Against settlement of (some) patent cases

Vanderbilt Law Review

Volumn 67, Issue 2, 2014, Pages 375-441

  La Belle, Megan M ^a  

^a CATHOLIC UNIVERSITY OF AMERICA   (United States)

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EID: 84891065906     PISSN: 00422533     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Review

References (419)

1. James Bessen & Michael J. Meurer, Lessons for Patent Policy from Empirical Research on Patent Litigation, 9 LEWIS & CLARK L. REV. 1, 2 (2005).
2. Colleen V. Chien, Of Trolls, Davids, Goliaths, and Kings: Narratives and Evidence in the Litigation of High-Tech Patents, 87 N. C. L. REV. 1571, 1573 (2009).
3. See Jay P. Kesan & Gwendolyn G. Ball, How Are Patent Cases Resolved? An Empirical Examination of the Adjudication and Settlement of Patent Disputes, 84 WASH. U. L. REV. 237, 272 & n. 216, 273-74 (2006) (finding that 65% of patent cases "definitively or probably" settled in 1995 and that 68% of such cases "definitively or probably" settled in 2000);
4. see also Marc Galanter & Mia Cahill, "Most Cases Settle": Judicial Promotion and Regulation of Settlements, 46 STAN. L. REV. 1339, 1340 (1994) (estimating that two-thirds of all civil suits settle).
5. See Marc Galanter & Angela Frozena, The Continuing Decline of Civil Trials in American Courts 3 (2011) (paper presented at Pound Civil Justice Institute 2011 Forum for State Appellate Court Judges), available at http://perma.cc/U3J8-U7HD (finding that 11-12% of federal cases were terminated during or after trial during the 1960s, compared to the 1% of cases terminated in such a manner in 2010).
6. ADMIN. OFFICE OF THE U. S. COURTS, JUDICIAL BUSINESS OF THE U. S. COURTS, 2011 ANNUAL REPORT OF THE DIRECTOR 15(2012), available at http://perma.cc/DR5V- LLQH, (indicating that federal courts disposed of 303, 158 civil cases in 2011);
7. Marc Galanter, The Vanishing Trial: An Examination of Trials and Related Matters in Federal and State Courts, 1 J. EMPIRICAL L. STUD. 459, 462-63 (2004) (indicating that U. S. district courts disposed of 50, 320 civil matters in 1962).
8. ADMIN. OFFICE OF THE U. S. COURTS, supra note 6, at 20 (indicating that there were 5, 357 federal civil trials in 2011);
9. Leahy-Smith America Invents Act, Pub. L. No. 112-29, 125 Stat. 284 (2011)
10. (codified as amended at 35 U. S. C. (2012)).
11. See Robert P. Merges, Priority and Novelty Under the AIA, 27 BERKELEY TECH. L. J. 1023, 1046 (2012).
12. John R. Allison et al., Patent Quality and Settlement Among Repeat Patent Litigants, 99 GEO. L. J. 677, 689 (2011).
13. See, e.g., Michael A. Carrier, Unsettling Drug Patent Settlements: A Framework for Presumptive Illegality, 108 MICH. L. REV. 37, 39-40 (2009) (analyzing these issues);
14. Christopher M. Holman, Do Reverse Payment Settlements Violate the Antitrust Laws?, 23 SANTA CLARA COMPUTER & HIGH TECH. L. J. 489, 493 (2007) (analyzing the antitrust implications of reverse payment settlements);
15. Herbert Hovenkamp et al., Anticompetitive Settlement of Intellectual Property Disputes, 87 MINN. L. REV. 1719, 1720 (2003) (suggesting a "way to reconcile the interests of IP law and antitrust law in evaluating IP settlements").
16. Given that the Supreme Court decided its first case involving a reverse payment just last year, see FTC v. Actavis, Inc., 133 S. Ct. 2223, 2227(2013), scholars will continue to explore this subject for the foreseeable future.
17. See, e.g., Herbert Hovenkamp, Anticompetitive Patent Settlements and the Supreme Court's Actavis Decision, 15 MINN. J. L. SCI. & TECH. 3, 3 (2014) (discussing the breadth of the Actavis opinion);
18. Michael A. Carrier, The U. S. Supreme Court Issues First Ruling on Antitrust Liability of Reverse-Payment Drug Patent Settlements (Actavis), E-COMPETITIONS BULL., July 17, 2013, at 1, available at http://perma.cc/PH6B- CP28 (analyzing the Actavis opinion).
19. U. S. CONST. art. I, § 8, cl. 8.
20. See Blonder-Tongue Labs., Inc v. Univ. of Ill. Found., 402 U. S. 313, 350 (1971) (holding that, once a patent is invalidated, nonmutual collateral estoppel prevents the patent owner from ever asserting it again).
21. See, e.g., Michael A. Carrier, Post-Grant Opposition: A Proposal and a Comparison to the America Invents Act, 45 U. C. DAVIS L. REV. 103, 105 (2011) ("Inventions covered by valid patents could foster innovation. In contrast, invalid patents threaten to increase prices and limit competition without any countervailing benefits.").
22. See, e.g., John H. Langbein, The Disappearance of Civil Trial in the United States, 122 YALE L. J. 522, 560 (2012) (discussing the role of "caseload pressures" in judicial promotion of settlement).
23. Owen M. Fiss, Against Settlement, 93 YALE L. J. 1073, 1073 (1984).
24. See U. S. CONST. art. I, § 8, cl. 8 (noting that patents are to "promote the Progress of Science and useful Arts").
25. See, e.g., Herbert Hovenkamp, Antitrust and Innovation: Where We Are and Where We Should Be Going, 77 ANTITRUST L. J. 749, 753 (2011) (noting courts' "strong preference that intellectual property disputes be settled").
26. See In re MSTG, Inc., 675 F.3d 1337, 1339, 1345 (Fed. Cir. 2012) (holding that decision whether settlement negotiations are discoverable must take into account the policy of encouraging settlements);
27. Red Wing Shoe Co v. Hockerson-Halberstadt, Inc., 148 F.3d 1355, 1360-61 (Fed. Cir. 1998) (holding that sending cease-and-desist letters to a forum state does not subject patent owner to personal jurisdiction because a contrary rule would deter settlement of patent disputes).
28. See, e.g., eBay, Inc v. MercExchange, LLC, 547 U. S. 388, 391 (2006) (including public interest as a factor to consider in deciding whether to grant permanent injunction).
29. John Bronsteen, Against Summary Judgment, 75 GEO. WASH. L. REV. 522, 522-23 (2007).
30. Robert A. Baruch Bush & Joseph P. Folger, Mediation and Social Justice: Risks and Opportunities, 27 OHIO ST. J. ON DISP. RESOL. 1, 6 (2012).
31. Janet Cooper Alexander, Do the Merits Matter? A Study of Settlements in Securities Class Actions, 43 STAN. L. REV. 497, 498 (1991).
32. David P. Leonard, The Use of Character to Prove Conduct: Rationality and Catharsis in the Law of Evidence, 58 U. COLO. L. REV. 1, 4-5 (1986) (discussing "society's dominant paradigm of the modern trial, the paradigm of rational truth-seeking").
33. See Stephen C. Yeazell, The Misunderstood Consequences of Modern Civil Process, 1994 WIS. L. REV. 631, 633 n. 3 (discussing a 19% rate during 1936).
34. See 28 U. S. C. § 1338 (a) (2012).
35. Arthur R. Miller, McIntyre in Context: A Very Personal Perspective, 63 S. C. L. REV. 465, 469 (2012) (discussing the "procedural changes effected by the Supreme Court that have resulted in the earlier and earlier disposition of litigation and impaired a citizen's opportunity for a meaningful adjudication of his or her grievances");
36. see Celotex Corp v. Catrett, 477 U. S. 317, 322-23 (1986) (holding that summary judgment is warranted if the moving party can show that the opposing party lacks sufficient evidence to establish an essential element of its case);
37. Anderson v. Liberty Lobby, Inc., 477 U. S. 242, 254-56 (1986) (articulating a "reasonable jury" standard for granting summary judgment);
38. Matsushita Elec. Indus. Co v. Zenith Radio Corp., 475 U. S. 574, 585-88 (1986) (holding that a party whose claim is rendered implausible by factual circumstances must make a greater evidentiary showing to survive summary judgment).
39. see also Stephen B. Burbank, Vanishing Trials and Summary Judgment in Federal Civil Cases: Drifting Toward Bethlehem or Gomorrah?, 1 J. EMPIRICAL LEGAL STUD. 591, 616 (2004) (finding that in each fiscal year from 2000 to 2003, a majority of the motions for summary judgment granted by judges in the Eastern District of Pennsylvania favored defendants).
40. See Ashcroft v. Iqbal, 556 U. S. 662, 678-79 (2009) (affirming the Twombly standard for satisfying Federal Rule of Civil Procedure 8 (a) (2));
41. Bell Atlantic Corp v. Twombly, 550 U. S. 544, 570 (2007) (holding that a plaintiff must plead "enough facts to state a claim to relief that is plausible on its face" to satisfy Federal Rule of Civil Procedure 8 (a) (2)).
42. See, e.g., Thomas A. Lambert, The Roberts Court and the Limits of Antitrust, 52 B. C. L. REV. 871, 917 (2011) (discussing the cost savings produced by the Twombly standard).
43. Raymond H. Brescia, The Iqbal Effect: The Impact of New Pleading Standards in Employment and Housing Discrimination Litigation, 100 KY. L. J. 235, 241 (2011);
44. Patricia W. Hatamyar, The Tao of Pleading: Do Twombly and Iqbal Matter Empirically?, 59 AM. U. L. REV. 553, 582, 615 (2010).
45. see also J. Maria Glover, The Federal Rules of Civil Settlement, 87 N. Y. U. L. REV. 1713, 1718-25 (2012) (discussing various factors that have contributed to the decline of civil trials).
46. E.g., Carrie Menkel-Meadow, For and Against Settlement: Uses and Abuses of the Mandatory Settlement Conference, 33 UCLA L. REV. 485, 487 (1985);
47. see also Andrew W. McThenia & Thomas L. Shaffer, For Reconciliation, 94 YALE L. J. 1660, 1664 (1985) ("Settlement is a process of reconciliation in which the anger of broken relationships is to be confronted rather than avoided, and in which healing demands not a truce but confrontation. ").
48. See George L. Priest & Benjamin Klein, The Selection of Disputes for Litigation, 13 J. LEGAL STUD. 1, 4 (1984) (describing the economic determinants of settlement).
49. see also Owen M. Fiss, The History of an Idea, 78 FORDHAM L. REV. 1273, 1277 (2009) ("Justice is a public good, objectively conceived, and is not reducible to the maximization of the satisfaction of the preferences of the contestants, which, in any event, are a function of the deplorable character of the options available to them.");
50. David Luban, Settlements and the Erosion of the Public Realm, 83 GEO. L. J. 2619, 2639 (1995) ("To the extent that out-ofcourt settlements are based on bargaining power and negotiation skills, facts lose their importance to the outcome, and the outcome will resemble legal justice only coincidentally.") ;
51. Rex R. Perschbacher & Debra Lyn Bassett, The End of Law, 84 B. U. L. REV. 1, 14 (2004) ("The view of 'law' as little more than a process for resolving disputes removes its normative content and force, and diminishes law's significance in ordering society.").
52. Jules Coleman & Charles Silver, Justice in Settlements, 4 SOC. PHIL. & POL'Y 102, 114-19 (1986);
53. Jill E. Fisch, Rewriting History: The Propriety of Eradicating Prior Decisional Law Through Settlement and Vacatur, 76 CORNELL L. REV. 589, 589 (1991);
54. Judith Resnik, Courts: In and Out of Sight, Site, and Cite, 53 VILL. L. REV. 771, 804 (2008);
55. W. Mark C. Weidemaier, Judging-Lite: How Arbitrators Use and Create Precedent, 90 N. C. L. REV. 1091, 1123 (2012).
56. See, e.g., Laurie Kratky Dore, Secrecy by Consent: The Use and Limits of Confidentiality in the Pursuit of Settlement, 74 NOTRE DAME L. REV. 283, 285 (1999)
57. [hereinafter Dore, Secrecy by Consent] (noting that settlements are often conditioned upon confidentiality agreements that prohibit disclosure of the terms and amount of the settlement);
58. Erik S. Knutsen, Keeping Settlements Secret, 37 FLA. ST. U. L. REV. 945, 946 (2010) ("The vast majority of cases that settle require as a condition of settlement that the litigating parties keep some aspect of the settlement a secret."); Luban, supra note 62, at 2648-49 (arguing that "the widespread practice of secret settlements carves out an unacceptable area of exceptions to democratic publicity");
59. see also Laurie Kratky Dore, Public Courts Versus Private Justice: It's Time to Let Some Sun Shine in on Alternative Dispute Resolution, 81 CHI.-KENT L. REV. 463, 463 (2006) ("Since the early to mid-1990s, the issue of secrecy in litigation has attracted nationwide attention and has generated a literal mountain of commentary.").
60. See FED. R. CIV. P. 23 (e).
61. See Bill Lockyer, Sunshine in the Courts: The Need to Limit Secrecy Agreements that Hide Information on Hazards, 20 Prod. Safety & Liab. Rep. (BNA) No. 47, pt. II, at 40, 43 (Nov. 27, 1993) (discussing secret settlements involving breast implants, heart valves, and asbestos).
62. Carrie Menkel-Meadow, Ethics and the Settlements of Mass Torts: When the Rules Meet the Road, 80 CORNELL L. REV. 1159, 1211 n. 221 (1995);
63. Dev. K. Sethi, Mediation & Settlement Conferences: A Practical View from the Plaintiff's Perspective, ARIZ. ATT'Y, Oct. 2007, at 36, 39 ("You know it's a good settlement when everyone walks away unhappy.").
64. Howard S. Erlanger et al., Participation & Flexibility in Informal Process: Cautions from the Divorce Context, 21 LAW & SOC'Y REV. 585, 592 (1987).
65. Dore, Secrecy by Consent, supra note 73, at 294 ("Even the staunchest defenders of adjudication⋯ grudgingly acknowledge that settlement will remain a permanent fixture of the litigation landscape."); Glover, supra note 54, at 1725 ("Settlement is here to stay.").
66. Abram Chayes, The Role of the Judge in Public Law Litigation, 89 HARV. L. REV. 1281, 1283 (1976).
67. Judith Resnik, Managerial Judges, 96 HARV. L. REV. 374, 376 (1982).
68. Marc Galanter, The Emergence of the Judge as a Mediator in Civil Cases, 69 JUDICATURE 257, 257 (1986);
69. Kimba Wood & Charles Brieant, On Judging Today in District Courts, FED. LAW., May 2007, at 20, 22 ("The modern judge is quickly becoming a slave to statistics.").
70. Michael Moffitt, Three Things to Be Against ("Settlement" Not Included), 78 FORDHAM L. REV. 1203, 1210 (2009) ("The most conspicuous of settlement's contributions to modern litigation is its capacity to reduce the number of cases demanding judicial resources and attention. ").
71. Peter Robinson, An Empirical Study of Settlement Conference Nuts and Bolts: Settlement Judges Facilitating Communication, Compromise and Fear, 17 HARV. NEGOT. L. REV. 97, 98 (2012).
72. J. Skelly Wright, The Pretrial Conference, 28 F. R. D. 37, 145 (1962).
73. Peter H. Schuck, The Role of Judges in Settling Complex Cases: The Agent Orange Example, 53 U. CHI. L. REV. 337, 337 (1986);
74. Jack B. Weinstein, Comments on Owen M. Fiss, Against Settlement (1984), 78 FORDHAM L. REV. 1265, 1268 (2009) (arguing that settlement in the Agent Orange case was essential).
75. See FED. R. CIV. P. 16 (a) (stating that one purpose of the pretrial conference is to facilitate settlement).
76. Brian J. Shoot & Christopher T. McGrath, "Don't Come Back Without a Reasonable Offer"-Surprisingly Little Direct Authority Guides How Judges Can Move Parties, N. Y. ST. B. A. J., May 2004, at 28, 33
77. See, e.g., James E. Gritzner, In Defense of the Jury Trial: ADR Has Its Place, But It Is Not the Only Place, 60 DRAKE L. REV. 349, 349-54 (2012) (arguing that we should curb the increasing trend towards ADR);
78. Robert F. Peckham, The Federal Judge as a Case Manager: The New Role in Guiding a Case from Filing to Disposition, 69 CALIF. L. REV. 770, 773 (1981) ("While few judges wish to force unwilling parties to settle, many judges believe that the promotion of informed and fair settlements is one of the most important aims of pretrial management.");
79. David Shapiro, Federal Rule 16: A Look at the Theory and Practice of Rulemaking, 137 U. PA. L. REV. 1969, 1995 (1989) ("Judges are human and humans tend to abuse power when they have it; Rule 16 is surely no exception. ");
80. See Lucy V. Katz, Compulsory Alternative Dispute Resolution and Voluntarism: Two-Headed Monster or Two Sides of the Coin?, 1993 J. DISP. RESOL. 1, 16 (stating that judicial pressure to settle can be "intense");
81. Blake D. Morant, The Declining Prevalence of Trials as a Dispute Resolution Device: Implications for the Academy, 38 WM. MITCHELL L. REV. 1123, 1127 (2012) (noting that some courts sanction parties who fail to accept a settlement or reach a settlement by a court-imposed deadline);
82. See, e.g., Ward v. Village of Monroeville, 409 U. S. 57, 59 (1972) (holding that a city mayor cannot serve as an impartial judge because of the possible conflict with his executive interests);
83. Goldberg v. Kelly, 397 U. S. 254, 271 (1970) (holding that an impartial decisionmaker is "essential").
84. U. S. CONST. art. I, § 8, cl. 8.
85. See 35 U. S. C. § 154 (2012) (outlining a patent term of twenty years).
86. See Lisa A. Dolak, Power or Prudence: Toward a Better Standard for Evaluating Patent Litigants'Access to the Declaratory Judgment Remedy, 41 U. S. F. L. REV. 407, 410 (2007) ("[M]ost commonly, infringement defendants request judgment on the ground that the patent at issue is invalid, unenforceable, and/or not infringed.").
87. See 35 U. S. C. § 282.
88. See, e.g., Chester S. Chuang, Offensive Venue: The Curious Use of Declaratory Judgment to Forum Shop in Patent Litigation, 80 GEO. WASH. L. REV. 1065, 1065 (2012) (noting that alleged infringers often file declaratory judgment actions to forum shop).
89. See Tom Ewing & Robin Feldman, The Giants Among Us, 2012 STAN. TECH. L. REV. 1, 119 (discussing the need to calculate risk of damages and injunctions in deciding whether to litigate).
90. See Blonder-Tongue Labs., Inc v. Univ. of Ill. Found., 402 U. S. 313, 350 (1971) (holding that, once a patent is invalidated, nonmutual collateral estoppel prevents the patent owner from ever asserting it again).
91. Marketa Trimble, When Foreigners Infringe Patents: An Empirical Look at the Involvement of Foreign Defendants in Patent Litigation in the U. S., 27 SANTA CLARA COMPUTER & HIGH TECH. L. J. 499, 519 (2011) ("[M]ost patent cases end in settlement⋯.").
92. JAMES BESSEN & MICHAEL J. MEURER, PATENT FAILURE 127 (2008).
93. ELEC. INFO. PRODS. DIV. & PATENT TECH. MONITORING TEAM, U. S. PATENT & TRADEMARK OFFICE, U. S. PATENT STATISTICS
94. [hereinafter U. S. PATENT STATISTICS], available at http://perma.cc/5WQL- RXSP;
95. see also Michael D. Frakes & Melissa F. Wasserman, Does Agency Funding Affect Decisionmaking?: An Empirical Assessment of the PTO's Granting Patterns, 66 VAND. L. REV. 67, 70 (2013) (arguing that the PTO's fee structure biases the agency toward granting patents).
96. Andrew Beckerman-Rodau et al., The New Private Ordering of Intellectual Property: The Emergence of Contracts as the Drivers of Intellectual Property Rights, 4 J. BUS. & TECH. L. 5, 31 n. 69 (2009).
97. U. S. PATENT STATISTICS, supra note 115 (illustrating the dramatic increase in the number of patents issued by the PTO).
98. Michael Risch, Patent Troll Myths, 42 SETON HALL L. REV. 457, 459 (2012).
99. Xuan-Thao Nguyen, The China We Hardly Know: Revealing the New China's Intellectual Property Regime, 55 ST. LOUIS U. L. J. 773, 776 n. 20 (2011).
100. Martin H. Redish, Summary Judgment and the Vanishing Trial: Implications of the Litigation Matrix, 57 STAN. L. REV. 1329, 1330 (2005)
101. See, e.g., John R. Allison & Mark A. Lemley, Empirical Evidence on the Validity of Litigated Patents, 26 AIPLA Q. J. 185, 208-10 (1998) (explaining that the nonobviousness requirement is responsible for invalidating more patents than any other patent rule);
102. Glynn S. Lunney, Jr., Patent Law, the Federal Circuit, and the Supreme Court: A Quiet Revolution, 11 SUP. CT. ECON. REV. 1 (2003) (finding that, since the creation of the Federal Circuit, patent owners are more likely to lose on infringement than validity grounds);
103. David L. Schwartz, Practice Makes Perfect? An Empirical Study of Claim Construction Reversal Rates in Patent Cases, 107 MICH. L. REV. 223, 223 (2008) (examining whether U. S. district court judges improve their skills at patent claim construction with experience, such as having their cases reviewed on appeal).
104. See, e.g., John R. Allison et al., Valuable Patents, 92 GEO. L. J. 435, 438 (2004)
105. [hereinafter Allison et al., Valuable Patents] (describing the characteristics of litigated patents);
106. John R. Allison et al., Extreme Value or Trolls on Top? The Characteristics of the Most-Litigated Patents, 158 U. PA. L. REV. 1, 3 (2009) ("[T|he most-litigated patents are far more likely to be software and telecommunications patents, not mechanical or other types of patents.");
107. Colleen V. Chien, Predicting Patent Litigation, 90 TEX. L. REV. 283, 287-88 (2011) (examining both intrinsic and acquired characteristics of patents).
108. See, e.g., James Bessen & Michael J. Meurer, The Direct Costs from NPE Disputes, 99 CORNELL L. REV. (forthcoming 2014) (manuscript at 3, 8, 11), available at http://perma.cc/S557-SQTE (asserting that an "explosion" in patent litigation initiated by "Non-Practicing Entities (NPEs) " imposes substantial direct costs on inventors);
109. James E. Bessen & Michael J. Meurer, The Private Costs of Patent Litigation 2 (Bos. Univ. Sch. of Law, Law & Econ. Working Paper No. 07-08, 2008), available at http://perma.cc/JC5M-NPDE (finding the expected joint loss to the litigating parties is large, despite the fact that most patent lawsuits settle short of trial).
110. See, e.g., U. S. COURT OF APPEALS FOR THE FED. CIRCUIT, CIRCUIT MEDIATION OFFICE STATISTICS, available at http://perma.cc/H5B6-CHAB (indicating that forty-four patent appeals were settled through the Federal Circuit's mediation program in 2011).
111. Allison et al., Valuable Patents, supra note 126, at 437;
112. see also Matthew C. Turk, Why Does the Complainant Always Win at the WTO?: A Reputation-Based Theory of Litigation at the World Trade Organization, 31 NW. J. INT'L L. & BUS. 385, 398 (2011) (stating that parties who believe they will prevail at trial are less likely to settle).
113. U. S. CONST. art. 1, § 8, cl. 8.
114. See also Robert P. Merges et al., INTELLECTUAL PROPERTY IN THE NEW TECHNOLOGICAL AGE 29 (6th ed. 2012) ("The public benefits directly through the spur to innovation and disclosure of new technology.");
115. Megan M. La Belle, Patent Law as Public Law, 20 GEO. MASON L. REV. 41, 50 (2012) (demonstrating that the purpose of the patent system is to benefit the public).
116. United States v. Masonite Corp., 316 U. S. 265, 278 (1942) ("[T]he promotion of the progress of science and the useful arts is the 'main object'; reward of inventors is secondary and merely a means to that end.")
117. Hilton Davis Chem. Co v. Warner Jenkinson Co., 62 F.3d 1512, 1536 (Fed. Cir. 1995) (Newman, J., concurring) ("The patent law is directed to the public purposes of fostering technological progress, investment in research and development, capital formation, entrepreneurship, innovation, national strength, and international competitiveness.")
118. rev'd, 520 U. S. 17 (1997).
119. 347 U. S. 483, 495 (1954).
120. See, e.g., O'Reilly v. Morse, 56 U. S. 62, 121 (1854) (holding a patent invalid and therefore "unjust to the public").
121. See, e.g., Blonder-Tongue Labs., Inc v. Univ. of Ill. Found., 402 U. S. 313, 350 (1971) (holding that, once a patent is invalidated, nonmutual collateral estoppel prevents the patent owner from ever asserting it again); La Belle, supra note 153, at 65 (discussing the "public good problem", which "dissuades parties from contesting patents because they bear all the costs and risks of litigation, but reap only part of the benefit");
122. Joseph S. Miller, Building a Better Bounty: Litigation-Stage Rewards for Defeating Patents, 19 BERKELEY TECH. L. J. 667, 704-05 (2004) (explaining that litigation-stage bounties adequately reward the defeat of commercially significant patents).
123. See Lear, Inc v. Adkins, 395 U. S. 653, 673-74 (1969).
124. See, e.g., In re Tamoxifen Citrate Antitrust Litig., 466 F.3d 187, 211 (2d Cir. 2006) ("It would be odd to handicap the ability of [the defendant] to settle after it had displayed sufficient confidence in its patent to risk a finding of invalidity by taking the case to trial.")
125. abrogated by FTC v. Actavis, Inc., 133 S. Ct. 2223, 2230 (2013);
126. See, e.g., Flex-Foot, Inc v. CRP, Inc., 238 F.3d 1362, 1367-70 (Fed. Cir. 2001) (holding that a settlement agreement with an express provision precluding future validity challenges did not violate Lear);
127. Foster v. Hallco Mfg. Co., 947 F.2d 469, 476-77 (Fed. Cir. 1991) (holding that it was permissible for the provision in the consent decree to preclude further validity challenges); see also infra Part V. C (discussing the Federal Circuit's prosettlement jurisprudence).
128. See, e.g., Tamoxifen, 466 F.3d at 211 (explaining that settlements involving weak patents may protect monopolies that are unjustified).
129. While the Tamoxifen court's statement was made in the context of reverse payment settlements and thus may no longer hold water after FTC v. Actavis, 133 S. Ct. 2223, 2230(2013), it is certainly still true with respect to standard patent settlements, which the Supreme Court did not address in Actavis.
130. Joseph Farell & Robert P. Merges, Incentives to Challenge and Defend Patents: Why Litigation Won't Reliably Fix Patent Office Errors and Why Administrative Patent Review Might Help, 19 BERKELEY TECH. L. J. 943, 952, 958 (2004) (same);
131. See Blonder-Tongue Labs., Inc v. Univ. of Ill. Found., 402 U. S. 313, 343, 346-50 (1971).
132. Rochelle C. Dreyfuss & Lawrence S. Pope, Dethroning Lear? Incentives to Innovate After MedImmune, 24 BERKELEY TECH. L. J. 971, 1001 n. 121 (2009);
133. see also Michael Risch, Patent Challenges and Royalty Inflation, 85 IND. L. J. 1003, 1022 (2010) (explaining the imbalance when "the challenger faces all of the cost and risk but only reaps some of the benefits");
134. John R. Thomas, Liberty and Property in the Patent Law, 39 HOUS. L. REV. 569, 618 n. 361 & 619 (2002) (discussing the "free-rider" problem).
135. See, e.g., F. Scott Kieff, Quanta and the Future of Supreme Court Patent Jurisprudence, 9 ENGAGE: J. FEDERALIST SOC'Y PRAC. 73, 74 (2008) ("[In] settlement negotiations around ongoing or potential patent litigation, or mediation of a patent dispute,⋯ what the potential infringer often wants is mere peace from future litigation risk⋯.");
136. Lea Shaver, Illuminating Innovation: From Patent Racing to Patent War, 69 WASH. & LEE L. REV. 1891, 1892 (2012);
137. see also FRED WARSHOFSKY, THE PATENT WARS 29 (1994).
138. Precision Instrument Mfg. Co v. Auto. Maint. Mach. Co., 324 U. S. 806, 816 (1945) ("[A patent] is a special privilege designed to serve the public purpose of promoting the 'Progress of Science and useful Arts.'").
139. Blonder-Tongue Labs., Inc v. Univ. of Ill. Found., 402 U. S. 313, 343 (1971)
140. (quoting Precision Instrument Mfg. Co., 324 U. S. at 816).
141. See, e.g., In re Tamoxifen Citrate Antitrust Litig., 466 F.3d 187, 211 (2d Cir. 2005) (suggesting that rules allowing settlements at or above expected market value for the infringer will allow weak patents to persist).
142. Jeremy W. Bock, Neutral Litigants in Patent Cases, 15 N. C. J. L. & TECH. 233, 250-51 (2014).
143. Colleen V. Chien, From Arms Race to Marketplace: The Complex Patent Ecosystem and Its Implications for the Patent System, 62 HASTINGS L. J. 297, 297 (2010) (coining the term "patent assertion entity");
144. see also Robert A. Armitage, The Conundrum Confronting Congress: The Patent System Must Be Left Untouched While Being Radically Reformed, 5 J. MARSHALL REV. INTELL. PROP. L. 268, 276 (2006) ("Being forced to settle because there is little prospect for a fair fight against a patent of questionable validity is the antithesis of a fair and balanced patent system.");
145. Gerard N. Magliocca, Blackberries and Barnyards: Patent Trolls and the Perils of Innovation, 82 NOTRE DAME L. REV. 1809, 1831 (2007) ("[A] troll only needs a single and cheap patent to force a large settlement.").
146. See, e.g., Colleen V. Chien & Mark A. Lemley, Patent Holdup, the ITC, and the Public Interest, 98 CORNELL L. REV. 1, 2 (2012) (describing PAEs).
147. see also eBay Inc v. MercExchange, LLC, 547 U. S. 388, 397 (2006) (Kennedy, J., concurring) ("[A]n injunction⋯ can be employed as a bargaining tool to charge exorbitant fees.");
148. Garrett Barten, Note, Permanent Injunctions: A Discretionary Remedy for Patent Infringement in the Aftermath of the eBay Decision, 16 U. MIAMI BUS. L. REV. 1, 12 (2007) (noting that the threat of an injunction forced RIM to settle for $612.5 million, nearly eighteen times the amount the jury awarded in damages).
149. Mark A. Lemley & Carl Shapiro, Patent Holdup and Royalty Stacking, 85 TEX. L. REV. 1991, 1992-93 (2007);
150. Brian J. Love, The Misuse of Reasonable Royalty Damages as a Patent Infringement Deterrent, 74 MO. L. REV. 909, 931 (2009) (defining patent holdup as "the opportunistic use of patent rights to extract above-benchmark compensation").
151. Sarah R. Wasserman Rajec, Tailoring Remedies to Spur Innovation, 61 AM. U. L. REV. 733, 742 (2012) ("The furor over NPEs and their skewed incentives grew in the years leading up to the eBay decision. ").
152. 547 U. S. at 393-94.
153. see also Ronald J. Schutz & Patrick M. Arenz, Non-Practicing Entities and Permanent Injunctions Post-eBay, 12 SEDONA CONF. J. 203, 205 (2011) (acknowledging the view that NPEs are not likely to be awarded permanent injunctions post-eBay).
154. Xuan-Thao Nguyen, Justice Scalia's "Renegade Jurisdiction": Lessons for Patent Law Reform, 83 TUL. L. REV. 111, 118 (2008).
155. Arti K. Rai et al., University Software Ownership and Litigation: A First Examination, 87 N. C. L. REV. 101, 139-40 (2009).
156. Robert A. Armitage, Now That the Courts Have Beaten Congress to the Punch, Why Is Congress Still Punching the Patent System?, 106 MICH. L. REV. FIRST IMPRESSIONS 43, 46 (2007) (explaining that some believe the "threat of runaway damages⋯ has forced extravagant settlements of patent lawsuits");
157. PRICEWATERHOUSECOOPERS, 2013 PATENT LITIGATION STUDY: LITIGATION CONTINUES TO RISE AMID GROWING AWARENESS OF PATENT VALUE 8(2013), available at http://perma.cc/Z66N-L9YQ (listing the ten largest initial damages awards in patent cases between 1995 and 2011).
158. See Julianne Pepitone, Jury Awards Samsung Another $290 Million, http://perma.cc/QG76-5RJY (cnn.com, archived Feb. 1, 2014).
159. Mark A. Lemley, Essay, Rational Ignorance at the Patent Office, 95 NW. U. L. REV. 1495, 1502 (2001).
160. LAW PRACTICE MGMT. COMM., AM. INTELL. PROP. L. ASS'N, REPORT OF THE ECONOMIC SURVEY 2011, at 35 (2011).
161. See, e.g., Libbey-Owens-Ford Glass Co v. Sylvania Indus. Corp., 154 F.2d 814, 824 (2d Cir. 1946) ("[I]t is well known that the notoriously great cost of [a patent] defense has often induced infringers to accept licenses on onerous terms rather than to engage in litigation, with the result that 'spurious' patents, uncontested, substantially reduce competition. ").
162. Matt Levy, Patent Progress's Guide to Patent Reform Legislation, http://perma.cc/P5TG-C9R3 (patentprogress.org, archived Feb. 1, 2014).
163. See, e.g., Innovation Act, H. R. 3309, 113th Cong. (2013);
164. Patent Transparency and Improvements Act, S. 1720, 113th Cong. (2013);
165. Patent Abuse Reduction Act, S. 1013, 113th Cong. (2013);
166. Patent Litigation Integrity Act, S. 1612, 113th Cong. (2013).
167. See, e.g., Letter from 50 Organizations to Congressional Leadership Urging Solutions to Patent Abuse (July 17, 2013), available at http://perma.cc/VW93-33VJ.
168. Improving the Patent System to Promote American Innovation and Competitiveness: Hearing on H. R. 3309 Before H. Comm. on the Judiciary, 113th Cong. (2013) (statement of Kevin T. Kramer, Vice President & Deputy Gen. Counsel of Intellectual Prop. for Yahoo! Inc.);
169. see also Protecting Small Businesses and Promoting Innovation by Limiting Patent Troll Abuse: Hearing Before S. Comm. of the Judiciary, 113th Cong. (2013) (statement of Dana Rao, Vice President & Assoc. Gen. Counsel of Intellectual Prop. & Litig. for Adobe Sys., Inc.) ("Bad actors are taking advantage of asymmetrical costs of patent litigation to pressure defendants into settlement.")
170. See, e.g., Improving the Patent System, supra note 206 (statement of Krish Gupta, Senior Vice President & Deputy Gen. Counsel for EMC Corp.).
171. Press Release, House Passes Innovation Act to Make Reforms to Our Patent System, U. S. House of Rep. Comm. on the Judiciary (Dec. 5, 2013), available at http://judiciary.house.gov/news/2013/12052013.html.
172. The bills currently under consideration in the Senate include the Patent Transparency and Improvements Act, S. 1720, 113th Cong. (2013);
173. the Patent Abuse Reduction Act, S. 1013, 113th Cong. (2013);
174. and the Patent Litigation Integrity Act, S. 1612, 113th Cong. (2013).
175. These bills cover most of the same issues as the Innovation Act, H. R. 3309, 113th Cong. (2013), although one difference is that S. 1720 provides that certain demand-letter practices may constitute an unfair and deceptive trade practice.
176. Scott A. McKeown, Senate to Schedule Additional Hearings on Leahy Patent Reform Bill, http://perma.cc/7LA-MGQU (patentspostgrant.com, archived Feb. 1, 2014);
177. Tony Dutra, Senate Patent Litigation Reform Hearing Calls for More Deliberate Approach than House, http://perma.cc/HW43-SUF7 (bna.com, archived Feb. 1, 2014).
178. See, e.g., Patent Quality Improvement: Hearing Before the Subcomm. on Courts, the Internet, and Intell. Prop. of the H. Comm. on the Judiciary, 108th Cong. 54 (2003) (statement of David M. Simon, Chief Patent Counsel, Intel Corp.), available at http://perma.cc/X8PN-2RYN ("This unpredictable legal environment has encouraged legitimate companies threatened by patent trolls to pay large settlements⋯.");
179. Mark A. Lemley, Contracting Around Liability Rules, 100 CALIF. L. REV. 463, 474-75 (2012) ("Perhaps the uncertainty of outcome is enough to cause risk-averse parties to settle rather than chance a bad outcome.").
180. See, e.g., Cybor Corp v. FAS Techs., Inc., 138 F.3d 1448, 1475 n. 3 (Fed. Cir. 1998) (Rader, J., dissenting in part) (describing how parties calculate, and often overestimate, their chances of prevailing on the merits, which reduces the likelihood of settlement).
181. See, e.g., R. Polk Wagner, The Supreme Court and the Future of Patent Reform, FED. LAW., Feb. 2008, at 35, 39 ("[E]ven though patent law is a creature of statute, much of the actual legal landscape has been constructed by decades of court decisions, in common-law-like fashion. ").
182. Leahy-Smith America Invents Act, Pub. L. No. 112-29, 125 Stat. 284 (2011);
183. see also Gregory N. Mandel, Proxy Signals: Capturing Private Information for Public Benefit, 90 WASH. U. L. REV. 1, 45 (2012) (arguing that the AIA is a watered-down version of prior reform efforts).
184. See, e.g., John F. Duffy, The Federal Circuit in the Shadow of the Solicitor General, 78 GEO. WASH. L. REV. 518, 544 (2010) (stating that patent law "has traditionally had a common law feel to it");
185. Craig Allen Nard, Legal Forms and the Common Law of Patents, 90 B. U. L. REV. 51, 53 (2010) (noting that common law is "the dominant legal force in the development of U. S. patent law").
186. Jeremy W. Bock, An Empirical Study of Certain Settlement-Related Motions for Vacatur in Patent Cases, 88 IND. L. J. 919, 921-22 (2013);
187. See, e.g., Omega Eng'g, Inc v. Raytek Corp., 334 F.3d 1314, 1334 (Fed. Cir. 2003) (holding that generally "the same claim term in the same patent or related patents carries the same construed meaning");
188. Mycogen Plant Sci., Inc v. Monsanto Co., 252 F.3d 1306, 1310-11 (Fed. Cir. 2001) (holding that collateral estoppel precludes relitigation of claim construction in actions involving different but related patents)
189. vacated on other grounds, 535 U. S. 1109 (2002).
190. Mark R. Patterson, Leveraging Information About Patents: Settlements, Portfolios, and Holdups, 50 HOUS. L. REV. 483, 498 (2012).
191. See Medicare Prescription Drug, Improvement, and Modernization Act of 2003, Pub. L. No. 108-173, § 1112, 117 Stat. 2066, 2461-63 (2003)
192. (codified at 21 U. S. C. § 355 (2012)) (requiring the filing of certain pharmaceutical patent-settlement agreements with the Federal Trade Commission ("FTC") and the Department of Justice ("DOJ"));
193. FTC v. Actavis, Inc., 133 S. Ct. 2223, 2237 (2013) (holding that reverse payment patent settlement must be analyzed for antitrust compliance pursuant to the rule of reason).
194. See, e.g., David L. Schwartz, The Rise of Contingent Fee Representation in Patent Litigation, 64 ALA. L. REV. 335, 370-71 (2012) (discussing patent cases with settlement demands as low as $5, 000 to $10, 000).
195. See Scott A. Moss, Illuminating Secrecy: A New Economic Analysis of Confidential Settlements, 105 MICH. L. REV. 867, 870 (2007) (explaining that confidential settlements have been criticized for allowing defendants to conceal "serious misdeeds").
196. 35 U. S. C. § 284 (2012);
197. Minco, Inc v. Combustion Eng'g, Inc., 95 F.3d 1109, 1119 (Fed. Cir. 1996).
198. Uniloc USA, Inc v. Microsoft Corp., 632 F.3d 1292, 1312 (Fed. Cir. 2011).
199. ResQNet.com, Inc v. Lansa, Inc., 594 F.3d 860, 872 (Fed. Cir. 2010) (explaining that the trial court "must consider licenses that are commensurate with what the defendant has appropriated").
200. E.g., Einer Elhauge & Alex Krueger, Solving the Patent Settlement Puzzle, 91 TEX. L. REV. 283, 284-85 (2012).
201. Last year, the Supreme Court addressed the question of how reverse payment settlement agreements should be scrutinized from an antitrust perspective in FTC v. Actavis, Inc., 133 S. Ct. 2223 (2013).
202. (quoting FTC v. Watson Pharms., Inc., 677 F.3d 1298, 1311 (11th Cir. 2012)).
203. See Medicare Prescription Drug, Improvement, and Modernization Act of 2003, Pub. L. No. 108-173, § 1112, 117 Stat. 2066, 2461-63 (2003)
204. (codified at 21 U. S. C. § 355 (2012)) (requiring disclosure of agreements regarding "the manufacture, marketing, or sale" of the brand name and generic drugs in question). Under the new postgrant review procedures created by the AIA, parties who settle must file their settlement agreements with the PTO.
205. See 35 U. S. C. §§ 317, 327 (2012) (requiring filing for inter partes review and postgrant review). At the parties' request, the PTO will keep these agreements confidential unless requested by another federal agency or a person who demonstrates good cause. Id. This raises the question whether the FTC or some other federal agency might start reviewing patent settlements outside the reverse payment context.
206. See Robert G. Sterne et al., America Invents Act: The 5 New Post-Issuance Procedures, 13 SEDONA CONF. J. 27, 43-44 (2012) (questioning whether the FTC should review settlement agreements in high-stakes postgrant and inter partes review proceedings).
207. See Actavis, 133 S. Ct. at 2232 ("[T]his Court's precedents make clear that patentrelated settlement agreements can sometimes violate the antitrust laws.").
208. See, e.g., Virginia Panel Corp v. MAC Panel Co., 133 F.3d 860, 869 (Fed. Cir. 1997) (describing tying and postexpiration royalties); Hovenkamp et al., supra note 15, at 1721 (discussing forms of out-of-court settlements and corresponding antitrust concerns).
209. See Actavis, 133 S. Ct. at 2243 (Roberts, J., dissenting) (stating that settlements outside the Hatch-Waxman context are private agreements that are not publicly available);
210. Christina Bohannan & Herbert Hovenkamp, IP and Antitrust: Reformation and Harm, 51 B. C. L. REV. 905, 928-44 (2010) (describing anticompetitive problems posed by patent settlement agreements);
211. Marc G. Schildkraut, Patent-Splitting Settlements and the Reverse Payment Fallacy, 71 ANTITRUST L. J. 1033, 1048 (2004) (discussing lack of "red flags" with conventional patent settlements).
212. See, e.g., ADAM B. JAFFE & JOSH LERNER, INNOVATION AND ITS DISCONTENTS: HOW OUR BROKEN PATENT SYSTEM IS ENDANGERING INNOVATION AND PROGRESS, AND WHAT TO DO ABOUT IT (Princeton Univ. Press, 2004) (discussing how changes made to the patent system starting in 1982 encourage frivolous litigation and hinders innovation);
213. Stuart Minor Benjamin & Arti K. Rai, Who's Afraid of the APA? What the Patent System Can Learn from Administrative Law, 95 GEO. L. J. 269, 276-78 (2007) (discussing how the patent examination process fails to serve the patent system's economic goals).
214. FED. TRADE COMM'N, TO PROMOTE INNOVATION: THE PROPER BALANCE OF COMPETITION AND PATENT LAW AND POLICY 5-6(2003), available at http://perma.cc/F5P3-CCQB.
215. David Segal, Has Patent, Will Sue: An Alert to Corporate America, http://perma.cc/D6E3-UDGV (nytimes.com, archived Feb. 1, 2014).
216. See Geoffrey P. Miller, Preliminary Judgments, 2010 U. ILL. L. REV. 165, 166 ("[S]ettlements deny litigants a 'day in court' and thus may feel unsatisfying.").
217. Francis E. McGovern, Rethinking Cooperation Among Judges in Mass Tort Litigation, 44 UCLA L. REV. 1851, 1869 (1997).
218. Nancy Levit, Megacases, Diversity, and the Elusive Goal of Workplace Reform, 49 B. C. L. REV. 367, 383-84 (2008) (" '[M]egacases' have forced an expansion in the role of the judge from simply presiding over traditional litigation to more active participation in mediating global solutions.");
219. Adam Shartzer, Patent Litigation 101: Empirical Support for the Patent Pilot Program's Solution to Increase Judicial Experience in Patent Law, 18 FED. CIR. B. J. 191, 230 (2009) ("A judge that does not like patent cases may more strongly encourage a settlement between the parties to avoid a lengthy and complicated litigation. ").
220. See, e.g., Charles Duhigg & Steve Lohr, The Patent, Used as a Sword, http://perma.cc/WJ5E-KVZN (nytimes.com, archived Feb. 1, 2014) (discussing how companies file numerous lawsuits to prevent competition);
221. Glenn G. Lammi, 'Tis the Season for More Smartphone Patent War' Court Rulings, http://perma.cc/T49P-UATW (forbes.com, archived Feb. 1, 2014) (discussing important recent decisions in "the patent wars.");
222. Smartphone Cases Caught Up in Patent Wars, http://perma.cc/FD3X-GCT3 (chicagotribune.com, archived Feb. 1, 2014) (describing the rise in litigation over smartphone cases).
223. See Jessica E. Vascellaro, Apple and Samsung Trade Jabs in Court, http://perma.cc/4KM3-R6TT (wsj.com, archived Feb. 1, 2014) (describing in detail the opening statements of one such trial and noting the crowd that gathered in the courthouse).
224. See WALTER ISAACSON, STEVE JOBS 1 (2011).
225. Transcript of Proceedings at 16:10-21
226. Apple, Inc v. Samsung Elecs. Co., No. 5:11-cv-01846-LHK, (N. D. Cal. June 21, 2011).
227. Josh Lowensohn, Judge Says Apple's "Smoking Crack" with Giant Witness List, http://perma.cc/YJ8X-EMMM (cnet.com, archived Feb. 1, 2014).
228. Judge Urges Apple and Samsung to Settle Their Patent Dispute, http://perma.cc/7YR3-6BQG (nytimes.com, archived Feb. 1, 2014).
229. Natasha Lomas, Apple vs. Samsung: Judge Koh Makes Plea for "Global Peace" as Pair Muster Latest Rounds of Legal Arguments, http://perma.cc/Z69S-6LSE (techcrunch.com, archived Feb. 1, 2014).
230. Chris O'Brien, Apple, Samsung Agree to Try Mediation in Patent Disputes, http://perma.cc/L5S3-QRQJ (latimes.com, archived Feb. 1, 2014).
231. See Phillip Elmer-DeWitt, Apple-Samsung Mediation Talks: Don't Hold Your Breath, http://perma.cc/NU5H-9LN7 (cnn.com, archived Feb. 1, 2014).
232. Apple, Inc v. Motorola, Inc., No. 1:11-cv-08540 (N. D. Ill. June 22, 2012) (opinion and order for dismissal), available at http://perma.cc/9JPV-4MGS.
233. The Federal Circuit heard oral argument in Apple, Inc v. Motorola, Inc. on September 11, 2013, but it has not yet issued a decision in the case.
234. Apple, Inc v. Motorola, Inc., No. 1:11-cv-08540 (N. D. Ill. June 7, 2012) (tentative order for dismissal), available at http://perma.cc/HGY8-KAB9.
235. Apple, Inc v. Motorola, Inc., No. 1:11-cv-08540 (N. D. Ill. June 22, 2012) (opinion and order for dismissal), available at http://perma.cc/T4BS-4RCF.
236. Ian Sherr, Apple, HTC Settle Patent Dispute, Sign Licensing Pact, http://perma.cc/LS7T-8XRY (wsj.com, archived Feb. 1, 2014).
237. See John R. Allison, Emerson H. Tiller & Samantha Zyontz, Patent Litigation and the Internet, 2012 STAN. TECH. L. REV. 1, 55 ("As with the decision to institute patent litigation in the first place, the decision to settle is a complex one affected by countless factors, most of which are undiscoverable or at least unmeasurable.").
238. See, e.g., Tim Culpan & Adam Satariano, Apple Settles HTC Patent Suits Shifting from Jobs' War, http://perma.cc/DZ28-EMK4 (bloomberg.com, archived Feb. 1, 2014) ("For as long as Tim Cook has been CEO, Apple has been less interested in pursuing legal assaults against competitors, choosing increasingly to find ways to settle differences out of court." (internal quotation marks omitted)).
239. See, e.g., Erik Kain, Samsung Takes a Jab at Apple in the Court of Public Opinion, http://perma.cc/KC4J-9W3W (forbes.com, archived Feb. 1, 2014) (suggesting that Samsung's commercial mocking Apple's iPhone 5 tapped into public frustration with patent suits).
240. Roger Cheng, Judge Tells Apple and HTC to Start Talking Settlement, http://perma.cc/7JXA-CEJC (cnet.com, archived Feb. 1, 2014);
241. See also Settlement Reached in BlackBerry Patent Case, http://perma.cc/YA52-8MYC (nbcnews.com, archived Feb. 1, 2014) (explaining that the trial judge "expressed impatience with RIM and urged settlement").
242. 155 Cong. Rec. 3457 (2009) (statement of Rep. Lamar Smith) ("Patent litigation is too expensive, too time-consuming, and too unpredictable.").
243. See, e.g., Aro Corp v. Allied Witan Co., 531 F.2d 1368, 1372 (6th Cir. 1976) ("Settlement is of particular value in patent litigation, the nature of which is often inordinately complex and time consuming.").
244. See FED. R. EVID. 706 (a) ("The court may appoint any expert that the parties agree on and any of its own choosing.");
245. Marilyn L. Huff, Developments in the Jurisprudence on the Use of Experts, 7 WASH. J. L. TECH. & ARTS 325, 328-29 (2012) ("The technical complexity of many patent claims may lead trial judges to seek the assistance of court-appointed experts, special masters, or technical advisors for assistance in the case.");
246. see also JAY P. KESAN & GWENDOLYN G. BALL, FED. JUDICIAL CTR., A STUDY OF THE ROLE AND IMPACT OF SPECIAL MASTERS IN PATENT CASES (2009), available at http://perma.cc/KAC7-JFXE (discussing the appointment and role of special masters in patent litigation and noting their use "in areas where their technical skills and training will allow them to evaluate evidence, to determine how it should be collected, or to determine how patent claims should be construed").
247. Kelly Casey Mullally, Legal (Uncertainty, Legal Process, and Patent Law, 43 LOY. L. A. L. REV. 1109, 1128-29 (2010).
248. See, e.g., Edwards Lifesciences AG v. Corevalve, Inc., 699 F.3d 1305, 1317 (Fed. Cir. 2012) ("Some complain of areas of patent law in which our guidance is mixed or muddled.").
249. See generally Mark A. Lemley, Where to File Your Patent Case, 38 AIPLA Q. J. 401 (2010) (analyzing factors that attribute to a judicial district's popularity as a forum for patent litigation).
250. See, e.g., Xuan-Thao Nguyen, Dynamic Federalism and Patent Law Reform, 85 IND. L. J. 449, 476-77 (2010) (listing a number of districts that have adopted a form of local patent rules). The Central District of California, however, has not adopted local patent rules, even though it is the largest judicial district in the country with a very busy patent docket.
251. See Craig Anderson, Central District Struggles in Its Role as Top Patent Venue, SUPPLEMENT TO L. A. & S. F. DAILY J. (Apr. 7, 2010), available at http://perma.cc/EF4N-LGJY (discussing how the Central District of California's refusal to adopt local patent rules both increases its load of patent litigation and creates uncertainty).
252. Arthur Gollwitzer III, Local Patent Rules-Certainty and Efficiency or a Crazy Quilt of Substantive Law?, 13 ENGAGE: J. FEDERALIST SOC'Y PRAC. GROUPS 94, 94 (2012).
253. District courts promulgate these local rules pursuant to FED. R. CIV. P. 83, yet some have questioned whether these local rules conform with either Rule 83 or the Rules Enabling Act.
254. See Tyco Fire Prods. LP v. Victaulic Co., 777 F. Supp. 2d 893, 904 (E. D. Pa. 2011) ("Using local patent rules to alter a defendant's pleading obligations⋯ offends the trans-substantive character of federal procedure."); Gollwitzer, supra, at 265 (discussing how local patent rules may give rise to substantive differences in case outcomes across districts).
255. E.g., D. NEV. CIV. PRAC. R. 16.1-1;
256. W. D. TENN, PATENT R. 1.1.
257. Peter S. Menell et al., Patent Claim Construction: A Modern Synthesis and Structured Framework, 25 BERKELEY TECH. L. J. 711, 788-90 (2010).
258. *1 (E. D. Tex. May 20, 2011) (noting that, in some situations, patent rules' "quick discovery deadlines" enable abuse of the judicial system);
259. McKesson Info. Solutions LLC v. Epic Sys. Corp., 495 F. Supp. 2d 1329, 1332 (N. D. Ga. 2007) ("The Local Patent Rules have been characterized as an exercise in forced door closing, in the sense that they force the parties to take infringement and invalidity positions early in the litigation and stick to them." (internal quotations omitted)).
260. Randall R. Rader, Chief Judge, U. S. Ct. App. Fed. Cir., Circuit Judges Panel of the PriceWaterhouseCoopers Leadership Conference (Feb. 18, 2006) (stating preference for claim construction to occur as late in the proceeding as possible).
261. *1 (discussing how bringing questionable patent claims may motivate settlements).
262. Parallel Networks LLC v. AEO, Inc., No. 6:10-cv-00111-LED, at 6-7 (E. D. Tex. Mar. 15, 2011) (internal quotations omitted) (order denying motion to bifurcate).
263. *5 (E. D. Tex. 2009) (order denying motion for sanctions).
264. *1.
265. See, e.g., Raylon, No. 147 6:09-cv-00355-LED, at 5 (order denying motion for sanctions);
266. Adjustacam LLC v. Amazon.com, Inc., No. 426 6:10-cv-00329-LED (E. D. Tex. Oct. 14, 2010) (order denying motion to stay and to sever claims, and granting parties' request for leave to file an early summary judgment motion regarding damages).
267. Congress, on the other hand, was somewhat concerned with this problem and enacted stricter joinder requirements for patent cases as part of the America Invents Act. 35 U. S. C. § 299 (2012).
268. Under prior joinder rules, patent owners could sue multiple unrelated defendants in the same action as long as they were alleged to have infringed on the same patent. See David O. Taylor, Patent Misjoinder, 88 N. Y. U. L. REV. 652, 671 (2013).
269. See, e.g., 02 Micro Int'l. Ltd v. Monolithic Power Sys., Inc., 467 F.3d 1355, 1366 (Fed. Cir. 2006) (holding that district court did not abuse its discretion in strictly enforcing local patent rules);
270. Genentech, Inc v. Amgen, Inc., 289 F.3d 761, 774 (Fed. Cir. 2001) (stating that it "defers to the district court when interpreting and enforcing local rules so as not to frustrate local attempts to manage patent cases according to prescribed guidelines").
271. See W. West Allen, Nevada Federal Court: The Next Best Place for Patent Litigation?, NEV. LAW., Nov. 2001, at 9-10 (explaining that the District of Nevada requires three mandatory settlement conferences held at strategic stages of the litigation: pre-claim construction, post-claim construction, and pretrial);
272. Douglas C. Muth et al., The Local Patent Rules Bandwagon, 21 INTELL. PROP. & TECH. L. J. 19, 21 (2009) (describing the Southern District of California's requirement for an early settlement conference).
273. W. D. TENN. PATENT R. 4.5 (C).
274. David E. Sosnowski, Resolving Patent Disputes Via Mediation: The Federal Circuit and the ITC Find Success, MD. B. J., Mar. 2012, at 26.
275. U. S. COURT OF APP. FED. CIRCUIT, APPELLATE MEDIATION PROGRAM GUIDELINES (2008), available at http://www.cafc.uscourts.gov/mediation/guidelines.html;
276. Wendy Levenson Dean, Let's Make a Deal: Negotiating Resolution of Intellectual Property Disputes Through Mandatory Mediation at the Federal Circuit, 6 J. MARSHALL REV. INTELL. PROP. L. 365, 366 (2007).
277. U. S. COURT OF APP. FED. CIRCUIT, CIRCUIT MEDIATION OFFICE STATISTICS (2007), available at http://perma.cc/4VAV-Y4YV;
278. U. S. COURT OF APP. FED. CIRCUIT, CIRCUIT MEDIATION OFFICE STATISTICS (2008), available at http://perma.cc/Z896-342Q;
279. U. S. COURT OF APP. FED. CIRCUIT, CIRCUIT MEDIATION OFFICE STATISTICS (2009), available at http://perma.cc/W6NL-3QNU;
280. U. S. COURT OF APP. FED. CIRCUIT, CIRCUIT MEDIATION OFFICE STATISTICS (2010), available at http://perma.cc/3WL2-Y3BH;
281. U. S. COURT OF APP. FED. CIRCUIT, CIRCUIT MEDIATION OFFICE STATISTICS (2011), available at http://perma.cc/L4ZF-PA3D;
282. U. S. COURT OF APP. FED. CIRCUIT, CIRCUIT MEDIATION OFFICE STATISTICS (2012), available at http://perma.cc/X5WE-KY48;
283. U. S. COURT OF APP. FED. CIRCUIT, CIRCUIT MEDIATION OFFICE STATISTICS (2013), available at http://perma.cc/5BLN-92EM.
284. ADAM B. JAFFE & JOSH LERNER, INNOVATION AND ITS DISCONTENTS: HOW OUR BROKEN PATENT SYSTEM IS ENDANGERING INNOVATION AND PROGRESS, AND WHAT TO DO ABOUT IT 110-26 (2004) (explaining systematic alterations in favor of patent holders, including strengthening remedies, expanding patentable topics, limiting challenges to patent validity, and increasing reliance on juries).
285. See, e.g., Michael J. Burstein, Rules for Patents, 52 WM. & MARY L. REV. 1747, 1790 (2011) ("Poor policy arising from legal formalism is especially commonplace in Federal Circuit patent cases.");
286. John F. Duffy, Rules and Standards on the Forefront of Patentability, 51 WM. & MARY L. REV. 609, 611-12 (2009) (describing how Federal Circuit overruled a prior doctrinal test and adopted the "machine-or- transformation" rule instead of a more flexible standard);
287. John R. Thomas, Formalism at the Federal Circuit, 52 AM. U. L. REV. 771, 776 (2003) (explaining "adjudicative rule formalism", according to which lawmakers are encouraged to make bright-line rules instead of vague standards).
288. See, e.g., Rochelle Cooper Dreyfuss, In Search of Institutional Identity: The Federal Circuit Comes of Age, 23 BERKELEY TECH. L. J. 766, 781 (2008) (reasoning that the Federal Circuit's tendency to change questions of fact into questions of law leads to quality and accuracy issues);
289. Paul R. Gugliuzza, The Federal Circuit as a Federal Court, 54 WM. & MARY L. REV. 1791, 1832 (2013) (arguing that, although evaluating extrinsic claim construction evidence seems to be a fact-finding task, the Federal Circuit treats it as a question of law);
290. Arti K. Rai, Specialized Trial Courts: Concentrating Expertise on Fact, 17 BERKELEY TECH. L. J. 887, 894 (2002) (noting how the Federal Circuit has declared claim construction to be a pure question of law and thus subject to de novo review).
291. Farell & Merges, supra note 168, at 958. Pursuant to the AIA, Congress has created additional administrative procedures for challenging patent validity. See Leahy-Smith America Invents Act, Pub. L. No. 112-29, 125 Stat. 284-341 (2011)
292. (codified as amended in scattered parts of 35 U. S. C.).
293. See FTC v. Activis, Inc., 133 S. Ct. 2223, 2233 (2013) (recognizing the "patent-related policy of eliminating unwarranted patent grants so the public will not continually be required to pay tribute to would-be monopolists without need or justification" (internal quotations omitted));
294. Blonder-Tongue Labs., Inc v. Univ. of Ill. Found., 402 U. S. 313, 345-46 (1971) (discussing line of Supreme Court cases that "eliminat[ed] obstacles to suit by those disposed to challenge the validity of a patent");
295. 395 U. S. 653, 671 (1969).
296. See Massillon-Cleveland-Akron Sign Co v. Golden State Adver. Co., 444 F.2d 425, 425-26 (9th Cir. 1971) (describing how the district court struggled with defining a breach of the settlement agreement as a breach-of-contract or a patent-infringement claim).
297. See, e.g., Foster v. Hallco Mfg. Co., 947 F.2d 469, 476 (Fed. Cir. 1991) ("[A] consent judgment, unlike an imposed judgment, runs afoul of Lear even with respect to the same cause of action⋯ on the theory that Lear precludes parties from removing possible challenges to validity merely by their agreement.");
298. Am. Equip. Corp v. Wikomi Mfg. Co., 630 F.2d 544, 547-48 (7th Cir. 1980) (noting that the impact of Lear on "whether consent judgment adjudicating infringement as well as validity of the patent has not yet been decided by this court" (internal quotations omitted));
299. Wallace Clark & Co v. Acheson Indus., Inc., 532 F.2d 846, 849 (2d Cir. 1976) (concluding that consent decrees were subject to court scrutiny unlike pre-Lear estoppel claims based on purely private license agreements);
300. Schlegel Mfg. Co v. USM Corp., 525 F.2d 775, 780-81 (6th Cir. 1975) (describing a circuit split regarding how to treat Lear with respect to consent decrees).
301. Wallace Clark, 532 F.2d at 849.
302. Foster, 947 F.2d at 481.
303. 238 F.3d 1362, 1368-70 (Fed. Cir. 2001);
304. see also Hemstreet v. Spiegel, Inc., 851 F.2d 348, 350-51 (Fed. Cir. 1988) (upholding the district court's settlement order dismissing litigation and stating that validity issues were finally resolved and bar a later challenge to validity under estoppel principles).
305. Flex-Foot, 238 F.3d at 1370 (emphasis added).
306. See, e.g., Maureen A. O'Rourke & Joseph F. Brodley, An Incentives Approach to Patent Settlements: A Commentary on Hovenkamp, Janis and Lemley, 87 MINN. L. REV. 1767, 1780 (2003) (arguing that the Flex-Foot rule should only apply when defendant has conducted discovery because, "[p]esumably, such discovery is likely to reveal much about probable patent invalidity").
307. DONALD S. CHISUM (ETAL)., PRINCIPLES OF PATENT LAW 1142 (2d ed. 2001) ("[A] promise not to challenge the validity of a patent will be enforced if it is in a contract of a certain type, which presently includes settlement agreements.");
308. 619 F.3d 1357, 1361-64 (Fed. Cir. 2010).
309. *26 (E. D. Mich. Mar. 8, 2006) ("[T]he Federal Circuit has repeatedly stated that the policy of preserving the public domain articulated in Lear v. Adkins must yield in view of the strong federal policy of promoting the settlement of litigation. ");
310. *3 (N. D. Ill. Aug. 11, 2004) (holding that the factors set out in Flex-Foot were not intended by the Federal Circuit as a "test" for future cases, but simply as a recitation of the facts in Flex-Foot).
311. See, e.g., Petter Invs., Inc v. Hydro Eng'g, Inc., 828 F. Supp. 2d 924, 929 (W. D. Mich. 2011) (finding that, to maintain a right to contractual estoppel, Flex-Foot did not require invalidity issues to be actually litigated in the proceeding giving rise to the settlement agreement).
312. Rates Tech., Inc v. Speakeasy, Inc., 685 F.3d 163, 172 (2d Cir. 2012) ("[W]e believe that in the patent context enforcing no-challenge clauses in prelitigation settlements would too easily enable patent owners to 'muzzle[]' licensees-the 'only individuals with enough economic incentive to challenge' the patent's validity"
313. (quoting Lear v. Adkins, 395 U. S. 653, 670 (1969))).
314. See Medtronic, Inc., v. Mirowski Family Ventures, LLC, 134 S. Ct. 843, 852 (2014).
315. See, e.g., Jennifer L. Collins & Michael A. Cicero, The Impact of MedImmune Upon Both Licensing and Litigation, 89 J. PAT. & TRADEMARK OFF. SOC'Y 748, 748 (2007) ("For patent holders⋯ looking to negotiate new license agreements, the fact that license agreements prepared and executed in the context of settlement agreements are stronger⋯ may weigh in favor of an approach of suing the potential licensee for infringement prior to negotiating the license agreement").
316. Rates Tech., 685 F.3d at 173.
317. See, e.g., Dow Jones & Co., Inc v. Ablaise Ltd., 606 F.3d 1338, 1345-49 (Fed. Cir. 2010);
318. Super Sack Mfg. Corp v. Chase Packaging Corp., 57 F.3d 1054 (Fed. Cir. 1995). This means that the validity challenge goes unresolved and the potentially invalid patent remains in force. Although the Federal Circuit has not explicitly justified this position on promotion-of-settlement grounds, it is likely that the court's prosettlement policy underlies its CNS jurisprudence, at least to some degree.
319. BLACK'S LAW DICTIONARY 1254 (abridged 7th ed. 2000) (defining vacatur as "the act of annulling or setting aside").
320. See Blonder-Tongue Labs., Inc v. Univ. of Ill. Found., 402 U. S. 313, 350 (1971) (holding that, once a patent is invalidated, nonmutual collateral estoppel prevents the patent owner from ever asserting it again).
321. See Cardinal Chem. Co v. Morton Int'l, Inc., 508 U. S. 83, 100 (1993) (noting "the importance to the public at large of resolving questions of patent validity");
322. Lear v. Adkins, 395 U. S. 653, 675 n. 19 (1969) (remarking on "the public's interest in the elimination of specious patents").
323. 513 U. S. 18 (1994).
324. See, e.g., Marseilles Hydro Power LLC v. Marseilles Land & Water Co., 481 F.3d 1002, 1003 (7th Cir. 2007) (stating that district courts are not "cabined by [Bancorp's] exceptional circumstances test");
325. Am. Games v. Trade Prods., 142 F.3d 1164, 1169 (9th Cir. 1998) (stating that district courts, in granting vacatur, are not bound by Bancorp's exceptional circumstances test).
326. Bancorp, 513 U. S. at 29.
327. See, e.g., Valero Terrestrial Corp v. Paige, 211 F.3d 112, 121 (4th Cir. 2000) (holding that Bancorp considerations are largely determinative of a district court's vacatur decision).
328. See, e.g., Marseilles, 481 F.3d at 1003 (stating that district courts are not "cabined by [Bancorp's] exceptional circumstances test");
329. Am. Games, 142 F.3d at 1169 (stating that the district court could have vacated its own judgment without using the exceptional circumstances test).
330. See GFI, Inc v. Franklin Corp., 265 F.3d 1268, 1272 (Fed. Cir. 2001). Yet the Federal Circuit has created an exception for procedural questions that are "intimately involved in the substance of enforcement of the patent right"
331. See Silent Drive, Inc v. Strong Indus., Inc., 326 F.3d 1194, 1201 (Fed. Cir. 2003). The Federal Circuit has yet to resolve the question whether vacatur is "intimately involved in the substance of enforcement of the patent right", so it is unclear whether regional circuit law or Federal Circuit law applies to vacatur motions in patent cases.
332. Dana v. E. S. Originals, Inc., 342 F.3d 1320, 1328 (Fed. Cir. 2003).
333. *1 (D. Az. May 17, 2012) (citing Judge Dyk's concurrence);
334. *1 (D. Mass. Dec. 23, 2010) (citing Judge Dyk's concurrence);
335. Trial courts granting vacatur in patent cases may also be swayed by Erickson v. Interdigital Commc'ns Corp., 418 F.3d 1217, 1224 (Fed. Cir. 2005), in which the Federal Circuit held that a district court abused its discretion by allowing a third party to intervene in a patent case in order to reinstate previously vacated rulings.
336. *1 (Fed. Cir. Aug. 24, 2010) (remanding case to allow the district court to consider granting the parties' motion for vacatur);
337. *1 (Fed. Cir. Oct. 3, 2008) ("The usual course, when the parties have settled, is to dismiss the appeal unless the parties request that the case be remanded so that the trial court can consider whether to vacate its own decision due to settlement.");
338. *1 (Fed. Cir. June 17, 2004) (remanding case to allow the district court to consider the parties' motion to vacate).
339. 629 F.3d 1374, 1375 (Fed. Cir. 2011).
340. 769 F. Supp. 2d 1065, 1071 (E. D. Tex. 2011).
341. *1 (Fed. Cir. Sept. 20, 2012);
342. *1 (Fed. Cir. July 16, 2012);
343. *1 (Fed. Cir. Sept. 6, 2011);
344. *1 (Fed. Cir. Sept. 6, 2011);
345. *1 (Fed. Cir. Apr. 4, 2011).
346. See Response in Opposition Regarding Motion for Leave to File Amicus Curiae Brief at 10-11, Ameranth, Inc v. Menusoft Sys. Corp., No. 2:07-CV-271 (E. D. Tex. Nov. 15, 2011) (No. 336) ("[T]he settlement would not have been reached without the efforts of the Chief Federal Circuit Mediator and his suggestion of the motion for vacatur to facilitate the settlement.");
347. Compare U. S. COURT OF APPEALS FED. CIRCUIT, APPELLATE MEDIATION PROGRAM GUIDELINES (effective May 1, 2008), available at http://perma.cc/QQJ3-AEAZ (omitting any discussion of vacatur as a term of settlement)
348. with U. S. COURT OF APPEALS FED. CIRCUIT, APPELLATE MEDIATION PROGRAM GUIDELINES (amended Sept. 4, 2012), available at http://www.cafc.uscourts.gov/ mediation/guidelines.html (contemplating vacatur as a term of settlement).
349. See U. S. COURT OF APPEALS FED. CIRCUIT, AMENDMENTS TO U. S. COURT OF APPEALS FOR THE FEDERAL CIRCUIT'S APPELLATE MEDIATION PROGRAM GUIDELINES (Dec. 6, 2013), available at http://perma.cc/D6BN-JSWG (stating that the "Federal Circuit takes no position as to whether the District Court should grant the motion for vacatur").
350. See Silent Drive, Inc., v. Strong Indus., Inc., 326 F.3d 1194, 1201 (Fed Cir. 2003);
351. See Campbell Pet Co v. Miale, 542 F.3d 879, 885 (Fed. Cir. 2008) (stating that "a patentee's act of sending letters to another state claiming infringement⋯ is not sufficient to confer personal jurisdiction in that state.");
352. Silent Drive, 326 F.3d at 1202 (stating that "the sending of letters threatening infringement litigation is not sufficient to confer personal jurisdiction. ");
353. Red Wing Shoe Co v. Hockerson-Halberstadt, Inc., 148 F.3d 1355, 1360-61 (Fed. Cir. 1998) (stating that the sending of cease-and-desist letters is not sufficient to establish personal jurisdiction).
354. See Avocent Huntsville Corp v. Aten Int'l Co., 552 F.3d 1324, 1333 (Fed. Cir. 2008) (conceding that one would expect the letters to support an assertion of personal jurisdiction);
355. Silent Drive, 326 F.3d at 1202 (conceding that cease-and-desist letters are purposefully directed at the forum state);
356. see also Megan M. La Belle, Patent Litigation, Personal Jurisdiction, and the Public Good, 18 GEO. MASON L. REV. 43, 82-95 (2010) (arguing that the Federal Circuit's jurisdictional analysis contradicts Supreme Court precedent).
357. Red Wing Shoe, 148 F.3d at 1361.
358. Innovation Act, H. R. 3309, 113th Cong. § 299A (e) (2013).
359. Patent Transparency and Improvements Act, S. 1720, 113th Cong. § 299B (b) (2013).
360. See Tony Dutra, NY Agrees to Terms with Patent Troll MPHJ, Firm Fights Back with Lawsuit Against FTC, http://perma.cc/YDX9-DQAU (bna.com, archived Feb. 2, 2014);
361. Ashby Jones, New York State Cracks Down on Patent Trolls, http://perma.cc/C94D-SBYR (wsj.com, archived Feb. 2, 2014);
362. Timothy B. Lee, How Vermont Could Save the Nation from Patent Trolls, http://perma.cc/7JCH-Z7C7 (washingtonpost.com, archived Feb. 2, 2014).
363. As with personal jurisdiction, the Federal Circuit has held that its law governs discovery matters in patent cases if the materials subject to discovery relate to an issue of substantive patent law. In re Spalding Sports Worldwide, Inc., 203 F.3d 800, 803 (Fed. Cir. 2000).
364. See, e.g., ResQNet.com, Inc v. Lansa, Inc., 594 F.3d 860, 869-72 (Fed. Cir. 2010) (showing that, in litigation, an accused infringer sought discovery of a patent owner's settlement of prior infringement lawsuits).
365. See, e.g., Rothman v. Target Corp., 556 F.3d 1310, 1321 (Fed. Cir. 2009) (stating that willingness to license patented invention is objective evidence related to obviousness analysis).
366. *2-4 (N. D. Cal. 2012) (order granting motion to compel depositions and settlement agreement), available at http://perma.cc/MVP2-B8U4 (finding Apple's settlement with HTC relevant to request for permanent injunctive relief against Samsung).
367. In re MSTG, Inc., 675 F.3d 1337, 1339, 1346 (Fed. Cir. 2012);
368. Wayne D. Brazil, Protecting the Confidentiality of Settlement Negotiations, 39 HASTINGS L. J. 955, 985 (1988) ("[C]ourts that admit evidence from settlement negotiations discourage communication about settlement and impair the rationality of settlement discussions, and thus help to defeat the policy of encouraging consensual resolution of disputes.").
369. MSTG, 675 F.3d at 1346.
370. see also Advanced Cardiovascular Sys., Inc v. Medtronic, Inc. 265 F.3d 1294, 1307-08 (Fed. Cir. 2001) ("[W]e are mindful⋯ of the policy in favor of protecting settlement negotiations from being admitted as evidence, thus serving to encourage settlements.").
371. FTC v. Actavis, Inc., 133 S. Ct. 2223, 2239 (2013) (Roberts, J., dissenting) (noting that settlement is ordinarily thought of as "a good thing");
372. 133 S. Ct. at 2233.
373. See, e.g., Robert J. Hoerner, Antitrust Pitfalls in Patent Litigation Settlement Agreements, 8 FED. CIR. B. J. 113, 114 (1998) ("When an alleged infringer decides that it is in his interest to settle a patent infringement litigation against him, his entire business outlook changes. Where before he wanted the patent held invalid, he now may want the patent held valid so that the patent owner can assert it against his competitors.").
374. The Public Patent Foundation is a nonprofit "legal services organization whose mission is to protect freedom in the patent system." About PubPat, http://perma.cc/K4TE-5ENP (pubpat.org, archived Feb. 2, 2014).
375. Public Knowledge is a public interest organization whose mission includes "upholding] and protecting] the rights of consumers to use innovative technology lawfully." Mission Statement, http://perma.cc/F7E-6F48 (publicknowledge.org, archived Feb. 2, 2014).
376. See 35 U. S. C. §§ 319, 329 (2011). In a recent case, however, the Federal Circuit raised the question whether the appellant-a public interest organization-has Article III standing to appeal the PTO's adverse validity decision.
377. See Consumer Watchdog v. Wis. Alumni Research Found., No. 2013-1377 (Fed. Cir. 2013). Oral argument in the case was held late last year, after which the Federal Circuit invited the PTO and the United States to weigh in on the standing question. On January 17, 2014, the government filed its brief in which it takes the position that appellant Consumer Watchdog lacks Article III standing to appeal the PTO's decision.
378. See Brief for the United States as Amicus Curiae, No. 2013-1377 (Fed. Cir. Jan. 17, 2014). If the Federal Circuit agrees with the government, public interest organizations and the consumers they represent will be further disenfranchised by these restraints on their ability to participate in the patent system.
379. See e.g., Josh Hartman & Rachel Krevans, Counsel Courts Keep: Judicial Reliance on Special Masters, Court-Appointed Experts, and Technical Advisors in Patent Cases, 14 SEDONA CONF. J. 61 (2013).
380. See, e.g., eBay, Inc v. MercExchange, LLC, 547 U. S. 388, 391 (2006) (listing public interest as one of the factors in deciding whether to grant permanent injunctive relief);
381. A. C. Auckerman Co v. R. L. Chaides Constr. Co., 960 F.2d 1020, 1046-47 (Fed. Cir. 1992) (noting public policy concerns in a laches analysis);
382. In re Recombinant DNA Tech. Patent & Contract Litig., 850 F. Supp. 769, 772 (S. D. Ind. 1994) (explaining that patent misuse considers the "public's interest in assuring that a patentee does not extend his patent beyond the statutory monopoly he has been granted").
383. See FED. R. CIV. P. 23 (e) (providing that class action settlements are subject to the trial court's approval).
384. See, e.g., Ohio Willow Wood Co v. Thermo-Ply, Inc., 629 F.3d 1374, 1376 (Fed. Cir. 2011) (Moore, J., concurring) (explaining that invalidation will collaterally estop the patentee from asserting the patent in this and other suits);
385. Ohio Willow Wood Co., 629 F.3d at 1376.
386. See Jorge L. Contreras, Fixing FRAND: A Pseudo-Pool Approach to Standards-Based Patent Licensing, 79 ANTITRUST L. J. 47, 50-52 (2013);
387. Joseph Scott Miller, Standard Setting, Patents, and Access Lock-In: RAND Licensing and the Theory of the Firm, 40 IND. L. REV. 351, 371 (2007).
388. *1 (W. D. Wash. Apr. 25, 2013) (first U. S. court to determine RAND terms for a standards-essential patent);
389. Doug Lichtman, Understanding the RAND Commitment, 47 HOUS. L. REV. 1023, 1031 (2010) (describing the lack of guidance offered by the language of the RAND commitment as "something of an outrage").
390. 133 S. Ct. 2107 (2013). In Myriad, the Supreme Court unanimously held that isolated human genes are not patentable subject matter under § 101.
391. See, e.g., Apple, Inc v. Samsung Elecs. Co., 695 F.3d 1370 (Fed. Cir. 2012) (accusing the popular Android smartphone of infringement);
392. NTP, Inc v. Research in Motion, Ltd., 418 F.3d 1282 (Fed. Cir. 2005) (accusing the popular BlackBerry device of infringement). Of course, there is a potential downside to adjudicating these cases if the patent owner prevails and secures an injunction that could directly affect a large number of consumers. While a real risk, I believe it's one worth taking in many cases, especially seeing how district courts post-eBay consider the public's interest in deciding whether to grant and how to fashion permanent injunctive relief.
393. See, e.g., i4i Ltd. Pship v. Microsoft Corp., 589 F.3d 1246, 1277 (Fed. Cir. 2009)
394. (holding that injunction was narrowly tailored to minimize harm to public), rev'd on other grounds, 598 F.3d 831 (2010).
395. See Ass'n for Molecular Pathology v. Myriad Genetics, Inc., 702 F. Supp. 2d 181, 190-92 (S. D. N. Y. 2010) (noting the various amici in the case).
396. James Ware & Brian Davy, The History, Content, Application and Influence of the Northern District of California's Patent Local Rules, 25 SANTA CLARA COMPUTER & HIGH TECH. L. J. 965, 1005 (2009).
397. See, e.g., Connell v. Sears, Roebuck & Co., 722 F.2d 1542, 1549 (Fed. Cir. 1983) ("[T]here is virtually always 'pertinent' and 'relevant' art apparently unconsidered in the PTO and available to a patent challenger.").
398. See Susan Freiwald, Cell Phone Location Data and the Fourth Amendment: A Question of Law, Not Fact, 70 MD. L. REV. 681, 692-93 (2011) (explaining that district court invited amicus briefs from public interest organizations, academics, and public defenders).
399. Michele Estrin Gilman, Litigating Presidential Signing Statements, 16 WM. & MARY BILL RTS. J. 131, 151 (2007).
400. 35 U. S. C. § 285 (2012).
401. 726 F.3d 1359, 1361 (Fed. Cir. 2013).
402. Randall R. Rader et al., Making Patent Trolls Pay in Court, http://perma.cc/5R8K-F6G6 (nytimes.com, archived Feb. 2, 2014).
403. See Octane Fitness, LLC v. ICON Health & Fitness, Inc., 496 F. App'x 57 (Fed. Cir. 2012)
404. *1 (U. S. Oct. 1, 2013);
405. Highmark, Inc v. Allcare Health Mgmt. Sys., Inc., 687 F.3d 1300 (Fed. Cir. 2012)
406. *1 (U. S. Oct. 1, 2013).
407. See, e.g., Charles Silver & Geoffrey P. Miller, The Quasi-Class Action Method of Managing Multi-District Litigations: Problems and a Proposal, 63 VAND. L. REV. 107, 114 (2010) (discussing the judicial powers associated with class actions).
408. See, e.g., In re Vioxx Prods. Liab. Litig., 650 F. Supp. 2d 549, 554 (E. D. La. 2009) (noting that an MDL is distinct from a class action but similar enough to warrant treatment as a quasi-class action);
409. In re Zyprexa Prods. Liab. Litig., 489 F. Supp. 2d 230, 1 (E. D. N. Y. 2008) (noting that the 30, 000 cases brought against Eli Lilly & Company had been administered as a quasi-class action).
410. Linda Mullenix, Dubious Doctrines: The Quasi-Class Action, 80 U. Cin. L. REV. 389, 389 (2012) (arguing that "there is no such thing as a quasi-class actions").
411. *2 (2013) (explaining the new joinder provisions in the AIA);
412. FED. R. CIV. P. 1;
413. see also Suzette M. Malveaux, Front Loading and Heavy Lifting: How Pre-Dismissal Discovery Can Address the Detrimental Effect of Iqbal on Civil Rights Cases, 14 LEWIS & CLARK L. REV. 65, 107 (2010) (explaining that "courts may exercise their broad discretion to grant discovery and manage their cases in such a way as to serve the goals of justice and efficiency").
414. See, e.g., 155 Cong. Rec. H3457 (Mar. 11, 2009) (statement of Rep. Lamar Smith) (arguing the negative attributes of patent litigation).
415. See Blonder-Tongue Labs., Inc v. Univ. of Ill. Found., 402 U. S. 313, 350 (1971) (allowing petitioner to amend pleading to assert a plea of estoppel).
416. See, e.g., Josh Lerner, The Litigation of Financial Innovations, 53 J. L. & ECON. 807, 816 (2010) (explaining that patentee was able to license its patent to Bank of America, CapitalOne, and other major credit card providers after the patent withstood a validity challenge);
417. Lee Petherbridge, Positive Examination, 46 IDEA 173, 176 (2006) (" [I]f competitors believe that a patent is likely not valid, they are less likely to take a license to that patent.").
418. see also FTC v. Actavis, 133 S. Ct. 2223, 2247 (2013) (Roberts, J., dissenting) (arguing that the majority's decision to reject certain reverse payment settlements "may very well discourage" litigation in the first place).
419. See, e.g., James Farrand et al., "Reform" Arrives in Patent Enforcement: The Big Picture, 51 IDEA 357, 440 (2011) ("[T]he increased risk of invalidation influences bargaining power, licensing negotiations, litigation decisions, and settlement proposals.").