PATENTLY UNCERTAIN

Innovation is an inherently uncertain process. Success is typically coupled with risk and we can only hope that those with great ideas will persevere. To encourage innovation, society reduces some of the innovation risk through structures like funding systems, regulation, and of course intellectual property rights. But what happens when uncertainty strikes the legal protection devices themselves? Faced with unclear rules and increasingly speculative rewards, some innovators may simply stop playing the game. Such uncertainty has recently been a topic of great concern in the U.S. patent system. Some believe that the suddenly unknowable nature of fundamental questions like what is patentable has had the effect of dramatically undermining legal incentives. Others question whether a crisis really exists. They point out that uncertainty can have positive effects, and even, be a source of strategic advantage. How can we tell good uncertainty from bad? This article provides a novel framework for evaluating patent uncertainty that explains how complaints and complacency can exist contemporaneously. It draws on the behavioral economics literature to provide a deeper understanding of how innovators react to unknown legal environments. Based on this analysis, the article identifies three different types of legal uncertainty: (1) investment-killing; (2) if-then; and (3) remedial uncertainly. It asserts that only the first creates a problem that must be addressed by legal reform, while the others are actually essential to a healthy innovation system. The article concludes with specific prescriptions for addressing negative uncertainty that depend on both firm and policymaker action

Breaking Patents

In the 1970s and 1980s, the Boeing aircraft company worked to address the rising cost of jet fuel by inventing lighter metal alloys for use in aerospace materials. Among its discoveries was a method of producing aluminum-lithium alloys with high fracture toughness, and in 1989, Boeing received a patent for the process. Five years later, another aerospace company working as a National Aeronautics and Space Administration (NASA) contractor, Lockheed Martin, was attempting to solve a similar problem related to materials used in the space shuttle. Lighter materials were necessary for future shuttle missions to transport components of the International Space Station. Lockheed Martin independently discovered the same method that Boeing had patented, and Lockheed Martin used it to lighten the shuttle\u27s external fuel tank. When Boeing discovered the unauthorized use of its patented method, it sued the U.S. government and won a judgment of patent infringement in 2006. Because U.S. law does not allow patent injunctions against the government, Boeing must settle for damages, which will likely be a reasonable royalty. Boeing\u27s legal dispute with the U.S. government may seem uncontroversial-even mundane-but it is an example of one of the most contentious legal mechanisms in international law: a patent compulsory license, which is colloquially referred to as breaking a patent. True, Boeing\u27s case does not involve humanitarian suffering or pit an international conglomerate against a developing nation. It\u27s just business. But that is exactly the point. The Boeing case demonstrates that the patent breaking mechanism can have relatively common applications, and its imposition by the U.S. government is evidence that even developed, intellectual property rights-centric nations are willing participants in the system. Such a case requires a cogent legal structure to ensure the government does not inequitably diminish Boeing\u27s established rights. However, in most academic and political debates, contexts like those encompassing the Boeing case are ignored. The analysis has primarily focused on a few (albeit important) contexts, particularly access to medicines. The problem with this approach is that it has left us with a broader international regime that is understudied, vague, unpredictable, and not useful when it really counts. A more comprehensive assessment is necessary to understand how the mechanism of patent breaking should be applied efficiently across all of its possible non-remedial contexts

Medical Product Information Incentives and the Transparency Paradox

Recent allegations that essential safety and efficacy information is often suppressed by medical product manufacturers or poorly evaluated by regulators have led to calls for greater information transparency. The public is justifiably concerned that its ability to conduct an informed risk-benefit assessment of drugs and medical devices is compromised. Several changes have already been made to federal regulatory law and medical research policy to mandate greater disclosure and more changes are being considered. However, it is possible that these measures may backfire by enhancing significant tort-based economic disincentives for generating new information.I n other words, greater disclosure requirements could, paradoxically, lead to less information production. The resulting shortfall could be extremely dangerous and have a detrimental effect on health care for years to come. This Article addresses the crisis on the horizon and proposes a unique solution that connects tort law disincentives to information production incentives. It explains why an economically rational company would be expected to respond to transparency with less information and proposes a tort liability limitation as a solution that will encourage a cost-internalizing company to increase information production. This Article also considers the impact of the FDA\u27s recent position on preemption along with other regulatory enhancements and concludes that these are effective, but second-best solutions

Medical Product Information Incentives and the Transparency Paradox

Recent allegations that essential safety and efficacy information is often suppressed by medical product manufacturers or poorly evaluated by regulators have led to calls for greater information transparency. The public is justifiably concerned that its ability to conduct an informed risk-benefit assessment of drugs and medical devices is compromised. Several changes have already been made to federal regulatory law and medical research policy to mandate greater disclosure and more changes are being considered. However, it is possible that these measures may backfire by enhancing significant tort-based economic disincentives for generating new information.I n other words, greater disclosure requirements could, paradoxically, lead to less information production. The resulting shortfall could be extremely dangerous and have a detrimental effect on health care for years to come. This Article addresses the crisis on the horizon and proposes a unique solution that connects tort law disincentives to information production incentives. It explains why an economically rational company would be expected to respond to transparency with less information and proposes a tort liability limitation as a solution that will encourage a cost-internalizing company to increase information production. This Article also considers the impact of the FDA\u27s recent position on preemption along with other regulatory enhancements and concludes that these are effective, but second-best solutions

Breaking Patents

In the 1970s and 1980s, the Boeing aircraft company worked to address the rising cost of jet fuel by inventing lighter metal alloys for use in aerospace materials. Among its discoveries was a method of producing aluminum-lithium alloys with high fracture toughness, and in 1989, Boeing received a patent for the process. Five years later, another aerospace company working as a National Aeronautics and Space Administration (NASA) contractor, Lockheed Martin, was attempting to solve a similar problem related to materials used in the space shuttle. Lighter materials were necessary for future shuttle missions to transport components of the International Space Station. Lockheed Martin independently discovered the same method that Boeing had patented, and Lockheed Martin used it to lighten the shuttle\u27s external fuel tank. When Boeing discovered the unauthorized use of its patented method, it sued the U.S. government and won a judgment of patent infringement in 2006. Because U.S. law does not allow patent injunctions against the government, Boeing must settle for damages, which will likely be a reasonable royalty. Boeing\u27s legal dispute with the U.S. government may seem uncontroversial-even mundane-but it is an example of one of the most contentious legal mechanisms in international law: a patent compulsory license, which is colloquially referred to as breaking a patent. True, Boeing\u27s case does not involve humanitarian suffering or pit an international conglomerate against a developing nation. It\u27s just business. But that is exactly the point. The Boeing case demonstrates that the patent breaking mechanism can have relatively common applications, and its imposition by the U.S. government is evidence that even developed, intellectual property rights-centric nations are willing participants in the system. Such a case requires a cogent legal structure to ensure the government does not inequitably diminish Boeing\u27s established rights. However, in most academic and political debates, contexts like those encompassing the Boeing case are ignored. The analysis has primarily focused on a few (albeit important) contexts, particularly access to medicines. The problem with this approach is that it has left us with a broader international regime that is understudied, vague, unpredictable, and not useful when it really counts. A more comprehensive assessment is necessary to understand how the mechanism of patent breaking should be applied efficiently across all of its possible non-remedial contexts

Trademark\u27s Grip over Sustainability

Entrepreneurs and larger firms are waking up to the fact that there is a viable market for recycled, repaired, and even upcycled goods. There is also an increasing desire on the consumer end for more sustainable products as well as measures to reduce landfill and other product disposal harms to the environment. Although some legal barriers to this new market are being actively debated, other barriers have taken a back seat and seem primed to surge only when increased business activity exposes the liability. This is the case with trademark law, which has the potential to substantially deter the small-firm and nonprofit actors that will likely lead this aspect of used-good evergreening. This Article investigates emergent trademark barriers that have been substantially overlooked in the current discussion regarding product renewal, which has largely been concerned with the right to repair. It considers the surprising power that the doctrines of post-sale confusion, dilution, and repair-orreconstruction possess to thwart legitimate and sustainable business activity. After reviewing the literature demonstrating that most confusion based on such legal theories is not harmful, this Article proposes some simple modifications to the current rules that would reduce uncertainty. It concludes that sustainable product lifecycles can be better supported when trademark barriers are reduced. Such a change would provide consumers with a more robust path to counter our disposable world