Sunday, April 02, 2006


Patent injunctions

The recent patent-infringement cases involving Research in Motion and eBay have brought patent issues to many people's attention. I'm not interested in going into the specifics of the patents and claims in these cases, but would like to comment on the question, highlighted in the eBay case but present in both, of injunctions. (I should make a particular point of noting that my employer is very big on patents, and that what I say here has nothing to do with the company's thoughts on the matter.)

The issue is this: the court has decided that company X infringes on company Y's patent. As part of the process, the judge now issues an injunction forbidding company X from continuing to do that. Meanwhile, they're all deciding how much money should change hands, settling on licensing, and so on. And that may be fine if company Y is also selling the product or service, and the judge has stopped company X from illegally competing with it while they sort out the terms. But suppose company Y is not selling it. Suppose company Y is not selling anything.

There are companies that are just parking patents and waiting for someone to violate them (sometimes knowingly, but often not; knowingly infringing on a parent carries treble damages), but they do not, themselves intend to use the technology they've patented. Even if they do intend to use it, they might not now be doing so. In this case, company X is not depriving company Y of any revenue, and their continued use of the patented technology causes company Y no further harm. Moreover, if (as in the RIM case) consumers have no way to switch to another provider, the injunction will cause significant damage to the innocent public.

It's in these cases that I believe the injunction does far more harm than good, and judges should not issue such injunctions. Specifically, judges should only issue injunctions when the continued use by the defendant causes the plaintiff further harm. In any case, when an agreement is reached (or penalty imposed by the court), the plaintiff will be compensated for the use of the patent.

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