING, one of the greatest writer of German Enlightenment argued that “ …..freely hast thou received, freely thou must give! Thus thought the noble Luther…Luther, I answer is an exception in many things.” In his 1772 essay “ LIVE AND LET LIVE”. For a detailed study refer to CARLA HESSEThe Rise of Intellectual Property: 700 B.C. to A.D. 2000: An Idea in Balance” Daedalus (Spring, 2002): 26-45 IP SPURS INNOVATION, ARROW KENNETH , Economics, Welfare and the Allocation of Resources for Invention in INVENTION, GROWTH AND WELFARE: A THEOROTICAL TREATMENT OF TECHNOLOGICAL CHANGE, Ed. By NELSON R. (MIT PRESS,  CAMBRIDGE, MA ), 1969. []
  10. See p.23 Introduction in TINA HART & LINDA FAZZANI, Intellectual property Law, 3rd ed. Palgrave, MacMillan (2004); HORACIO SPECTOR, IP SKEPTICISM, INTELLECTUAL PROPERTY,at p.539-42 in PETER D. , The International Library of Essays on Law and Legal Theory,, II nd. Series, DARTHMOUTH (1999), further see ROBETT LANDENSON, “ free expression in the corporate workplace” in Ethical Theory and Businesses 2nd Ed., Ed. By T. Beauchamp & N. Biwis (Englewood cliffs, N.J.: Prentice-Hall,1983) pp162-69. []
  11. For an up-to-date distinction between two approaches refer to JOSEPH RAZ, The Morality of Freedom, Clarendon Press, 1986, ch.11. []
  12. Refer to JOHN LOCKE, “THE SECOND TREATISE”, sec.27 (at 305-06) in TWO TREATISE OF GOVERNMENT, ed by PETER LASLETT, Cambridge University Press, 1970. the approaches are also apparent in the ARTICLE 27(2) of the U.D.H.R., 1948 when it provides that, “Everyone has the right to the protection of the moral and material interests resulting from any scientific, literary or artistic production of which he is the author” and to the same effect is the all-embracing definition of IP in The Convention Establishing The WIPO, 1967. The other deontological justification is identifying the personality through its external manifestations which JOSEPH KOHLER derived from OTTO VON GIERKE, who deemed it from HEGEL, who found it from KANT. See the point given by GEORG WILHELM FRIEDRICH HEGEL, POLITICAL WRITINGS 102-06. []
  13. The Lockean themes of natural rights in modern IP scholarship can be seen in JUSTIN HUGHES, The Philosophy of Intellectual Property” , 77 Geo. L.J. 287(1988); the resonance of the Lockean thought were seen in the writings of  EDWARD YOUNG in CONJECTURES ON ORIGINAL COMPOSITION(1759) and in the  argument of illustrated encyclopedist DENIS DIDERROT in 1763 when he remarked that “ what form of wealth could belong to man, if not the work of his mind…if not his own thoughts …the most precious part of himself that will never perish, that will immortalize him?” he argued that products of mind are more uniquely the property of the man than land acquired through its cultivation . for further details refer to CARLA HESSEThe Rise of Intellectual Property: 700 B.C. to A.D. 2000: An Idea in Balance” Daedalus (Spring, 2002): 26-45; also see ROSCOE POUND, Outlines of Jurisprudence in Social Dimensions of Law by JULIUS STONE , Ist Indian reprint (Universal, New Delhi), 1999, p.168. []
  14. For an E.g. of the proviso being satisfied in case of patents refer to ROBERT NOZICK, Anarchy, State, and Utopia, Basil Blackwell, 1974 at 181-82. []
  15. See, EDWIN C. HETTINGER (1989), ‘Justifying Intellectual Property’ Philosophy and Public Affairs, 18, pp. 31-52. []
  16. EDWIN C. HETTINGER, JUSTIFYING INTELLECTUAL PROPERTY, Philosophy And Public Affairs-18 pp.31-52; PETER KARLEM,WORLD MAKING: PROPERTY RIGHTS IN AESTHETIC CREATIONS (1986) 45 Jo. Of Aesthetics and Art Criticism 183, at p. 185. []
  17. See MICHAEL LEHMANN, ‘The Theory of Property Rights and the Protection of Intellectual and Industrial Property’, IIC 16 (1985). []
  18. For detailed study refer to HORACIO M. SPECTOR, An Outline of a Theory Justifying Intellectual and Industrial Property Rights, European Intellectual Property Review 11 (1989). For justifications behind patents, copyright and trademarks refer to CATHERINE COLSTON & KIRSTY MIDDLETON, Modern Intellectual Property Law, second ed., Cavendish Publishing (2005) at p.43-54; IPR are economically and politically significant in the course of the R&D, or in the course of marketing, business and the economic side of things as argued by DUTFIELD GRAHAM(ed.), Intellectual Property Rights: Driver of Competition and Growth or Unnecessary Constraint ? A Report of a conference held on 16 and 17 June 2003, Royal Institute of International Affairs, 2003. []
  19. 21see ROBERT STONER, Presentation at FTC/DOJ Hearings on Competition and Intellectual Property Law and Policy in the Knowledge-based Economy, Intellectual Property and Innovation (FTC/DOJ, Feb. 26, 2002)http://www.ftc.gov/opp/intellect .(last visited on 18th September, 2008. ); also see GUSTAVO GHIDINI…… []
  20. See JEREMY BENTHAM, A Manual of Political Economy 71 (John Bowring ed., 1839); CLARK, Essentials of Economic Theory 360-61; JOHN STUART MILL, Principles in Political Economy with some of Their Applicatios to Social Philosophy, ch.2*6,for details refer to CARLA HESSEThe Rise of Intellectual Property: 700 B.C. to A.D. 2000: An Idea in Balance” Daedalus (Spring, 2002): 26-45 []
  21. See WHITE V SAMSUNG ELECTRONICS AMERICA, INC. 989 F. 2d 1512,1513 (9th Cir., 1993); further see LAWRENCE A. SULLIVAN, Is Competition Policy Possible in High Tech Markets? : An Inquiry into Antitrust, Intellectual Property and Broadband Regulations as applied to the “NEW ECONOMY”, Case Western Law Review Vol.52, Fall 2001, No. 1 at p.62. []
  22. See ROBERT PITOFSKY, Antitrust and Intellectual Property: Unresolved Issues at the Heart of the New Economy, Speech At The Univ. of California, Berkley <http://www.ftc.gov/speeches/pitofsky/ipf301.htm.>(last visited 18th September, 2008.). []
  23. See JAMES LANGENFELD; Intellectual Property And Antitrust Step Towards Striking A Balance. Case Western Law Review Vol.52 Fall 2001, No.1 at p.97-98..see also JAMES B. KOBAK, JR., Intellectual property, Competition Law and Hidden Choices Between Original and Sequential Innovation, 3 Va. J.l.&Tech.6(1998); WILLIAM LANDES & RICHARD POSNER, An Economic Analysis of Copyright Law 18 J. Legal Studies 325,326 (1989). []
  24. See JAMES BOYLE, Symposium: Taking Stock: The Law and Economics of Intellectual Property Rights: Cruel, Mean,or Lavish? Economic Analysis, Price Discrimination and Digital Intellectual Property, 53 Vand. L. Rev. 2007,2013(2000). []
  25. care must be taken as not to allow… [IP law] to be made instruments of oppression and extortion” in UNIVERSITY OF LONDON PRESS LTD. V UNIVERSITY TUTORIAL PRESS LTD. (1916) 2 Ch.601,610 (Eng.). []
  26. For a detailed study of impact of IP protection on consumer welfare and innovation see JAMES LANGENFELD; Intellectual Property and Antitrust Step Towards Striking a Balance. Case Western Law Review Vol.52 Fall 2001, No.1, Also see KEITH E. MASKUS & JEROME H. REICHMAN, The Globalization of Public Goods and the Privatization of Global Public Goods, Cambridge Univ. Press, 2005. []
  27. LORD MANSFIELD in SAYRE V MOORE (1785) 1 East 361 n.,102 E.R. 139n. []
  28. AMATO GIULIANO, Antitrust and the Bonds of Power 2 (Hart Publishing, Oxford), 1997; PITOFSKY ROBERT, The Political Context of Antitrust, University of Pennsylvania Law Review, 127(1979),1051 []
  29. SPECTRUM SPORTS, INC. V MCQUILLEN ,506 US 447(1993). []
  30. See generally ROBERT PITOFSKY, CHALLENGES OF THE NEW ECONOMY: ISSUES AT THE INTERSECTION OF ANTITRUST AND INTELLECTUAL PROPERTY, Antitrust law journal, 69(2000) 913; HOBERT HOVENKAMP ,Federal Antitrust Policy: The Law of Competition and its Practice 3 (West,1994). At p.17 []
  31. See UNITED STATES V ALUMINIUM CO OF AM. 148 F. 2d. 416, 427 (2d. Cir. 1945); LE PAGES INC. V 3M. 324 F 3d. 141,147 (3rd Cir.(pa) 25 mar. 2003). []
  32. DAVID A. BALTO & ANDRE M. WOLMAN, Intellectual Property & Antitrust: General Principles IDEA- The Journal of Law and Technology,Vol.43, No.3, 2003, at p.398. []
  33. LANDE ROBERT H. , Wealth transfer as the original and primary concern of antitrust: the efficiency interpretation challenged, Hastings Law Journal, 34(1982)65. []
  34. See MICHAEL E. PORTER, The Competitive Advantage of Nations 662-64 (The Free Press, 1990) ; also see  JAMES LANGENFELD; Intellectual Property And Antitrust Step Towards Striking A Balance. Case Western Law Review Vol.52 Fall 2001, No.1 at p.92. []
  35. For e.g. see CONTINENTAL TV INC. V GTE SYLVAN INC., 433 US 36(1977); GREEN COUNTRY FOOD MARKET, INC. V BOTTLING GROUP LLC, 371,F3d 1275,1281(10TH CIR.OKLA.); PARK V THOMSON CORP., 2007WL119461(SDNY 11 Jan., 2007). []
  36. See generally HOBERT HOVENKAMP , Federal Antitrust Policy: The Law of Competition and its Practice 3 (West,1994). []
  37. See PHILIP E. AREEDA & HERBERT HOVENKAMP, ANTITRUST LAW: AN ANALYSIS OF ANTITRUST PRINCIPLES AND THEIR APPLICATION Vol. II A Rev. Ed. (1997). []
  38. STANDARD OIL CO. V FTC ,340 US 231,249(1951). []
  39. For a detailed background of the development in Europe, America & England refer to MARK FURSE, Competition Law of the UK & EC (Blackstone Press Ltd., 1999) pp. 2-6. []
  40. For other harms refer to MARK FURSE, Competition Law of the UK & EC (Blackstone Press Ltd., 1999) pp.6-9. []
  41. See MICHAEL A. CARRIER, Unraveling the Patent-Antitrust Paradox, 150 U.Pa. L.Rev. 761 (Jan., 2002);  WILLIAM F. BAXTER , Antitrust Law and Technological Innovation, Issues Sci. & Tech., Winter 1985, at 80,82. []
  42. See RICHARD N. LANGLOIS, “Schumpeter and the Obsolescence of the Entrepreneur”, Paper presented at the History Of Economics Society, Deptt. Of Economics, The Univ. of Connecticut, U63 Storrs,CT 06269-1063,1987. also see KEWANEE OIL CO. V BICRON CORP. 416 US 470 (1970); BISHWANATH PRASAD RADHEY SHYAM V HINDUSTAN METAL INDUSTRIES MANU/SC/0255/1978. []
  43. JOSEPH A. SCHUMPETER, Capitalism, Socialism and Democracy 100-06 (3d. Ed., Harper & Row 1950).this theory was further expanded by EDMUND W. KITCH , The Nature and Function of the Patent System, 20 J.L.& Econ. 265, 276 (1977)as that the patent rights which confer a economic  monopoly are beneficial for two reasons. First, they provide developmental incentives by allowing full gain and benefits of such development  and , secondly, early and broad patent rights would allow coordination of developmental efforts, which would decrease the duplicative investments in development.). []
  44. SEE KENNETH J. ARROW, Economic Welfare and the Allocation of Resources for Innovation, in The Rate and Direction of Inventive Activity: Economic and Social Factors 609-25 (Natl. Bureau of Econ. Research ed., 1962). []
  45. REBECCA EISENBERG, 56 U. Chi. L. Rev. 1017, 1063-64 (1999) (cited ROBERT K. MERTON, The Sociology of Science 378-80 (Chicago 1973)). []
  46. See, MICHAEL E. PORTER, The Competitive Advantage of Nations, 662-64 (The Free Press, 1990). []
  47. see ALDEN F. ABOTT & SUZANNE T. MICHEL in The Right Balance of Competition Policy and Intellectual Property Law: A Perspective on Settlement of Pharmaceutical Patent Litigation, IDEA, The Intellectual Property Law Review, Vol. 46, No.1, 2005; WARD S. BOWMAN JR., Patent & Antitrust law: A Legal & Economic Appraisal(1973) that “both antitrust and patent law have a common central goal: to maximize wealth by producing what consumers want at the lowest cost”; WILLIAM F. BAXTER, Legal Restrictions on Exploitation of the Patent Monopoly: An Economic Analysis, 76 Yale L..J. 267,275 (1966);  SCM CORP. V XEROX CORP. 645 F.2d 1195,1203 (2d Cir. 1981)(“ while the antitrust laws proscribe unreasonable restraints of competition, the patent laws reward the inventor with a temporary monopoly that insulates him from competitive exploitation of his patented art .”); also see WALKER PROCESS EQUIP., INC. V FOOD MACH. & CHEM. CORP., 382 U.S. 172,177 (1965).the conflict can be seen in following cases IMAGE TECHNICAL SERVICES INC. V EASTMAN KODAK CO. 125 F. 3d.1195 (9TH Cir. 1997);IN RE INDEPENDENT SERVICE ORGANIZATION ANTITRUST LITIGATION(XEROX) 203 F. 3d. 1322 (fed. Cir. 2000);CSU V XEROX CORP. 131 S. Ct. 1077(2001); INTELGRAPH CORP. V INTEL COORP. 195 F.3d. 1346,1358-59 (Fed.Cir. 1999)NOBEL PHARMA AB V IMPLANT INNOVATIONS, INC., 141 F. 3d. 1059,1069 (Fed. Cir. 1998) ;CR BOARD, INC. V M3 SYSTEMS, INC.157 F.3d. 1340 (Fed. Cir. 1998). []
  48. As argued by ALDEN F. ABOTT & SUZANNE T. MICHEL in The Right Balance of Competition Policy and Intellectual Property Law: A Perspective on Settlement of Pharmaceutical Patent Litigation, IDEA, The Intellectual Property Law Review, Vol. 46, No.1, 2005 that , “IP do not confer monopoly power in the economic sense, and in the past, antitrust law often did more to create artificial impediments to efficient business transactions than to correct monopolistic interferences with the efficient business transactions.” []
  49. As KAPLOW puts it,”A practice is typically deemed to violate the antitrust laws because it is anticompetitive. But the very purpose of the patent grant is to reward the patentee by by limiting competition, in full recognition that the monopolistic evils are the price society will pay.” Extension of Monopoly through Leverage”, Columbia Law Review, 85 (1985):515. []
  50. See generally, CHRISTOPHER MAY, The Venitan Movement: New Technologies, Legal Innovation and the Institutional Origins of Intellectual property; p.7-30 in the Intellectual Property Rights, Critical Concepts in Law, Vol. III Ed. By: DAVID VAVER , Routeledge, (2006). []
  51. LOCTITE CORP. V ULTRASEAL LTD., 781 F 2d 861, 228 USPQ 90 (Fed. Cir. 1985)ATARI GAMES CORP. V NINTENDO OF AMERICA, INC.,897 F. 2d 1572, 14 USPQ2d 1034 (Fed. Cir. 1990). []
  52. ALDEN F. ABBOTT & SUZANNE T. MICHEL, The Right Balance of Competition Policy and Intellectual Property Law: A Perspective on Settlements of Pharmaceutical Patent Litigation, IDEA, The Intellectual Property Law Review Vol.46, No. 1 , 2005 at p.2. []
  53. See the FEDERAL TRADE COMMISSION, To Promote Innovation: The Proper Balance of Competition and Patent Law and Policy,http://www.ftc.gov/os/2003/10/innovationrpt.pdf (accessed on 18th Sept. 2008). []
  54. THOMAS M. JORDE & DAVID J. T. , Rule of Reason Analysis of Horizontal Agreements: Agreements desired to Advance Innovations and Commercialize Technologies, 61 ANTITRUST L.J. 579;581-83 (1993). []
  55. For a brief historical background refer to WILLIAM H. FRANCES & ROBER C. COLLINS, Cases and Materials on Patent Law including Trade Secrets-Copyrights-Trademarks, Fourth Ed., West Pub. Co., St. Paul, Minn. 1995 p.64-80 []
  56. .For eg. CHAMBERLIN(1937), SCHERER(1984),SOTCHMER(1991) express not dissimilar concerns about dissimilar concerns about the anticompetitive effects generated by a system of patents, see GUSTAVO GHIDINI…..at p.13. []
  57. see CORWIN & LLEWELYN, Intellectual Property: Patents, Copyright, Trademarks, and Alied Right Fifth Ed. Thomson & Maxwell , 2003 ; also see SCHENCK, A.G. V NORTON CORP. ,713 f.2d782, 218 USPQ2d 698 (Fed. Cir. 1983.) ; JAMESBURY CORP. V LITTON INDUS. PRODS., INC., 756 f.2D 1556, 255uspq 253 (Fed. Cir. 1985); ABOTT LABS. V BRENNAN, 952 F. 2d 1346, 21 USPQ 253 (Fed. CIr. 1992); LOCTITE CORP. V ULTRASEAL LTD., F.2d 861, 228 USPQ 90 (Fed. Cir. 1985). []
  58. ATARI GAMES CORP. V  NINTENDO OF AMERICA, INC., 897 F 2d. 1572, 14 USPQ2d 1034(Fed. Cir.1990).market power acquired through “superior skill, foresight, and industry”, should not be condemned, although the anticompetitive exercise of this may be prevented, UNITED STATES V. ALUMINIUM COMPANY OF AMERICA, 148 F.2d 416 (2d cir.1945). []
  59. see JAMES LANGENFELD & DAVID S., Innovation and U.S. Competition Policy, 34 Antitrust Bull. 1, 1-3 (1989). []
  60. see GUSTAVO GHIDINI,INTELLECTUAL PROPERTY AND COMPETITION LAW the innovation nexus, (EE PUB., UK, 2006) AT P.102 []
  61. see T. VINJE, MAGILE: Its Implication on the Information Technology Industry,14 EIPR, 1992,397. []
  62. see LOCTITE CORP. V ULTRAWEAL CORP. 781 F. 2d. 861, 876-877, 228USPQ 90 (Fed. Cir. 1985). []
  63. see W. NORDHAUS, Invention, Growth and welfare: A Theoretical Treatment of Technological  Change,Cambridge: MIT Press, 1969; also W. BOWMAN, Patent and Antitrust Law: A Legal and Economic Appraisal, Chicago: University of Chicago Press,1973; W. BAXTER, “Legal Restrictions on the Exploitation of the Patent Monopoly: An Economic Analysis,” Yale Law Journal, 76 (1966): 267. []
  64. see R. BARRO, “Economic Growth in Cross-section of Countries,” Quarterly Journal of Economics, 106(2) (May 1991): 407-444 []
  65. As reflected in ARTICLE 27 of the UNIVERSAL DECLERATION OF HUMAN RIGHTS, 1948, that “Everyone has the right to the protection of the moral and material interests resulting from any scientific, literary or artistic production of which he is the author” and further that “ everyone has the right…to share in scientific achievements and its benefits.” []
  66. See PROF. ANIL GUPTA on http://www.wipo.org/tk/en/publications/769e_unep_tk.pdf []