Tuesday, April 11, 2006

RTTNews on eBay v. MercExchange

from tradingmarkets:

The law unambiguously grants patent holders the exclusive right to their inventions. But those sympathetic to the high-tech industry argue that tech companies are churning out such complex products that they may not even know when they are infringing. [IPBiz note: the issue of a permanent injunction comes up ONLY AFTER validity and infringement are established; thus, a comment about "not knowing" whether a person is infringing is irrelevant to the issue in eBay v. MercExchange.]

The tech industry also points out that, in the case of a company like MercExchange, which is not even using its patents, monetary damages should be sufficient recompense for infringement. "If there's a company that is licensing for a living and, therefore, money will make them whole, the court should be willing to consider that," says Steven Bauer, a patent attorney in Boston. [IPBiz note: should the manner in which a company has exercised its property right serve as a limitation to how it might choose to exercise in the future?]

San Jose, California-based eBay has argued that federal judges should have more discretion to deny an injunction and instead issue a monetary award to the patent holder.

But drug makers and the biotech industry, which both sink billions into research for patented medicines and technologies, oppose watering down the rights of patent holders. They say the right to an injunction is at the core of the U.S. intellectual property system, much like a landowner's right to evict trespassers.

With so much at stake, they will be biting their nails until the court hands down its ruling sometime in June or July.

"Limiting the availability of an injunction after a judge or jury have found a patent to be valid and infringed would severely undermine the patent system and drive up the cost of innovation," the industry trade group Pharmaceutical Research and Manufacturers of America said in a brief filed with the Supreme Court.

Separately from the Supreme Court case, the software industry has pressed a campaign on Capitol Hill to weed out illegitimate patents and rein in the power of patent holders. Lobbying efforts center on legislation being drafted by Rep. Lamar Smith, a Republican from Texas who chairs a key House subcommittee. Smith introduced a patent reform bill last year to modernize and overhaul patent laws and help the Patent and Trademark Office do better job vetting new patents.

Smith's bill originally included a provision making it more difficult to get an injunction, but it was removed from the bill after running into opposition from drugmakers and others.


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