AME 40590: April 29,2011 HW Assignment: Quanta Brief Summary

Brief Amicus Curiae of Computer & Communications Industry Association In Support of Petitioners Summary:

- The members of CCIA (Computer and Communications Industry Association) are part of various sectors in industry who depend upon the patent system to promote innovation. The decision in this court case, would affect the “future economic prospects of CCIA’s industry sector.

- CCIA is arguing that making the sale of a patent to have “conditional” requirements, circumvents the patent owner from “exhausting” the patent. CCIA cites the case Mallinckrodt v Medipart.

- If this requirement stands, then it offers patantees the ability to extend beyond the “single use” restriction and allow them to issue license fees all the way down the distribution chain.

- This will lead to people who will take advantage of the system to create monopolies over certain markets, which would ruin the competitive market system that the patent system was intended to be

- Having a “conditional” requirement would affect the informations and communications technology sector tremendously because the sector is complex and interconnected, which would make it easier for an “opportunist” to take advantage of this situation to create a monopoly over this sector.

- The “conditional” requirement is very broad allowing an infinite number of ways to satisfy various purposes.

- The IT market should be kept transparent, and by initiating this “conditional” requirement, this transparency in the market will disappear. Transparency creates a market that is more “robust” and “vigorous.” This type of market would disappear and instead be replaced by a “lawyers' playground - a top-down shadow economy of permissions that contributes no technology or economic value but is able to exploit whatever dependencies, lock-in, and inertia exists in the present distribution chain.” This will undermine innovation

- Search costs will increase to insure that inventors are not infringing on patents. Will have to look upstream on the distribution chain as well to determine whether one is infringing on a patent. Therefore, the search becomes harder in determining whether one is infringing. Research is a responsibility of the public before filing the patent.

- A recent court ruling, decided that this search was impossible

- Quote to represent the problem with the “conditional” rule: “By making patents plentiful, powerful, and easy to assert, the Federal Circuit has abetted portfolio racing and helped bring about the patent thickets that shroud the patent landscape, undermine the public disclosure principle, and frustrate the notice function. The notice function in particular has been limited by the Federal Circuit's de novo review of claims interpretation.”

- CCIA asks for the federal circuit court of appeals to reverse their decision that the “exhaustion” rule is not in place over methods.