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On System Of Remedies For Patent Infringement In The U.S.

Posted on:2009-10-10Degree:DoctorType:Dissertation
Country:ChinaCandidate:Y D HeFull Text:PDF
GTID:1116360272984088Subject:Civil and Commercial Law
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The U.S.is famous for its strong remedies for patent infringement, which can be shown by their astonishing damages for patent infringement. The thesis of the dissertation is whether the level of remedies for patent infringement imposed by the U.S.authorities is "proper"? If the answer is "yes",then the U.S.experience deserves comparison and reference.In deciding the standard of "proper",the dissertation come up with the normative "relative property rules",which is something between the property rules and liability rules.If the U.S.legal principles and rules are in consistant with the standard,we can say that the level of remedies for patent infringement is proper.The dissertation will use approaches including the law and ecomomics,historical meathod,case analysis,and comparative analysis,to explain and analysis the doctrines and rules of remedies for patent infringement in the U.S.Giving proper control on remedies for patent infringement is in accord with the theories of patent system.The words of U.S.Constitution article I (8) clause 8 implied that the incentive theory is the justification for patent system.The incentive theory should be the theoretical bedrock for the constraints on remedies for patent infringement.The different forms of incentive theory could be inferred to different guidelines on available remedies for patent infringement,among them is the incentive to commercializing inventions,a form of incentive theory developed in late twentieth century,which provides significant underpinnings for the constraints on remedies for patent infringement.Since the beginning of twenty-first century,the patent thicket problem has loomed large. According to the extended theory of anti-commons tragedy,the patent thicket problem roots in the "right to exclude" nature of patent,therefore constraints on remedies for patent infringement would be the legal measure for the U.S.authorities to deal with the problem.On Law and Economics,the main two important rules for protecting entitlements are property rules and liability rules,which can be regarded as a theoretical guideline to evaluate the strength of remedies for patent infringement.Analyzing the transaction costs of patent rights,It seems that we could not reach the "should be" decision to select either type of the rules to protect patent rights:property rules or liability rules.Louis Kaplow & Steven Shavell presented a new way to distinguish the two types of rules: if the entitlement is a possessory right,property rules should be referred to; if the entitlement is an externality interest,the liability rules should be referred to.According to Louis Kaplow & Steven Shavell's theory,the remedies for patent infringement should be something between the property rules and liability rules,which we call it as "relative property rules".The specific remedy rules for patent infringement do not originally in consistent with the normative "relative property rules",therefore they need legal adjustment to fulfill the goal.The part 2 of the dissertation will introduce how the U.S.authorities adjust the specific remedy rules for patent infringement,and analysis whether these adjustments constrain the remedies for patent infringement in line with "relative property rules".The two types of available remedies for patent infringement in the U.S. are equitable remedies and damages.Equitable remedies include permanent injunction,illicit profits,and temporary injunction.A "judicial compulsory license" is made when a U.S.federal court denied the permanent injunction if the infringement established.In Ebay,the Court addressed the applicability of traditional principles of equity for permanent injunction, and reversed the "general rule" that an injunction will issue when infringement has been adjudged,as the Court of Appeals for the Federal Circuits said in 1989.Ebay plays an important role in constraining the issuing of permanent injunctions.The 1946 patent law amendment repealed the remedy of illicit profits,which confused scholars very much.But we still can find that some theoretical and practical troubles faced by the courts are the main reasons to repeal.As far as the policy is concerned,the repeal reflected the authorities' inclination to constrain the remedies for patent infringement.Preliminary injunction is not only a procedural remedy but also a substantive remedy.The U.S.courts constrain the issuing of preliminary injunction by "four factors test",which includes the likelihood of success on the merits,irreparable injury,and so on.There are two types of damages award given to patent holders as a result of infringement:lost profits and reasonable royalties.The U.S.courts constrain the scope of lost profits with "but for" causation in fact,which is usually measured by the "Panduit four elements" test.In nineties of twentieth century,the Federal Circuit expanded the scope of damages in some way.In State Industries,The Federal Circuit first approved of the calculation of lost profits based on market share.In Rite-Hite,the Federal Circuit held that a patent holder might recover lost profits for a device that is not covered by the infringed patent,if that device directly competes with the infringing device.In King Instruments,the Federal Circuit expanded the scope of damages by allowing the patent holder to recover lost profits for a product that competed with the infringing product,even though the patent holder had never made or sold the patented device.On the other hand,the U.S.courts imposed proper constraints on the scope of damages. In Rite-Hite,the Federal Circuit relied on proximate cause to further the constraints on the scope of damages by the forseeability theory,and imposed the "functional unit" requirement for the Entire Market Value Rule. In BIC,the Federal Circuit added the "same market" requirement to the "Panduit four elements" test.In Grain Processing,the Federal Circuit imposed a constraint on the damages award that takes into account reasonably foreseeable actions by the infringer,and extended the area in which to find "acceptable non-infringement alternatives" of 2nd Panduit factor from product market to technology market,under which the remedies for patent infringement be close to liability rules.The calculation of damages award in U.S.courts are objective because it is required to be based on related market evidences and by the economic analysis.For example,the lost profits is computed using an incremental income approach,which scientifically reflects the true lost profits but for the infringement. Because of the proper constraints imposed by the U.S.courts on the remedies for patent infringement,its general remedy level is in consistent with the normative "relative property rules",and therefore the U.S. experience should be appreciated.By comparing the corresponding rules and doctrines between China and the U.S.,the dissertation made the following suggestions:allowing the courts to refuse "cease to infringe" remedy;transforming the "pre-litigation" injunction to "inter-litigation" injunction and examining it substantively;improving the way of calculating lost profits by interpreting the "proper profits" in the related China Supreme Court's regulation as marginal profit to increase the amounts of lost profits;decreasing the application of statutory damages in order to lower the irregularity of judgments.
Keywords/Search Tags:patent, infringement, remedy, injunction, damages
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