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Wallace's Memorandum on Summary Judgment | 17 comments (17 topical, editorial, 3 hidden)
Re: Wallace's Memorandum on Summary Judgment (3.66 / 6) (#3)
by codswallet on Mon Jun 13th, 2005 at 21:44:43 EST
(User Info)
Mechanical application of per se rules to price fixing in patent and copyright licensing appears to have no support in the case law. It is at least necessary to determine whether the licensor's actions are outside the scope protected by statute. There is some question whether once such a finding has been made, per se treatment becomes possible or whether the scope determination can only be done in the context of the antitrust aspects of the offense. To me, the logical conclusion is that it depends upon the nature of the offense. For instance if the licensor's actions would have been misuse even if the antitrust laws didn't exist, then surely he has no right to depend on their umbrella. Likewise as in Simpson v, Union Oil, even though the court agrees that the actions are protected in theory if performed by the rights holder, it may decide that control had passed to others, and the actions were mandated upon them. This would also be outside the scope, even though downstream restrictions aren't necessarily misuse.

However, the issue of derivative works and the grantable right to distribute add elements that aren't present in other cases. What is in question is not just the resale of copyrighted works, but the assignment of new rights to distribute and create derivative works. These rights are not necessary to the transfer of the work or the resale of it. In fact, if the GPL code is distributed with source and executable on different disks, selling the purchased copy of the executable alone is probably not a violation of the license. Since this could in turn resold, this example is closest to the decided cases, which suggests that they are not entirely on point.


[I]n passing the Copyright Act, Congress itself made an empirical assumption that allowing copyright holders to collect license fees and exclude others from using their works creates a system of incentives that promotes consumer welfare in the long term by encouraging investment in the creation of desirable artistic and functional works of expression . . . We cannot require antitrust defendants to prove and reprove the merits of this legislative assumption in every case where a refusal to license a copyrighted work comes under attack.  Data General Corp. v. Grumman Systems Support Corp. 36 F.3d 1147, 1186-87 (1st Cir. 1994).


The patent laws which give a 17-year monopoly on "making, using, or selling the invention" are in pari materia with the antitrust laws and modify them pro tanto. That was the ratio decidendi of the General Electric case. See 272 U.S., at 485 . We decline the invitation to extend it. SIMPSON v. UNION OIL CO., 377 U.S. 13, 24 (1964)


But under the patent law the patentee is given by statute a monopoly of making, using and selling the patented article. The extent of his monopoly in the articles sold and in the territory of the United States where sold is not limited in the grant of his patent, and the comprehensiveness of his control of the business in the sale of the patented article is not necessarily an indication of illegality of his method. As long as he makes no effort to fasten upon ownership of the articles, he  sells control of the prices at which his purchaser shall sell, it makes no difference how widespread his monopoly. It is only when he adopts a combination with others, by which he steps out of the scope of his patent rights and seeks to control and restrain those be whom he has sold his patented articles in their subsequent disposition of what is theirs, that he comes within the operation of the Anti-Trust Act. UNITED STATES v. GENERAL ELECTRIC CO.  272 U.S. 476



Wallace's Memorandum on Summary Judgment | 17 comments (17 topical, 0 editorial, 3 hidden)
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